Over the years, Tesla has been at the forefront of electric vehicles (EVs), with its highly technological products, good performance, and increasing presence across the world. However, one thing has been a constant criticism, and that is affordability. Although Model 3 enabled Tesla to enter a new price range, the brand’s best-selling SUV, Model Y, has not been affordable to a number of consumers.
This might soon change with the new version, known as E41, of Tesla, which can combine the famous Model Y platform with a smaller battery pack of 50 kWh, which will make the price of this vehicle start at between $33k and $35k.
Tesla Model Y has been the most popular vehicle globally, which has sold more than even the Toyota Corolla in selected markets. Its appeal to the families, commuters, and first-time EV consumers is affected by its versatility as a small SUV. The existing entry point, however, above $40k in most markets, poses a challenge to low-end consumers.
This smaller and lower-priced version will radically increase the number of people Tesla can address. With a price of $33K–35K, the Model Y E41 would directly rival gasoline-powered compact SUVs such as the Toyota RAV4, Honda CR-V, and Hyundai Tucson: these segments sell millions of units every year.
The Rumored 50 kWh Battery Pack
The new affordable Model Y is highly rumoured to have a 50kWh battery pack. Today, the variants of Model Y come with a range of 260 to 330 miles (420 -530 km) using packs with a size of 60 kWh and above.
A 50 kWh pack would help Tesla save greatly on the cost of production. This, however, also implies reduced driving range. Industry observers project that a 50 kWh Model Y would have a range of 220-250 miles (EPA-rated) – enough to drive around, though not to cover longer trips.
The given strategic tradeoff is reflective of the Tesla philosophy in general: have a variety of range choices at various price points. This is because most drivers, particularly urban and suburban commuters, do not require 300+ miles of range, and the smaller pack offers a viable trade-off.
Why $33K–$35K Matters
The only potentially important factor in EV adoption is price. Breaking the psychological divide to the low-30K range means that the Model Y is no longer the aspirational EV, but a mainstream offering.
Government incentives: Although it might not be sufficiently low in the U.S., a federal EV tax credit of up to $7,500 might prove to be effective in bringing the entry price down to less than $27,000, cheaper than even many gasoline SUVs.
Global competitiveness: In Europe and Asia, where smaller EVs are already widespread, a more affordable Model Y will enable Tesla to retain its market dominance over Chinese rivals such as BYD, which control the low-cost EV market.
Consumer access: Tesla would provide access to millions of households that could not afford a brand previously due to its high cost.
