Tesla said: “Because of the large market size of SUVs and higher average selling prices, we believe that Model Y will be a more profitable product than Model 3.”
Electric car manufacturer Tesla confirmed today that the company began to prepare for the production of Model Y at the Fremont plant in the second quarter of this year. The production of Model Y is expected to begin in the fall of 2020.
Tesla began accepting reservations when it launched Model Y in March. The company said it would start delivering new cars as early as 2020. At the time, Tesla did not disclose the production plan for its new electric vehicle.
But in April, Tesla CEO Elon Musk talked about Model Y’s production plan in the first quarter earnings report in 2019. “For Model Y, we are now trying to decide if it will still be produced in Nevada. We expect to make a final decision soon.”
Since then, there have been many signs that Tesla is focusing on producing Model Y in Fremont. Today, Tesla released its second quarter earnings report for 2019. The company then mentioned the Model Y production plan.
The company said in its earnings report: “Preparation for the production of Model Y at the Fremont plant begins in the second quarter. Since many of the components of Model 3 and Model Y are versatile, we can leverage the development of the Model Y production facility. Some manufacturing designs. In addition, we are making progress in managing Model Y costs and expect a minimum cost premium over Model 3. Due to the large market size of SUVs and higher average selling prices, we believe Model Y will beat Model 3 as a more profitable product.”
As previously reported, Tesla is working on several major manufacturing design improvements that are expected to be introduced in Model Y production. They include revolutionary new wiring architectures and huge new casting machines.
When the Model Y was launched earlier this year, Tesla said the electric SUV starts at $39,000. The automobile has a cruising range of 370 kilometers and will provide up to 483 kilometers of battery life.