News
Tesla’s vehicle manufacturing cost in 2017 was $84k per car – it has since dropped to $36k
During Tesla head of investor relations Martin Viecha’s talk at the recently-held invite-only Goldman Sachs tech conference in San Francisco, the executive shared several important tidbits of information that are pertinent to the EV maker’s plans for the future. These include, among other things, a “third revolution” of sorts in automotive manufacturing.
Viecha noted that in the past 120 years or so of the automotive industry, there have only been two revolutions in vehicle manufacturing. One of these happened in the early 1900s when Ford launched the Model T, and the other happened in the 1970s, when Toyota, through hard work and optimization, figured out a way to optimize vehicle production costs.
But electric vehicles are a completely different animal, so the opportunity for yet another vehicle manufacturing revolution is there. “EV architecture is so different from the internal combustion engine. It allows for a third revolution in automotive manufacturing,” Viecha said.
The Tesla executive stressed why it’s important for automakers to optimize their manufacturing costs, noting that the per-vehicle cost of production would be the most important metric to monitor in the EV sector in the coming years. This, according to Viecha, would be the deciding factor that would determine how many cars companies can make — and how big carmakers can become.
Tesla has made a lot of headway in this sense. According to Viecha, it cost Tesla $84,000 to produce each car in 2017. In recent quarters, this number has been reduced to $36,000 per vehicle. What’s important to note here is that almost none of these savings were actually from cheaper battery costs — they were simply the result of Tesla’s continuous efforts to improve its vehicle design to make manufacturing as simple as possible. The introduction of factories that are specifically designed for EV production also helped a lot.
Both of Viecha’s points could be seen in Tesla’s strategy in recent years. With the Model Y, Tesla started its use of megacasts, which drastically reduced the number of components used in producing a vehicle. Tesla’s use of megacasts has seen immense praise, and other carmakers such as Volvo have hinted that they also intend to follow a similar strategy in the near future.
Tesla’s Fremont Factory is a perfect example of Viecha’s second point. The plant, which Tesla acquired in 2010, is a facility that was not designed in any way for EVs. Tesla’s newer factories like Gigafactory Shanghai, Giga Berlin, and Gigafactory Texas, on the other hand, are specifically built to optimize the production of all-electric vehicles. The output of Giga Shanghai, which has recently surpassed the Fremont factory, is proof that Tesla’s dedicated EV factory idea is sound.
What’s interesting is that Tesla is a company that is known to push innovation even as its vehicles are already leading the industry. This was something that was hinted at by the Tesla executive, who noted that as the company’s new factories produce more cars, the manufacturing costs per vehicle could drop even lower than $36,000 — and that’s before the lion’s share of battery savings from the company’s 4680 program kick in.
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News
Tesla looks to upgrade Matrix Headlights with new features
According to the update, Tesla will work on improving the headlights when coming into contact with highly reflective objects, including road signs, traffic signs, and street lights. Additionally, pixel-level dimming will happen in two stages, whereas it currently performs with just one, meaning on or off.
Tesla is looking to upgrade its Matrix Headlights, a unique and high-tech feature that is available on several of its vehicles. The headlights aim to maximize visibility for Tesla drivers while being considerate of oncoming traffic.
The Matrix Headlights Tesla offers utilize dimming of individual light pixels to ensure that visibility stays high for those behind the wheel, while also being considerate of other cars by decreasing the brightness in areas where other cars are traveling.
Here’s what they look like in action:
- Credit: u/ObjectiveScratch | Reddit
- Credit: u/ObjectiveScratch | Reddit
As you can see, the Matrix headlight system intentionally dims the area where oncoming cars would be impacted by high beams. This keeps visibility at a maximum for everyone on the road, including those who could be hit with bright lights in their eyes.
There are still a handful of complaints from owners, however, but Tesla appears to be looking to resolve these with the coming updates in a Software Version that is currently labeled 2026.2.xxx. The coding was spotted by X user BERKANT:
🚨 Tesla is quietly upgrading Matrix headlights.
Software https://t.co/pXEklQiXSq reveals a hidden feature:
matrix_two_stage_reflection_dip
This is a major step beyond current adaptive high beams.
What it means:
• The car detects highly reflective objects
Road signs,… pic.twitter.com/m5UpQJFA2n— BERKANT (@Tesla_NL_TR) February 24, 2026
According to the update, Tesla will work on improving the headlights when coming into contact with highly reflective objects, including road signs, traffic signs, and street lights. Additionally, pixel-level dimming will happen in two stages, whereas it currently performs with just one, meaning on or off.
Finally, the new system will prevent the high beams from glaring back at the driver. The system is made to dim when it recognizes oncoming cars, but not necessarily objects that could produce glaring issues back at the driver.
Tesla’s revolutionary Matrix headlights are coming to the U.S.
This upgrade is software-focused, so there will not need to be any physical changes or upgrades made to Tesla vehicles that utilize the Matrix headlights currently.
Elon Musk
xAI’s Grok approved for Pentagon classified systems: report
Under the agreement, Grok can be deployed in systems handling classified intelligence analysis, weapons development, and battlefield operations.
Elon Musk’s xAI has signed an agreement with the United States Department of Defense (DoD) to allow Grok to be used in classified military systems.
Previously, Anthropic’s Claude had been the only AI system approved for the most sensitive military work, but a dispute over usage safeguards has reportedly prompted the Pentagon to broaden its options, as noted in a report from Axios.
Under the agreement, Grok can be deployed in systems handling classified intelligence analysis, weapons development, and battlefield operations.
The publication reported that xAI agreed to the Pentagon’s requirement that its technology be usable for “all lawful purposes,” a standard Anthropic has reportedly resisted due to alleged ethical restrictions tied to mass surveillance and autonomous weapons use.
Defense Secretary Pete Hegseth is scheduled to meet with Anthropic CEO Dario Amodei in what sources expect to be a tense meeting, with the publication hinting that the Pentagon could designate Anthropic a “supply chain risk” if the company does not lift its safeguards.
Axios stated that replacing Claude fully might be technically challenging even if xAI or other alternative AI systems take its place. That being said, other AI systems are already in use by the DoD.
Grok already operates in the Pentagon’s unclassified systems alongside Google’s Gemini and OpenAI’s ChatGPT. Google is reportedly close to an agreement that will result in Gemini being used for classified use, while OpenAI’s progress toward classified deployment is described as slower but still feasible.
The publication noted that the Pentagon continues talks with several AI companies as it prepares for potential changes in classified AI sourcing.
Elon Musk
Elon Musk denies Starlink’s price cuts are due to Amazon Kuiper
“This has nothing to do with Kuiper, we’re just trying to make Starlink more affordable to a broader audience,” Musk wrote in a post on X.
Elon Musk has pushed back on claims that Starlink’s recent price reductions are tied to Amazon’s Kuiper project.
In a post on X, Musk responded directly to a report suggesting that Starlink was cutting prices and offering free hardware to partners ahead of a planned IPO and increased competition from Kuiper.
“This has nothing to do with Kuiper, we’re just trying to make Starlink more affordable to a broader audience,” Musk wrote in a post on X. “The lower the cost, the more Starlink can be used by people who don’t have much money, especially in the developing world.”
The speculation originated from a post summarizing a report from The Information, which ran with the headline “SpaceX’s Starlink Makes Land Grab as Amazon Threat Looms.” The report stated that SpaceX is aggressively cutting prices and giving free hardware to distribution partners, which was interpreted as a reaction to Amazon’s Kuiper’s upcoming rollout and possible IPO.
In a way, Musk’s comments could be quite accurate considering Starlink’s current scale. The constellation currently has more than 9,700 satellites in operation today, making it by far the largest satellite broadband network in operation. It has also managed to grow its user base to 10 million active customers across more than 150 countries worldwide.
Amazon’s Kuiper, by comparison, has launched approximately 211 satellites to date, as per data from SatelliteMap.Space, some of which were launched by SpaceX’s Falcon 9 rocket. Starlink surpassed that number in early January 2020, during the early buildout of its first-generation network.
Lower pricing also aligns with Starlink’s broader expansion strategy. SpaceX continues to deploy satellites at a rapid pace using Falcon 9, and future launches aboard Starship are expected to significantly accelerate the constellation’s growth. A larger network improves capacity and global coverage, which can support a broader customer base.
In that context, price reductions can be viewed as a way to match expanding supply with growing demand. Musk’s companies have historically used aggressive pricing strategies to drive adoption at scale, particularly when vertical integration allows costs to decline over time.

