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Investing.com -- Some senior Tesla Inc (NASDAQ:TSLA) executives were caught off guard last year when Elon Musk publicly denied a Reuters report claiming the company had scrapped its plan for a $25,000 electric vehicle, according to Reuters.
“Reuters is lying,” Musk posted on X shortly after the article published on April 5, 2024, halting a 6% slide in Tesla shares. The stock recovered slightly but still ended the day down 3.6%.
At the time, executives were aware that Musk had indeed canceled the project, often referred to by investors as the Model 2, and shifted the company’s focus toward autonomous robotaxis. Internal communications had informed employees weeks earlier that the project was over, Reuters reported, citing documents and three sources.
Musk’s denial was so unexpected that some senior managers asked whether he had changed course. According to people familiar with the discussions, Musk dismissed their concerns and reaffirmed that the project remained shelved.
The revelation highlights Tesla’s ongoing struggle to deliver a mass-market, low-cost EV—long seen as central to its growth strategy. While some insiders were unsettled by Musk’s public statements, others viewed them as consistent with Tesla’s flexible approach to product planning.
More than a year later, Tesla has yet to release the entry-level EV, as sales soften and its lineup ages. Musk has neither confirmed nor explicitly stated that the affordable model has been canceled, though it remains absent from Tesla’s roadmap.
On Wednesday, Musk announced he would step down from his role as special advisor to U.S. President Donald Trump to focus on his businesses, including Tesla and SpaceX.