• Tesla launched a redesigned Model Y in China with a revamped Cybertruck-like look.
• The new model comes as Tesla reported a year-over-year sales decline amid EV market challenges.
• It's similar to Apple's approach to improving a product rather than creating a new one.

Tesla's new look for the Model Y in China has a Cybertruck-like design, a noticeable change that could be just what Tesla needs to refresh its aging car lineup.

Tesla's new Model Y boasts a redesigned exterior, along with updated suspension, wheels, and tires. It's also quieter and more efficient and has an 8-inch rear touchscreen. The company said on its website that it includes "soft-touch textiles" that give passengers the feeling that they're "floating in space," drawing inspiration from other futuristic Tesla designs.

It's not far off from Telsa's Model 3 redesign in 2023, which introduced a more luxurious and minimalist aesthetic. The upgrade similarly featured a quieter cabin and a rear screen display. The front end was made sleeker with slimmer headlights and a new wheel design. It also came with a redesigned dashboard and steering wheel.

While the new Model Y's design isn't nearly as radical as completely new models like the Cybercab or Cybertruck, that might be intentional. Sometimes drastically changing the look of a vehicle can be polarizing. One Cybertruck driver previously told BI he's owned all Tesla models but only faced negative reactions on the road with his Cybertruck. The YouTuber was even told by a sponsor that he couldn't feature his truck in a video because of its polarizing nature.

The refreshed model will still generate conversation about Tesla's most popular vehicle, which is one of the world's best-selling cars. The new Model Y could stick out more on the road and help car buyers broadcast they're in the latest Tesla, which may help boost sales or convince existing Model Y owners to upgrade their vehicles.

It's similar to Apple's approach with the iPhone, where the company has stuck with enhancing the model rather than building a new phone product line. Similar to Apple, Tesla offers frequent over-the-air software updates. When it comes to hardware updates, though, Tesla often offers a revamped design and enhanced features rather than creating an entirely new vehicle.

The new model announcement comes after the company reported its first year-over-year decline. The car giant said on January 2 that it sold around 1.79 million cars in 2024, slightly under 2023's 1.8 million. While Tesla's 2024 fourth-quarter deliveries increased by over 11,000 from the year prior, it still fell short of analyst expectations by about 14,430.

It's been a challenging time for the EV industry overall, which has slowed in the last couple of years due to factors including limited charging infrastructure and a lack of affordable options. President-elect Donald Trump's upcoming inauguration adds further uncertainty to the landscape, as he has vowed to eliminate EV tax credits.

The Model Y refresh in China comes at a pivotal moment for Tesla, as the EV giant faces increasing pressure from competitors like BYD. BYD has recently experienced surging demand, and is challenging Tesla's dominance in the country.

While the new model hasn't launched yet in the US, it's giving investors something to look forward to in 2025, in addition to a new lineup of cheaper EVs.

• Tesla has launched a refreshed Model Y in China as it fights off fierce competition from local rivals.
• The new Model Y is also available to order in Australia and parts of Asia, but there's no sign of a US release yet.
• Tesla is under pressure, with annual sales falling even as Chinese competitors like BYD report booming demand.

Tesla has launched an updated version of its most successful car — but you can't order it in the US yet.

Elon Musk's automaker unveiled a long-rumored refresh of the Model Y on Friday, with deliveries set to begin in China in March as the company fights off fierce competition from local EV rivals.

The new Model Y will have a longer range than its predecessor and an updated design that includes a Cybertruck-style light bar, according to Tesla's Chinese website.

The updated EV is available to order in China, parts of southeast Asia, Australia, and New Zealand. It's unclear when it will come to the US or Europe.

In China, it will cost 263,500 yuan ($35,900), around $3,000 more expensive than the starting price of the existing model.

The new Model Y's first appearance in China is no surprise, as Tesla is locked in a brutal price war with local EV companies in the world's largest auto market.

BYD, Nio, and Zeekr all reported big increases in annual electric vehicle sales earlier this month, with Tesla nemesis BYD announcing it had sold 1.76 million EVs in 2024 on the back of strong demand for its affordable models.

Tesla still leads the way, selling 1.79 million vehicles last year, but the carmaker reported its first decline in annual sales in 2024, and is under pressure to meet Elon Musk's ambitious target of 20-30% sales growth this year.

Tesla will hope a refreshed Model Y will help it hit that lofty target and refresh an increasingly stale product lineup.

The last new vehicle released by the company in 2023 was the Cybertruck, which isn't sold in China and has failed to significantly boost Tesla's sales figures.

Some workers on the Cybertruck line in the US have been moved to Model Y production, employees at Tesla's Austin factory told Business Insider.

The automaker has said it will release new, affordable EV models in the first half of this year but is yet to share any details, with Musk focusing instead on the steering wheel-less Cybercab he unveiled in October.

Tesla did not immediately respond to a request for comment from Business Insider.

• Hybrids ruled the roost in 2024.
• Some of the most popular cars in 2024 also have the highest share of hybrid sales.
• Despite a tough year for EVs, the Tesla Model Y makes the top five.

Once thought to be a dying segment, hybrid electric-gas cars had their best year ever in 2024.

A shift in the green car buyer base from wealthy early adopters to more frugal, practical shoppers gave hybrids new life. This new swath of buyers was not ready to make the jump to a fully electric car, said Ivan Drury, an automotive analyst for the car-shopping website Edmunds.

"Hybrids this year became an extremely easy default decision for someone who doesn't want to go full electric but wants basically 70% or 80% of benefits," Drury said in an interview. "These cars come with almost none of the extra costs or hassle in the sense that disrupting your lifestyle."

The popularity of these models is reflected in the top 10 best sellers, according to data provided by Edmunds. The top three — Ford's F-150 pickup truck, Toyota's RAV4 SUV, and Honda's CR-V — all have hybrid options that did especially well this year.

For example, about half of all RAV4 and CR-V sales are hybrids, according to Edmunds. Meanwhile, Ford has lauded the success of the F-150 hybrid this year as these vehicles make up more of the Blue Oval's sales.

Vehicle affordability also greatly influenced the popularity of hybrids this year, with models like the Honda Civic gaining in popularity.

"Customers recognized that this is a proven technology that the most trusted car companies have already been making," Drury said. "It's a win-win for anyone wary of EVs and shut out by higher interest rates this year."

1. Ford F-150

The No. 1 spot is never a question. For the 47th consecutive year, the F-150 pickup truck is the top-selling car in America.

Ford has leaned heavily into hybrid demand this year, and the F-150 is no exception. Due to the popularity of the Pro-Power Onboard feature, which turns your hybrid into a mobile generator, the company has said that about 20% of buyers choose the hybrid version.

2. Toyota RAV4

Toyota has sold more than 430,000 RAV4s so far in 2024, about half of which are hybrids.

An early leader in hybrid technology, Toyota has been proven right this year in its bet on these partially electrified cars.

3. Honda CR-V

The Honda CR-V, which also has a highly popular hybrid option, moved up one spot this year, knocking Chevrolet's pickup truck out of the top three.

4. Chevrolet Silverado 1500

Chevrolet's profit-driving Silverado 1500 pickup truck is still a highly popular car, commanding 2.5% of the US market in 2024.

Chevrolet also released a fully electric version of the Silverado 1500 this year, but it does not currently sell a hybrid model. GM had previously planned to skip hybrid models in North America but reversed those plans earlier this year.

5. Tesla Model Y

Tesla's most popular car rounds out this year's top five, with an estimated 336,833 units sold so far this year.

Tesla had a tough year as the EV market faced upheaval, and price cuts alone weren't enough to stoke demand. The affordable Model Y bucks this trend, and Tesla investors are hopeful more affordable models will carry Elon Musk's automaker through the coming years.

6. Toyota Corolla

Much has been made of the dying sedan segment, but Toyota and Honda continue to find success with these reliable vehicles.

The Toyota Corolla still accounts for more than 2% of the entire US market, proving a continued interest in affordable models, Drury said.

7. Toyota Camry

Toyota's Camry went exclusively hybrid for the 2025 model year. It also comes in a hatchback body style, which helps bolster the nameplate's popularity.

8. Nissan Rogue

The Nissan Rogue is an outlier on the list as one of the only SUVs without a hybrid option.

Nissan, which has struggled with demand overall this year, is considering a tie-up with hybrid leader Honda.

9. Honda Civic

The Honda Civic jumped seven spots this year to eke its way into the top 10. The rise of this reliable sedan, with a starting price below $30,000, is a good example of car shoppers' shifting preferences in 2024, according to Drury.

10. Chevrolet Equinox

The Chevrolet Equinox also jumped a few spots this year to make its way into the top 10. Starting at $28,600, this Chevy crossover sold about 206,100 units this year to capture 1.4% of the US market.

Chevrolet recognizes the popularity of this nameplate, choosing it as one of the first to electrify in 2024.