Tesla's six-seat Model Y variant may not be launched in U.S.

Tesla Model Y electric vehicle (EV) in Beijing, China January 8, 2025
Reuters

Tesla (TSLA.O) chief executive Elon Musk has said the company’s new six-seat Model Y, unveiled in China this week, may never be produced in the United States, citing the rise of self-driving technology.

The Model Y L, manufactured at Tesla’s Shanghai plant, has a longer wheelbase, three rows of seats, and is priced at roughly $47,200. It went on sale in China on Tuesday, where Tesla is facing intensifying competition from domestic electric carmakers such as BYD (002594.SZ) and Xiaomi (1810.HK). Responding to a user on X, Musk wrote: “This variant of the Model Y doesn’t start production in the US until the end of next year. Might not ever, given the advent of self-driving in America.” He did not explain why autonomous driving would make a six-seater unnecessary. Tesla declined to comment.

Three-row petrol SUVs have long been popular among American families, but producing profitable electric vehicles of similar size remains a challenge for the industry. New policies introduced by the Trump administration are also expected to raise the cost of EVs, pushing manufacturers to concentrate on smaller, cheaper models. Tesla is preparing to launch a lower-cost Model Y with fewer premium features later this year, which Musk has described simply as “just a Model Y.”

In the United States, the company is increasingly shifting its focus towards robotaxi development. A limited robotaxi service was rolled out in Austin in June, with ambitions to expand to cover half of the U.S. population by year’s end. Musk has previously told investors that producing conventional cars would be “pointless” in a self-driving future.

Next year, Tesla plans to begin production of the Cybercab, a dedicated two-seat robotaxi with no steering wheel or pedals.

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