Tesla Launches Model Y Standard Production at Berlin Factory

Tesla has officially begun production of the Model Y Standard at its GigaFactory in Berlin, Germany. This announcement was made on a Monday, marking a significant milestone for the company’s manufacturing efforts in Europe. The commencement of production was shared on Tesla’s ‘Manufacturing’ X account, highlighting the launch’s importance.

New Affordable Lineup

The Model Y Standard Rear-Wheel Drive is priced at $39,990, making it $5,000 more affordable than the previous cheapest Model Y available in the U.S. market, which was $44,990. Another model, the Model 3 Standard, has a starting price of $36,990. The Model Y Standard was officially launched in Europe on October 10, while the Model 3 Standard variant’s introduction in the European market remains unannounced.

Cost-Cutting Measures

To reach the new lower price, Tesla has removed several features from the Standard models. Key omissions include:

• Rear passenger screen
• Glass roof
• Ambient lighting

In the U.S., the Autopilot steer feature has also been eliminated, directing customers to consider purchasing or subscribing to Tesla’s Full Self-Driving software. Despite these adjustments, Tesla’s Design Chief, Franz von Holzhausen, emphasizes the quality and value of the Model Y Standard, stating, “I think you get more than what you pay for.” Both Standard variants offer an estimated range of 321 miles (516 kilometers), which is about 35 to 40 miles less than their Premium counterparts.

Market Reception and Analyst Views

The initial deliveries of the Model Y Standard in the U.S. occurred in the previous month. However, reactions from Wall Street analysts have varied. Dan Ives from Wedbush expressed disappointment, noting that the pricing is only $5,000 lower than earlier versions of the Model 3 and Y. Similarly, Mark Delaney from Goldman Sachs raised concerns about the lack of significant differentiation in price and features for the Standard trims, which was expected to be more pronounced in Tesla’s lower-cost models.

Global Production Strategy

While the start of production in the U.S. has not been confirmed, deliveries are anticipated to begin between December and January. CEO Elon Musk previously indicated uncertainty about U.S. production timelines for this variant, stating that it might not commence until late next year and might not happen at all due to advancements in self-driving technology in America.

Expanding Model Y Portfolio

Tesla has been actively expanding its Model Y lineup globally. A three-row version was launched in China in August, which has seen robust demand. Orders for this model sold out for October deliveries by September 10, with prospective buyers now facing estimated delivery dates extending into December.