Tesla stock slumps after initial jump on X posts teasing product launch, reported to be cheaper Model Y
Shares in Elon Musk’s Tesla (TSLA) slumped in Tuesday morning trading after the electric vehicle maker revealed that its new product, hinted at in a series of cryptic posts on X on Sunday, is a stripped-down and cheaper version of its Model Y SUV.
Tesla shares gained more than 5.4% by the closing bell on Monday after the EV maker posted gifs on Sunday of a spinning company logo with the date “10/7” and of what appeared to be car headlights shining through smoke.
The stock moved down by more than 1% in the first hour after Tuesday’s opening bell.
The stripped-down Model Y — which will “lack certain features and use less premium materials to offset the loss of the up to $7,500 federal tax credit,” according to Bloomberg — is the first major product announcement since October 2024, when Telsa unveiled its self-driving “Robotaxi.”
The new Model Y unveiling comes after another positive development for the electric vehicle maker. On Oct. 2, Tesla reported that EV deliveries in the three months through September had jumped by 7% over the same period last year and beat Wall Street expectations.
The deliveries gains have been at least partially attributed by analysts to the expiry at the end of September of the federal electric vehicle tax credit. Rival EV makers such as Rivian (RIVN) also posted heightened figures for the period.
Deliveries for Teslas suffered throughout the first half of 2025 as Musk spent much of his time in Washington, embroiled in on-again, off-again politics with the Trump administration. Deliveries for the first and second quarters of 2025 were down roughly 13% and 13.4% year over year, respectively, according to Tesla disclosures.
Tesla is set to report earnings on Oct. 22, with the company’s annual shareholder meeting to follow on Nov. 6.
Jake Conley is a breaking news reporter covering US equities for Yahoo Finance. Follow him on X at @byjakeconley or email him at jake.conley@yahooinc.com.
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