Cheaper Tesla Model Y launches in US: What to know

Tesla denies it's searching for new a CEO

The Tesla board has begun a search for a new CEO to replace Elon Musk, according to a report from The Wall Street Journal. But both Tesla and Musk deny the report. This report comes as Musk was allegedly preparing to step down from his role at the Department of Government Efficiency in the coming weeks. Dr. Doug Millburn, President of 45Drives and chairman of Protocase companies, joins LiveNOW's Andrew Craft to discuss the latest.

Tesla is launching a cheaper version of its best-selling Model Y SUV. 

The company has started taking orders for the rear-wheel drive Model Y in the U.S. Tesla hopes the U.S. launch will help recoup the big profit cuts Tesla has seen since CEO Elon Musk dove into right-wing politics, but according to The Verge, the cheaper SUVs haven’t made much of a dent since their rollout in Europe. 

Cheaper Tesla Model Y

By the numbers:

According to The Verge, the cheaper Model Y costs $45,990, but after $7,500 in federal tax credits, the cost goes down to $37,490. That makes it the second-cheapest Tesla EV. The RWD Model 3 remains the cheapest. 

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The new Model Y comes with 357 miles of range, or 30 miles more than the all-wheel drive Model Y. It has a single motor on the rear axle and goes from 0 to 60 in 5.4 seconds. The AWD goes from 0 to 60 in 4.6 seconds.  

Tesla Model Y electric vehicles are collected from the Tesla Gigafactory Berlin-Brandenburg (Photo by Patrick Pleul/picture alliance via Getty Images)

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Timeline:

Tesla says delivery will start on the new Model Y line in a few weeks.

Tesla’s profits plunge

Dig deeper:

Tesla has struggled to sell vehicles as it faces angry protests over Musk’s leadership of DOGE, a jobs-cutting group that has divided the country. The Austin, Texas, company reported a 71% drop in profits and a 9% decline in revenue for the first quarter.

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Tesla said quarterly profits fell from $1.39 billion to $409 million, or 12 cents a share. That’s far below analyst estimates. Tesla’s revenue fell from $21.3 billion to $19.3 billion in the January through March period, also below Wall Street’s forecast. Tesla’s gross margins, a measure of earnings for each dollar of revenue, fell from 17.4% to 16.3% .

What's next:

In addition to rolling out the cheaper Model Y, Tesla also predicts it will be able to launch a paid driverless robotaxi service in Austin in June and have much of its fleet operating by itself next year.

What they're saying:

"There will be millions of Teslas operating autonomously in the second half of the year," Musk said in an April conference call after the Q1 results were announced. "Can you go to sleep in our cars and wake up at your destination? I’m confident that will be available in many cities in the U.S. by the end of this year."

The other side:

Auto analysts doubt Musk’s projections. 

"The system is not robust enough to operate unsupervised. It still makes far too many errors," Telemetry Insight auto analyst Sam Abuelsamid told The Associated Press. "It will suddenly make mistakes that will lead to a crash."