The US electric car pioneer Tesla According to information from an insider, is planning to produce a new entry-level model for its German factory. The car should cost 25,000 euros, a person familiar with the matter told the Reuters news agency on Monday. Tesla boss Elon Musk (52) visited the factory last Friday and used this opportunity to inform about the plans. Tesla’s best-selling Model Y has been rolling off the production line there. An application has already been made to double the capacity to one million cars per year. Tesla did not want to comment on this; the shares rose around 2.5 percent at the start of trading on Monday.
The electric car manufacturer has long been aiming for a low-cost model, but put the plans on hold last year due to unsolvable technical issues. In September, Reuters learned that Tesla was close to molding the vehicle’s entire underbody in one piece, a breakthrough that could cut costs and speed production. However, it is still unclear when production of the entry-level model will start.
A model suitable for mass production would be an important step for the car manufacturer, which would replace the traditional volume manufacturers Volkswagen, Toyota and General Motors by 2030 with annual sales of 20 million cars. It is still unclear who will win the race for the first low-budget electric car. Volkswagen plans to bring its ID.2 onto the market in 2026 for around 25,000 euros.
Salaries in Grünheide will be increased
Musk also used his visit to thank the employees for their commitment. You should get 4 percent more pay from November, as Tesla announced on Friday. In December, an inflation compensation of 1,500 euros will be added, and from February the annual wages of around 11,000 employees will be increased by an additional 2,500 euros. The Union IG Metall had complained in the past that wages at the US electric car manufacturer were around 20 percent below the industry collective agreement and last month canvassed for members in front of the factory gate.
“Claims that there is a connection between Tesla’s salary adjustments and union activity are without any truth,” Tesla said. The wage increases are the result of an internal standard process. The management negotiated with the works council of the Gigafactory in Grünheide.
Although the union welcomed the wage increases, it also made further demands. The steps announced last week were “absolutely justified and necessary,” said IG Metall Berlin-Brandenburg-Saxony district manager Dirk Schulze on Monday. “However, even after this wage increase, pay at Tesla remains well below the usual level in the auto industry in Germany.”