Tesla's new model will be built on a 3rd generation platform. According to New Street Research, this will lead to $400 billion in auto revenues in 2030. The firm thinks the new model is critical for Tesla's continued success.
Ahead of Tesla Investor Day, New Street Research shared its expectations for a big announcement. Pierre Ferragu, managing partner at the firm, said the new model is crucial for Tesla's success. The firm expects it to be 15% shorter, 30% lighter, and have a 25% smaller battery than the current Model 3.
New Street Research expects the new model to be 37% cheaper to produce than the Model 3. This is partly due to the smaller size of the car and partly due to design, architecture, and manufacturing innovations. The firm expects the new model to cost $25,000 and cover 80% of the automotive market, allowing Tesla to exceed 12 million vehicles and $400B in auto revenues in 2030.
The new model will have a lower cost, FSD support, and superior range and performance compared to the Toyota Corolla. It will give Tesla an edge over its competitors, just like the Model 3 does over the Honda Accord. This will also mean a gross margin of over 20% compared to mid-single digits for Corolla.
With the new model and FSD increasing in the mix, Tesla will be able to maintain gross margins of 30% for cars. Overall, New Street Research believes that the new model will be critical to Tesla's continued success and growth in the automotive market.
Armen Hareyan is the founder and the Editor in Chief of Torque News. He founded TorqueNews.com in 2010, which since then has been publishing expert news and analysis about the automotive industry. He can be reached at Torque News Twitter, Facebok, Linkedin and Youtube.