The Tesla Model 2 is a major milestone in Tesla’s vision to make electric mobility affordable for everyone. However, Evercore analysts warn of potential problems that could delay its entry into the mass market. Although production is scheduled for late 2025 at the Austin plant, development of the less expensive model will likely take longer than expected, experts say. The $20,000 price target aims to make electric technology more accessible, but Tesla may face stiff competition in this market segment. In addition, the issue of integrating a basic autonomous driving system raises questions about Tesla’s strategy to maintain its competitive advantage.

Tesla Model 2, the one to take the torch

Since entering the automotive arena, Tesla has been constantly pushing the boundaries of innovation and vision. With the Tesla Model 2 in the works, the company is entering a new era in its quest for affordable electric mobility available to all. However, according to Evercore analysts, this vision will take more time than expected. In a recent report, Evercore analysts highlighted this a less expensive model will take longer to develop. They question the feasibility of a mass launch by 2027, suggesting that production of around 500,000 units in 2026 may be a more realistic target than the optimistic consensus of over a million units. This more cautious view reflects an understanding of the complex challenges Tesla faces in realizing its vision. Elon Musk, CEO of Tesla, described the company as “between two great waves of growth”and the former is supported by the Model 3 and Model Y, and the latter is expected with the appearance of a cheaper electric car of the next generation.

See you in 2026-2027

Tesla Model 2, as it is colloquially called, is presented as a symbol of this second wave of growth. Production of this electric car, which is planned for the end of 2025 at the plant in Austin, promises to significantly reduce the financial barriers to entry into the electric car market. With a target price of $20,000, the Model 2 aims to make electric technology more accessible to a wider consumer base. She will have a lot to do, because she will not be alone in the market. Many manufacturers, such as Renault with its Twingo, are preparing more affordable electric cars to increase sales. Cost reduction won’t be the only problem for Tesla. Experts are wondering if the autonomous driving system will come standard on board this Tesla, as it represents a significant cost of around $2,000 to $3,000. However, the feature could also play a crucial role in Tesla’s strategy to maintain its leadership position in autonomous driving.

Despite these challenges, Tesla’s ambitions remain decidedly high. Evercore now predicts that Tesla will deliver about 2.7 million vehicles in 2026, though that forecast falls short of the current consensus. This downward revision reflects a more realistic view of the time frame and challenges facing the company.