Tesla’s stock took a hit this week after reports confirmed that the production launch of its affordable Model Y variant will be delayed.
The electric vehicle giant had initially promised an entry-level Model Y to boost its flagging sales numbers.
However, insiders revealed that production challenges and supply chain disruptions have postponed the project by several months.
Tesla stock news spread quickly, with shares dropping nearly 5% in after-hours trading.
The affordable Model Y, internally referred to as Project E41, was expected to start production earlier this year.
Sources indicate that U.S. manufacturing plants are still not fully equipped to handle the revised design and material needs.
CEO Elon Musk did not immediately comment on the delay, but analysts fear the company’s 2025 sales targets could be at risk.
Tesla’s competitors, including Ford and Rivian, have also announced new models targeting the lower-priced EV segment.
Investors are concerned that Tesla could lose market share if affordable alternatives flood the market.
Analysts at major investment firms have adjusted their short-term price targets for Tesla downward.
The delay in Tesla’s low-cost offering raises questions about its broader production strategy.
In recent months, Tesla has faced slowing demand in key markets like China and Europe.
Additionally, ongoing regulatory scrutiny over its Full Self-Driving features adds to the challenges.
Despite the drop, some long-term investors view the dip as a buying opportunity, betting on Tesla’s innovation.
Tesla stock news will likely remain volatile as shareholders await clearer production timelines.
Musk has hinted at a future announcement regarding next-generation manufacturing technologies.
Meanwhile, Tesla continues to expand into energy solutions and AI-driven projects.
The setback underscores how competitive and unpredictable the global EV market has become.
Tesla’s next earnings call could be crucial in rebuilding investor confidence.
For now, cautious optimism defines Tesla’s immediate outlook amid mounting pressures.