Elon Musk says Model Y small SUV will leverage Model 3 platform after all

During its earnings call in May, Tesla CEO and founder Elon Musk said that the “Model Y” (whose name isn’t yet actually finalized, he noted) small SUV actually would use a brand new platform, totally distinct from the Model 3. On the earnings call for the company’s Q3 results on Wednesday, he noted that the company has changed its thinking, and that the Model Y will in fact leverage the Model 3 platform considerably.

“Upon the counsel of my executive team, the Model Y will in fact be using substantial carry-over from Model 3 in order to bring it to market faster,” Musk said, noting that in the interest of serving both the markets for affordable sedans and affordable SUVs (which is actually larger), it makes more sense in the near-term to make use of work it’s already done on the Model 3 instead of spinning up a brand new platform and resulting distinct production process.

“I still think we want to do the crazy thing in the future,” he added, referring to the idea of developing a brand new platform specifically for an SUV. “But we will want to punt that until after the compact SUV.”

It sounds like the change of strategy might be related to the “production hell” Musk has frequently referred to regarding the Model 3 and its manufacturing ramp. Tesla noted in its investor letter on the earnings that it would be focusing on increasing volume for Model 3 drive components and battery cells at Gigafactory 1, and once it achieves successful scale manufacturing of those parts, they should help considerably with fielding the affordable compact SUV Tesla hopes to add to its lineup next.