(Reuters) – Tesla has canceled the long-promised inexpensive car that investors have been counting on to drive its growth into a mass-market automaker, according to three sources familiar with the matter and company messages seen by Reuters.
The automaker will continue developing self-driving robotaxis on the same small-vehicle platform, the sources said.
COMMENTARY:
TOM HAYES, CHAIRMAN, GREAT HILL CAPITAL
“The (News) confirms what we’ve been saying for some time, that it’s unclear whether consumers actually want EVs or Teslas. It’s a business that’s been subsidized by the government and even with the subsidies, they’re not as attractive as imagined.”
CHRIS PIERCE, RESEARCH ANALYST, NEEDHAM & CO
“It shows that they (Tesla) need to kind of go back to the drawing board and figure out kind of what their next move is going to be because they’re sitting on elevated inventories for the Model Y, which is their best-selling car.”
“I just don’t know that the full stuff driving robotaxi feature that Tesla sees is something consumers are ready for.”
DAN IVES, ANALYST, WEDBUSH SECURITIES
“This would be a dark cloud moment for Tesla. Would be a nightmare if this was scrapped. This would be a major gut punch for the Tesla bull thesis over the next few years.”
(Reporting by Zaheer Kachwala, Harshita Varghese, Priyanka G and Purvi Agarwal in Bengaluru; Editing by Sriraj Kalluvila)
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