Recently, Tesla's head of investor relations Martin Viecha Martin Viecha spoke at the Goldman Sachs Technology Conference, disclosing the effect of Tesla in reducing manufacturing costs over the past few years and emphasizing that future car manufacturing costs still have room for decline.

 

As early as the 2020 Tesla Battery Day, Musk already revealed plans for a low-cost model, but shelved them for various reasons. Now that Azera has also announced that it will push a new sub-brand to go down to the lower-priced mass market, Tesla is also playing with the idea of going down to the market. Tesla's low-priced models are expected to be under 200,000 yuan, which will put some pressure on domestic new energy car companies.

 

 

In 2017, Tesla's manufacturing cost for a single vehicle was $84,000 (about RMB 585,000). Thanks to better vehicle design and a more streamlined manufacturing process, that number has dropped to $36,000 (about RMB 251,000) in recent quarters. It took Tesla only five years to reduce the cost of manufacturing a single vehicle by $48,000 (about 334,000 yuan), so I have to say that Tesla has a real knack for simplifying the production process to reduce manufacturing costs.

 

In the history of automobile manufacturing, the Ford Model T in the early 20th century and the "lean manufacturing" model created by Toyota in the 1970s were two major innovations in automobile manufacturing, both of which greatly reduced the cost of manufacturing and increased the popularity of automobiles. The Tesla executive believes that the electric vehicle architecture is so different from the internal combustion engine that it will be the third innovation in car manufacturing.

 

 

In addition to disclosing manufacturing costs, Wicha also laid out Tesla's growth trends for the next five years.

 

He described the Model X and S as Tesla's first-generation platforms, the Model 3 and Model Y as second-generation platforms, and the Robotaxi (driverless cab) platform will be the third-generation platform. He said Tesla is offering cheaper models before the self-driving cab service is launched. At Tesla's first quarter earnings meeting this year, Musk confirmed that the company's Robotaxi model will have a steering wheel or pedal-less design and is expected to be in mass production by 2024. So, it's a bold prediction that Tesla's lower-priced model might be with us in 2023.