Leaked: Affordable Tesla Model Y Variant in the Works, Launch Expected Q4 2025

Tesla is preparing to launch a more affordable version of its best-selling Model Y, and newly leaked images from Chinese auto blog Garage 42 give us our first glimpse. This stripped-down variant aims to retain Tesla’s core strengths while trimming away non-essential luxury features to hit a lower price point—a strategic move as competition in the EV space intensifies.

Major Cost-Cutting Changes Revealed

The leaked interior photos show Tesla is making notable reductions:

The signature full panoramic glass roof is gone, replaced with a simpler setup to cut materials and costs.

The rear entertainment screen has been removed.

The center console has been redesigned with a pass-through layout for a more open front cabin.

Interestingly, Tesla has brought back traditional steering column stalks, which were removed in newer versions of the Model Y and Model 3 Highland.

On the exterior, more simplifications are visible:

The sleek front light strip has been eliminated.

The headlights appear repositioned higher on the fascia.

Around back, taillights are expected to lose the center reflective strip, further reducing complexity and cost.

These calculated design changes are part of Tesla’s push to make manufacturing more efficient while still delivering on performance, software, and charging.

Competition is Heating Up in China

Despite Tesla’s dominance in China’s premium EV segment, the pressure is mounting. In H1 2025, Tesla sold 171,491 Model Y units, impressive but closely trailed by the Xiaomi SU7, which clocked in at 155,692 units. Xiaomi has also introduced the new YU7, amassing 200,000 pre-orders, signaling serious competition.

Rival automakers including XPeng, Li Auto, and Nio (via Onvo) are all prepping major EV releases for the second half of 2025. With competitors improving design, performance, and pricing, Tesla’s value proposition is no longer as unique as it once was.

Elon Musk Confirms Simplified Model Y Strategy

During a recent earnings call, Tesla CEO Elon Musk confirmed that the company’s upcoming affordable EV would not be a completely new model, but rather a streamlined version based on the Model Y platform. Chinese media reports that production for this version is already underway, and the official launch is expected in Q4 2025.

Despite the stripped-back design, Tesla promises the new variant will still offer:

✅ Instant acceleration

✅ Minimalist, intuitive software

✅ Access to Tesla’s Supercharger network

Whether buyers are willing to trade premium features for a more attractive price remains to be seen—but Tesla is betting big that they will.