Tesla is reportedly planning to build a $27,000 electric car as a host of automakers grapple with boosting uptake of the eco-vehicles. 

A source familiar with matter told Reuters said the vehicle would be manufactured at Tesla’s factory near Berlin. They did not confirm when production would begin. 

If it came to fruition the car would be around half the price of an average vehicle which is currently around $47,899, according to September figures from Kelley Blue Book.

It comes after a host of carmakers have been forced to postpone or outright scrap a number of EV initiatives amidst concerns motorists will not pay the high price tags attached to the vehicles.

Last month, Ford announced it would delay a $12 billion of investment into EVs due to the ‘challenging market.’ And a $5 billion joint initiative between Honda and General Motors to create a more affordable electric car was also pulled. 

Tesla is reportedly planning to build a $27,000 electric car as a host of automakers grapple with boosting uptake of the eco-vehicles. Pictured: CEO Elon Musk at a conference in Paris, France, in June 2023

As of Tuesday midday, its shares were 16 percent down in the last month in the United States

Tesla declined to comment to Reuters. As of Tuesday midday, its shares were 16 percent down in the last month in the United States.

The company is aiming to make a vehicle that retails for 25,000 euros – or $26,838. 

Currently the cheapest Tesla Americans can buy is the Model 3 which retails at a starting price of $38,990 – though this is slashed down to just over $30,000 thanks to a $7,500 federal tax credit offered to buyers. 

The steep price tag of electric cars – compounded by high interest rates – is one of several factors holding back uptake of the technology in Europe and the United States, consumer surveys show.

Read Related Also: Human or not? AI tech has grown, but there are ways to spot fakes

The average retail price of an EV in Europe in the first half of 2023 was over 65,000 euros, according to autos research firm JATO Dynamics, compared to just over 31,000 euros in China.

What’s more there are concerns over the running costs of electric cars which tend to be more expensive to insure. The US is also struggling to adapt the appropriate infrastructure of charging networks. 

Experts previously told DailyMail.com that it can take as long as a decade for a motorist to break even on their initial investment into an EV. 

Currently the cheapest Tesla Americans can buy is the Model 3, pictured, which retails at a starting price of $38,990 – though this is slashed down to just over $30,000 thanks to a $7,500 federal tax credit offered to buyers

DailyMail.com analyzed data from insurance comparison site The Zebra and found that in various scenarios the approximate cost of insuring an electric car was more than the gas alternative

Musk had long planned to make a more affordable electric car but said in 2022 he had not yet mastered the technology and shelved the plan.

Still, sources told Reuters in September the carmaker was closing in on an innovation that would allow it to die cast nearly all of the underbody of the EV in one piece, a breakthrough that would speed up production and lower costs.

Chief Executive Elon Musk visited the plant in Gruenheide on Friday and thanked staff for their hard work, a video showed on Musk’s social media platform X.

At the same meeting, he informed staff of plans to build the 25,000-euro vehicle there, the source said.

The German plant currently produces the Model Y, Europe’s best-selling EV.