Tesla is reportedly working on a smaller SUV that isn't based on the Model Y

According to a new report from Reuters, Tesla is currently working on a new compact SUV. This will allegedly be an entirely new car, and not one based on the Model Y and Model 3. It will be smaller than both of those, at 168.5 inches in length.

It's said to be in the early development stages, and is meant to be built in China when it does launch, which definitely won't be this year. Since it's smaller, it is also going to be cheaper than the Model 3 and Model Y - significantly so, in fact, due to the use of a smaller battery and just one motor. To compensate for that, the car will only weigh about 3,307 lb.

It's interesting to remember that Tesla was long rumored to be developing a lower-cost EV a few years ago (sometimes referred to as the Model 2), which was reportedly shelved by CEO Elon Musk in favor of the Robotaxi/Cybercab. Speaking of autonomous cars, the new project is likely to be human-driven and have an autonomous version.

One employee allegedly says the company now aims to build models that "would be driverless but offer a human-driven option". The duality stems from Tesla realizing that in many markets, self-driving vehicles won't be roaming the streets for many years to come. So by developing a model that's also suited to be driven by a human, the company can keep its factories running and prevent its sales numbers from collapsing in the next few years.