Elon Musk Confirms Tesla Model Y Will Be Produced At Fremont, California

Tesla CEO Elon Musk remains hopeful the company’s upcoming Tesla Model Y electric compact crossover SUV will start production by late 2020 -- but at the Tesla Factory in Fremont, California.

With an employee workforce of some 10,000 people, Freemont currently manufactures the Model S, Model X and Model 3. Questions are being asked if Fremont has the capacity to take on the Model Y. Musk answers in the affirmative.

“Right now our default plan actually is to produce the Y at Fremont,” said Musk during “Ride the Lightning,” an hour-long podcast hosted by Model 3 owner Ryan McCaffrey.

“I was skeptical about whether this made sense at first but my team convinced me the fastest way to get to volume production is to do the Y at Fremont.”

Up until this announcement, it wasn’t clear if Musk wanted to produce the Model Y at Fremont or at the Tesla Gigafactory 1 near Reno, Nevada. Gigafactory 1 produces battery packs and drive units for the Models S, 3 and X.

In 2018, Tesla produced more than 250,000 vehicles at Fremont. This is also where Tesla set-up a secondary production line for the Model 3 housed in a tent outside the factory. With this in mind, analysts are asking where Musk intends to set-up the Model Y production line.

Musk first unveiled the Model Y crossover at a Tesla event in March. Tesla’s move to SUVs is being driven by a simple marketing fact: Americans love SUVs and about seven in 10 vehicles sold in the U.S. are SUVs.

Tesla’s move into the SUV space, however, is belated and that’s due to a decision made by Musk to protect the Model 3.

As he explains it, “I intentionally didn’t go all out with the Model Y reveal because I didn’t want to convince people to buy a Y instead of a 3.”

“If everyone just decided to buy a Y instead of a 3 there would be no customers and there wouldn’t be a Y.”

In the podcast, Musk revealed the Model Y’s range will be 8% to 10% less than the Model 3. That means a range of about 300 miles.

As for price, the Model Y is expected to start at $48,000 (or $1,000 higher than originally announced). A low-cost version with 230 miles of range will follow. This iteration is expected to retail at $39,000.