According to a report from Reuters, Tesla is delaying the launch of a more affordable electric vehicle by several months. The new model, believed to be a stripped-down version of the Model Y, was initially expected to debut in the first half of this year but may now be postponed until late 2025 or early 2026.

This development comes as Tesla’s sales continue to decline in various parts of the world, largely due to an aging vehicle lineup, CEO Elon Musk’s polarizing politics and involvement in the U.S. government, as well as the underwhelming performance of the Cybertruck.

The concept of a more affordable Tesla was first introduced by Elon Musk at the company’s “Battery Day” event in 2020, where he proposed the idea of a $25,000 Tesla. At the time, Tesla was developing a new platform that would be 50% cheaper to produce, which was intended to power this new model, often referred to as the “Model 2,” as well as the company’s proposed robotaxi.

However, Musk eventually abandoned the idea of building a car on the new platform. Instead, he reportedly shifted Tesla’s focus towards developing more affordable versions of the Model Y SUV and Model 3 sedan.