By Michael Elkins
According to a report by Reuters on Monday, American electric vehicle maker, Tesla (NASDAQ:TSLA) is developing a revamped version of the company’s model 3. The EV maker aims to cut production costs and boost the appeal of the five-year-old electric sedan.
According to four people with knowledge of the situation, one focus of the redesign is to reduce the number of components and complexity in the interior of the Model 3 while focusing on features that Tesla buyers value, including the display, according to the people, who asked not to be named because the revamp has not been announced.
The redesign, codenamed "Highland," comes as the electric sedan faces increased competition from the likes of China's BYD (OTC:BYDDY), Hyundai (OTC:HYMLY) and coming releases from other major automakers.
Two people said that the revamp will go into production at Tesla’s factory in Shanghai and the company’s Fremont, California plant. They said that Tesla’s Shanghai Gigafactory will put the redesigned Model 3 into production in the third quarter of 2023.
The Model 3 has been the automaker’s best-seller but is being overtaken by the Model Y crossover. The company only has four models in production, so styling changes to the lineup carry more importance when compared to established automakers.
Ed Kim, president of AutoPacific Group said the current Model 3 has already been updated from the version that first went on sale in 2017 because of the way Tesla updates battery performance, information, and entertainment options through software, even if it still looks the same.
“Having said that, consumers still tend to equate visual changes with newness,” he said. “Tesla knows visually tangible changes are in order.”
“The upcoming changes that potential customers can see and feel will be very important in ensuring that EV customers still have Tesla at the top of their minds as truly excellent alternatives to Tesla are starting to flood the market,” he said.
Shares of TSLA are down 2.08% in pre-market trading on Monday.