Tesla is developing a smaller, cheaper SUV, report says

Tesla is working on a new car, and it's going to be exactly what many are hoping for: a smaller, cheaper electric SUV.

This is according to Reuters, which spoke with four people familiar with the matter. According to the report, the new car will be an entirely new model, and not a variant of the Model 3 or Model Y (Tesla recently discontinued its larger sedan and SUV, the Model S and the Model X).

The new Tesla SUV would be about 14 feet long, making it considerably shorter than the Model Y, which is 15.7 feet long. It would also be "substantially" cheaper than the Model 3, which is currently the most affordable Tesla you can get, starting at $37,000 in the U.S.

The new SUV, which Tesla plans to manufacture in China, might also be offered with a smaller battery and just a single motor instead of two (both the Tesla Model 3 and Model Y can come with either with one or two motors). This would make the car lighter than other Tesla models, but the smaller battery might also mean it'll have less range than existing models.

There are no details on when Tesla plans to launch the new car, and the report says that the project is still in an "early development stage," meaning it might not happen at all.

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The fact that Tesla is working on something isn't a secret; just a few weeks ago the company CEO Elon Musk tweeted that Tesla is working on something "way cooler than a minivan."

Figuring out exactly what Tesla's exact plans are is another matter. The company is working on an autonomous vehicle called the Cybercab (or the Robovan; the name doesn't seem to be set in stone yet). And Tesla was reportedly working on a cheaper model for years before scrapping it, seemingly in favor of offering cheaper variants of existing models.

Notably, when Reuters reported on Tesla giving up on launching a cheaper model in 2024, Musk tweeted that the news agency was "lying". The fact is, the company never did launch a cheaper model; we'll see if things turn out differently this time.