Tesla Still Unsure of Where it Will Build the Model Y Amid Cost-cutting & Layoffs

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【Summary】Tesla has still not decided on a manufacturing facility to build the upcoming Model Y crossover.

Manish Kharinta    Apr 15, 2019 11:00 AM PT
Tesla Still Unsure of Where it Will Build the Model Y Amid Cost-cutting & Layoffs
The Model Y teaser (Photo: Tesla)

Electric car pioneer Tesla is all set to officially unveil it's upcoming Model Y crossover on March 14 for the first time. The debut will take place at Tesla's design center in Hawthorne, California. However, Sources close to Tesla disclosed that the company has still not decided where it will build the Model Y, its first battery-powered crossover SUV.

Tesla CEO Elon Musk teased the unveiling in a Twitter post on March 3. Musk also disclosed that the Model Y will only cost about 10 percent more than the $35,000 base Model 3.

Tesla also has plans to build an electric pickup truck and it might be unveiled later this year. It seems that Tesla is expanding its lineup as a strategic move to keep its portfolio fresh and competitive against new entries in the electric vehicle space.

A crop of new EV startups like Rivian, as well as mainstream automakers Hyundai, Audi, VW, Mercedes Benz and BMW are making their way into the electric car space.

For Tesla, competition is on the rise.

The uncertainty stems from Tesla trying to figure out whether it wants to allocate a dedicated space in its Nevada Gigafactory for the production of Model Y or combine the body assembly lines of the Model X and Model S at its factory in Fremont, California to accommodate the Model Y's production line.

In an official letter, a spokesperson for Tesla hinted that Model Y will most likely be manufactured at Gigafactory to meet the volume production target by the end of 2020. The letter also confirmed that Tesla will start retooling the plant for Model Y production later this year.

Tesla will use the Model 3 as a platform for the Model Y. In the company's Q4 update last week, Tesla said that the Model Y will share up to 75 percent of its components with the Model 3.

The company is in the process of employee layoffs and other cost-cutting measures to turn a profit.

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