Tesla goes through some major changes, and now we all know why: the corporate says it’s changing its product roadmap because of “pressure” on electric vehicle sales.

The new accelerated plan now includes “lower-cost models” that the corporate says will probably be launched next 12 months. Or if Tesla CEO Elon Musk is to be believed – and that is a protracted bet given his track record on the schedule – possibly as early as late 2024.

The shocking announcement sent the corporate’s shares soaring greater than 11% in after-hours trading on Tuesday. The price didn’t drop whilst Musk and other Tesla executives declined to share further details on a call with investors.

All this comes after a bomb report in early April, Reuters claimed that Tesla had abandoned work on a next-generation low-cost automotive. This next-generation automotive was expected to be built on the identical EV platform that Tesla is developing for its rumored robotaxi vehicle. Tesla said this next-generation automotive could arrive as early as late 2025.

While Musk recklessly claimed that Reuters was “lying,” they each Electric AND Bloomberg News have since reported that the development of this particular electric vehicle has been delayed or the corporate has missed the push. Musk has since posted on the social media site X that Tesla will unveil the robotaxi on August 8.

Tesla provided this update in its unimpressive first quarter earnings report, which showed a 55% year-over-year decline in profits. The company said in a report that it has “updated (its) future vehicle lineup to accelerate the launch of new models ahead of the previously announced production start in the second half of 2025.” The new vehicle lineup includes “more affordable models,” the corporate said.

These new offerings, nevertheless, are usually not woven together. Tesla says it’ll construct these vehicles on existing production lines and that they’ll “leverage aspects” of the next-generation platform it’s developing, “as well as aspects of our current platforms.”

Bloomberg News reported earlier this week what Tesla was working on new versions of Model Y and Model 3 which borrowed technology and processes from the next-generation electric vehicle, with a specific deal with the Model Y.

Tesla investors may have to attend to learn more.

During the conversation with investors, Musk addressed the query of what the motion plan for Tesla’s new product actually is. “We’ll talk about it on August 8,” he said, referring to the event Tesla has planned to showcase its robotaxi, which it calls the “Cybercab.”

Asked about an analogous query later within the conversation, Musk said: “I think we’ve said everything we wanted to on this matter.”

Tesla Vice President Lars Moravy said the new platform carries “some risk” and that Tesla could leverage “all of the subsystems” which are being developed for it, reminiscent of powertrains, drive units, in addition to improvements in manufacturing and automation, thermal systems, seats” and more. “All of this is transferable, and that’s what we’re doing — we’re trying to incorporate it into new products as quickly as possible,” he said. “This engineering work – we’re not trying to just throw it away and put it in a coffin.”

Cost versus growth

Tesla has worked to cut back the associated fee of manufacturing its next-generation electric vehicle by 50% in comparison with the platform that underpins the Model 3 and Model Y.

The company admitted Tuesday that it’ll lose some savings by switching to a technique of mixing next-generation technologies and processes with existing platforms and production lines.

According to Tesla, the advantage is height. The company says it might probably double its 2023 production (which was about 1.8 million vehicles) by 2025. And while it won’t save that much on automotive costs, it won’t must construct new production lines to provide these mysterious new vehicles either. The company has already slowed work on a new factory in Mexico, where it originally planned to begin producing next-generation electric vehicles and robotxi.

Of course, Tesla has said for years that it expected to attain 50% annual growth, on average, over several years, and has consistently failed to fulfill that goal. As the corporate warns, this 12 months it’ll grow at a “significantly lower” rate.

There are other challenges as well. Tesla says it might probably launch a new product line after shedding an enormous variety of employees from its global workforce – although Musk said on Tuesday that the corporate is “not cutting out anything significant that I’m aware of.”

“We have just had a long period of prosperity from 2019 to now,” Musk said on the decision. “We have made some adjustments along the way, but it is time to reorganize the company for the next phase of growth.”