Tesla Confirms Cheaper EV Model for 2016, Musk Says it will Cost Half the Price of Model S

Elon Musk, the visionary entrepreneur behind PayPal, SpaceX and Tesla Motors, has provided some new information while also confirming other details about his automotive venture’s plans, during Tesla Motor’s annual shareholder meeting on Tuesday.

Perhaps the most important bit of news shared by Musk was the confirmation of a smaller battery-powered model, currently known as the Gen III. “It will probably arrive at the end of 2016 I would say – the third generation vehicle, or the vehicle that is in a lot of ways a smaller version of the Model S at about half the price”.

Given that the base price of the Model S is $62,400, including the $7,500 Federal Tax Credit, the Gen III sedan should come in the market priced at around $30,000 to $35,000 with tax credits, or in the high $30k’s to low $40k’s without.

The Tesla CEO also talked about the upcoming Model X, which is an all-electric crossover with seating for seven based on the running gear of the Model S.

“Because the battery is in the floor pan, it should have the lowest center gravity of any SUV and as a result, extremely good handling,” Musk said. “So we want to have something that has the handling of a sports car and also looks great, but has more functionality than a minivan. That’s what we’re aiming for with the Model X We’re aiming to have initial cars in customer hands at the end of next year,” he added.

Musk said that the company is also preparing a China specific version of the Model S as well as another version of the car for the rest of Asia, both of which will be introduced this year.

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