Featured image: Tesla | Tesmanian

Electric vehicles are a critical element of the world's transition to sustainable energy and to the solution for improving the climate situation. However, their high cost is the main obstacle itself. Tesla's team works long and hard, constantly, to reduce the price of their cars. One major focus is on achieving a reduction in the cost of producing batteries so that the final cost of its cars is lower.

During Battery Day, it was announced that the company was able to achieve a stunning 56% $/kWh reduction. Tesla also announced that, within 3 years, the company will present a new model that will cost just $25,000.

From this major announcement, it was unclear where exactly Tesla was going to develop its new model. But it is clear that this affordable model has the potential to conquer the mass market, whether for electric or gas-powered vehicles. And now, Elon Musk has clarified the locations for production.

According to Musk, the new model, which will be smaller than Model 3, will be developed in both China and Germany. That is, R&D centers in these countries will develop their own bespoke, affordable models.

Both will do original cars

— Elon Musk (@elonmusk) September 28, 2020

All current models have been developed by Tesla in Fremont, so creating new models outside of the US is an exciting prospect.

Speaking to the media at the Shanghai Auto Show on September 28, Tesla Vice President Grace Tao said the company is accelerating localization.

"We are also hiring a lot of R&D, design, software, and hardware personnel in China," she said.

"On the one hand, we want to be closer to the consumer demand of Chinese residents. On the other hand, it's also about leveraging our domestic R&D and design capabilities to develop product features that are more suitable for China," Tao said.

This hints that the new model, created in China, will primarily focus on the domestic market and the needs of local customers. At the same time, this can also be evidence that the model created in the Berlin R&D Center will be crafted with the European market specifically in mind.

© 2020, Eva Fox. All rights reserved.

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Article edited by @SmokeyShorts, you can follow him on Twitter

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