Tesla stock has been resilient despite its relatively disappointing first-quarter results. One thing that helped boost shares was management’s promise to launch a lower-priced model—often referred to by speculators as the Model 2 or Model Q—in the first half of 2025.

Investors haven’t seen the new car yet. It might not be what they expect.

But they don’t seem worried. Shares of the electric vehicle maker were up 1.9% in early trading at $255.54, while the S&P 500 and Dow Jones Industrial Average were up 0.8% and 0.1%, respectively.

“Yes. We’re still planning to release models this year. As with all launches, we’re working through the last-minute issues that pop up,” said Lars Moravy, vice president of vehicle engineering in Tesla’s earnings call, adding that factory utilization is a primary goal of new products. “Flexibility of what we can do within the form factor and the design of it is really limited to what we can do in our existing lines rather than build new ones.”

Using existing lines rather than building new ones could prove problematic. New models for a car company typically require new design, new parts, and new tooling. They require significant investment. Offering a slightly different version of the Model 3 or Model Y might not be enough to boost sales—or enough for investors.

One reason investors want a new model is to expand Tesla’s addressable market. The Model 3 and Model S don’t cover all segments of the auto market—especially lower-end portions of it around the globe, which Chinese auto maker BYD serves successfully.

The average realized price for a Tesla vehicle in the first quarter was about $39,000. The average price for a BYD vehicle was closer to $20,000.

Cars that serve different portions of the market can expand a company’s market share while not cannibalizing an existing product lineup. A cheap Model Y just might end up dragging down vehicle mix without adding much to unit growth.

“Our view is the more affordable trims [of existing models] will cannibalize higher priced Model Y and Model 3 trims,” wrote Future Fund Active ETF co-founder Gary Black on social-media site X on Thursday. If cheaper 3s and Ys are the strategy then “earnings trajectories will resemble Tesla’s experience from 2023 to 2024, when 20% price cuts funded by cost reductions caused analysts to cut earnings estimates by 50%-plus.”

Tesla earned $3.12 a share in 2023. Wall Street estimates were north of $6 in late 2022.

Tesla didn’t respond to a request for comment about new models.

What Tesla does to its product lineup later this year is a key item for investors to watch. A new model that doesn’t address a new segment of the auto market would be a disappointment.

The severity of that disappointment will be weighed against another catalyst for Tesla stock: Robotaxis. Tesla still plans to launch a driverless taxi service starting in Austin, Texas, in June. Seeing driverless Teslas with paying passengers would be a boost to investor sentiment.

Stifel analyst Stephen Gengaro noted “lackluster” results in his post-earnings note but pointed out that the company is making progress on autonomous driving. “Near-term catalysts include CEO Elon Musk noting that his time allocation to DOGE will likely drop significantly starting in May, the ramp in sales from the new Model Y, lower-priced vehicles hitting the market, and the expected rollout of unsupervised [Full-Self Driving software] in Austin, TX in June.”

Gengaro is looking ahead. He rates shares Buy and trimmed his price target by $5 to $450 a share. The average analyst price target for Tesla stock is about $308, according to FactSet.