Elon Musk's Tesla posted a pair of social media videos over the weekend that tease an unspecified announcement for Tuesday.
Tesla's main account on X, the Musk-owned social media platform, posted a video early Sunday morning of a wheel or fan showing Tesla's logo starting to spin before accelerating.
The video then goes to black with the date 10/7 displayed, suggesting an announcement of some sort on Oct. 7.
Tesla posted a second video later on Sunday that showed a car's headlights on with the body of the vehicle cloaked in darkness. Tesla shares rose in anticipation of the announcement, climbing more than 4% in Monday trading.
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The teaser videos follow Tesla's record third-quarter deliveries, which were driven by a surge in EV purchases ahead of the expiration of the federal government's $7,500 EV tax credit on Sept. 30.
Despite the boost from a strong third quarter, analysts expect Tesla's annual deliveries to decline for a second consecutive year to about 1.62 million vehicles, amid less demand due to the expiration of EV purchase incentives as well as political headwinds from Musk's work with the Trump administration.
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Tesla previously delayed the rollout of a lower-cost version of the Model Y in the U.S. to help spur more demand amid sluggish sales of EVs.
The company said in June it had made "first builds" of the vehicle but would start selling it in the fourth quarter and ramp up output at a pace that would be slower than planned.
The stripped-down version is designed to be about 20% cheaper to produce than the refreshed Model Y and could scale to about 250,000 units a year in the U.S. by 2026.
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Wall Street expects Tesla's deliveries to rebound to 1.85 million vehicles next year, with the cheaper model accounting for 155,610 units in 2026, per estimates from Visible Alpha.
"Tesla is teasing something big as a flurry of X posts has fans bracing for what looks like the launch of a more affordable Model Y tomorrow," said Matt Britzman, senior equity analyst at Hargreaves Lansdown, who personally owns Tesla shares.
"The price tag will be the real tell, offering clues on how far Tesla has pushed cost savings and how much new demand it can unlock," Britzman added.
Tesla hasn't launched a new mass-market vehicle in years and has instead relied heavily on making incremental updates to the Model 3 and Model Y to drive sales.
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The last major new vehicle launch by Tesla was the Cybertruck, which has struggled with soft sales that have prompted Tesla to offer thousands of dollars in discounts for vehicles in inventory in recent months.
A recall filing from March showed that 46,096 Cybertrucks have been built between its introduction in November 2023 and early this year.
Reuters contributed to this report.
