Key Takeaways Tesla is set to produce and launch a lower-cost Model Y vehicle in China likely in 2026, Reuters reported Friday—citing people with knowledge of the matter.The vehicle will also eventually be launched in Europe and North America,

The stripped-down SUV is aimed at recovering market share from Chinese makers offering less-expensive models.

It looks increasingly likely that the much touted $25,000 entry level Tesla known colloquially as the Model 2 will not be built.