Undated handout photo of Tesla Inc's Model Y electric sports utility vehicle
Undated handout photo of Tesla Inc's Model Y electric sports utility vehicle
Undated handout photo of Tesla Inc's Model Y electric sports utility vehicle
Undated handout photo of Tesla Inc's Model Y electric sports utility vehicle

San Francisco - Tesla pulled the covers off its much-awaited Model Y electric crossover vehicle on Thursday, promising that it will be a formidable rival to the new wave of electric SUVs emanating from Europe.

Based on the Model 3 sedan, the Model Y will serve as a more affordable alternative to the current Model X performance SUV. 

Chief Executive, South African born Elon Musk, said that the Model Y would first debut in a long-range version that can achieve a claimed range of 482km between charges, priced at $47 000 (R680 000). A 'standard' version, to be available sometime in 2021, would cost $39 000 (R565 000), with a 370km range. The vehicles can be configured to include 7 seats, for an additional $3000 (R4800).

But like many modern EVs, the new crossover promises some driving excitement too, with top models capable of sprinting from zero to 60mph (96km/h) in just 3.5 seconds, according to Tesla.

Following the event, Tesla's website included a page to "design and order" the more expensive, long range version of the vehicle with rear-wheel drive, available next year. Ordering the car requires a $2500 (R36 250) refundable deposit. Interestingly, South Africa is not listed on the order page, although it was listed when the Model 3 was revealed. At this stage it has yet to be fully confirmed whether SA will get the Tesla brand, although late last year Musk did state, in reply to a Tweet, that a Tesla store might open in the country during 2019.

Musk unveiled the Model Y at a short 40-minute event at Tesla's design studio in Hawthorne, outside Los Angeles, that was streamed live online. 

Small SUVs are the fastest-growing segment in the United States and China,where Tesla is building a factory, making the Model Y well positioned to tap demand. Tesla has enjoyed little competition thus far for its sedans, but competition for electric SUVs is heating up as Tesla tries to master a new set of economics from the luxury line that made its reputation.

On Thursday, ratings company Fitch warned that, despite Tesla's early lead, "incumbent carmakers have the ability to catch up ... thanks to their capacity to invest and their robust record in product management."

Tesla's targeted volume production date of late 2020 for the Model Y would put it behind electric SUVs from Audi, Mercedes-Benz and BMW.

"Twelve months from now we will have made about 1 million vehicles," Musk said at the event, without specifying the breakdown of models.

Musk has promised an easier production ramp of the Model Y (following much-publicised problems with the Model 3) as it shares about three-quarters of its parts with the aforementioned sedan and would need only half the capital expenditures of the sedan. The risk is "quite low" Musk told analysts in January. 

IOL & Reuters