Tesla’s been undergoing some major changes, and now we have a sense of why: The company says it is upending its product roadmap because of “pressure” on EV sales.

The new and accelerated plan now includes “more affordable models” that the company claims will be launched next year. Or if Tesla CEO Elon Musk is to be believed — and that’s a big bet considering his track record with timelines — possibly as early as the end of 2024.

The shock announcement sent the company’s stock soaring more than 11% in after-hours trading Tuesday. And the price didn’t fall even as Musk and other Tesla executives refused to share further details on a call with investors.

This all comes following a bombshell report in early April from Reuters that claimed Tesla had abandoned its work on a low-cost, next-generation car. That next-gen car was meant to be built on the same EV platform Tesla is developing for its supposed robotaxi vehicle. Tesla had said this next-gen car could come as early as late 2025.

While Musk flimsily claimed Reuters was “lying,” both Electrek and Bloomberg News have since reported that the development of that particular EV has been delayed or deemphasized inside the company. Musk has since posted on social media site X that Tesla will reveal the robotaxi August 8.

Tesla provided the update in its less-than-stellar first-quarter earnings report, which showed profits falling 55% year-over-year. The company said in the report it had “updated [its] future vehicle line-up to accelerate the launch of new models ahead of our previously communicated start of production in the second half of 2025.” The slate of new vehicles includes “more affordable models,” the company said.

These new offerings are not being spun out of whole cloth, though. Tesla says it will build these vehicles on existing production lines and that they will “utilize aspects of” the next-generation platform it has been developing, “as well as aspects of our current platforms.”

Bloomberg News reported earlier this week Tesla was working on new versions of the Model Y and Model 3 that borrowed technology and processes from the next-gen EV, with an emphasis on the Model Y.

Tesla investors will have to wait to learn any more.

On a call with investors, Musk punted on the question of what Tesla’s new product roadmap actually involves. “We’ll talk about this on August 8th,” he said, referring to the event Tesla has planned to reveal its robotaxi, which he called “Cybercab.”

When asked a similar question later in the call, Musk said “I think we’ve said all we will on that front.”

Tesla VP Lars Moravy said there was “some risk” associated with the new platform, and that Tesla could leverage “all the subsystems” being developed for it, like powertrains, drive units, as well as improvements in manufacturing and automation, thermal systems, seating,” and more. “All that’s transferrable, and that’s what we’re doing — trying to get it in new products as fast as possible,” he said. “That engineering work — we’re not trying to just throw it away and put it in a coffin.”

Cost versus growth

Tesla has worked to reduce the cost of manufacturing the next-gen EV by 50% compared to the platform that underpins the Model 3 and Model Y.

The company admitted Tuesday that by shifting to a strategy of mixing the next-gen technology and processes with existing platforms and manufacturing lines, it will lose some of that cost savings.

The upside, according to Tesla, is growth. The company claims it can double 2023’s production (which was around 1.8 million vehicles) by 2025. And while it won’t save as much on the cost of the cars, it also won’t have to build new production lines to make these mysterious new vehicles. The company has already slowed work on a new factory in Mexico, where it originally planned to start building the next-generation EV and robotaxi.

Of course, Tesla had said for years that it expected to reach 50% annual growth, averaged over a few years, and has consistently missed that target. As the company warned, it will grow at a “notably lower” rate this year.

There are other challenges as well. Tesla is claiming it can launch this new product lineup after axing a huge number of employees from its global workforce — though Musk said Tuesday the company is “not giving up anything significant that I’m aware of.”

“We’ve just had a long period of prosperity from 2019 to now,” Musk said on the call. “We’ve made some corrections along the way, but it is time to reorganize the company for the next phase of growth.”