Tesla abandoned the creation of an inexpensive electric car in favor of robotaxis

Elon Musk decided to abandon the idea of ​​​​creating a budget electric car under the Tesla brand, switching the focus to the development of autonomous robotaxis.

Musk's long-time vision has been to offer consumers an affordable electric car for $25,000. His strategy since 2006 has been to initially produce premium models and then move to budget electric vehicles.

Tesla's strategy has changed due to increased competitive pressure from Chinese manufacturers producing more affordable models. While the company was developing the Cybertruck, Chinese automaker BYD took the lead, announcing production of 3.02 million vehicles in 2023.

Tesla's new self-driving robotaxi plan poses a more complex engineering challenge and carries greater regulatory risk.

Currently, the timing of the project and Tesla's business model in this direction remain uncertain. However, Musk has already spoken out about the future of transportation, suggesting that autonomous taxis could eventually become a more popular mode of transport than low-cost electric cars.

“Tesla, the most valuable automaker in the world, would be worth virtually nothing without achieving full autonomy.”

Elon Musk

Autonomous cars today received approval from U.S. and Chinese regulators for limited experimental use on public roads. However, Tesla still faces the challenge of proving its ability to create a fully self-driving car.