It is a trade deal that will “rebalance, but enable trade on both sides,” said Ursula von der Leyen after the EU and US struck a trade deal in Scotland.

It was not the most emphatic declaration by the president of the European Commission.

The trading partnership between two of the biggest markets in the world is in significantly worse shape than it was before Donald Trump was elected, but this deal is better than nothing.

As part of the agreement, European exports to the US will be hit with a 15% tariff. That’s better than the 30% the bloc was threatened with but it is a world away from the type of open and free trade European leaders would like. The EU had offered tariff free trade to the US just weeks before the deal was announced.

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Instead, it has accepted a 15% tariff and agreed to ramp up its energy purchases from the US.

The EU tariff on US imports will remain close to zero but Europe did get some important exemptions – on aviation, critical raw materials, some chemicals and some medical equipment. That being said, the bloc did not achieve a breakthrough on steel, aluminium or copper, which are still facing a 50% tariff. It means the average tariff on EU exports to the US will now rise from 1.2 % last year to 17%.

There is also confusion over the status of pharmaceuticals – an important industry to Europe. Products like Ozempic, which is made in Denmark, have flooded into the US market in recent years and Donald Trump was threatening tariffs as high as 50% on the sector.

It appears that pharmaceuticals will fall under the 15% bracket, even though President Trump contradicted official announcements by suggesting a deal had not yet been made on the industry. The risk is that the implementation of the deal could be beset with differences of interpretation, as has been the case with the Japan deal that Trump struck last week.

It also risks fracturing solidarity between EU states, all of which have different strategic industries that rely on the US to differing degrees. Germany’s BDI federation of industrial groups said: “Even a 15% tariff rate will have immense negative effects on export-oriented German industry.”

The VCI chemical trade association said rates were still “too high”. For German carmakers, including Mercedes and BMW, there was some reprieve from the crippling 27.5% tariff imposed by Trump. The industry is Europe’s top exporter to the US but the German trade body, the VDA, warned that a 15% rate would “cost the German automotive industry billions annually”.

Meanwhile, François Bayrou, the French Prime Minister, described the agreement as a “dark day” for the union, “when an alliance of free peoples, gathered to affirm their values and defend their interests, resolves to submission.”

While the deal has divided the bloc, the greater certainty it delivers is not to be snubbed at.

Markets bounced on the news, even though the deal will ultimately harm economic growth.

Analysts at Oxford Economics said: “We don’t plan material changes to our eurozone baseline forecast of 1.1% GDP growth this year and 0.8% in 2026 in response to the EU-US trade deal.

“While the effective tariff rate will end up at around 15%, a few percentage points higher than in our baseline, lower uncertainty and no EU retaliation are partial offsets.”

However, economists at Capital Economics said the economic outlook had now deteriorated, with growth in the bloc likely to drop by 0.2%. Germany and Ireland could be the hardest hit.

While the US appears to be the obvious winner in this negotiation, uncertainty still hangs over the US economy.

Trump has not achieved his goal of “90 deals in 90 days” and, in the end, American consumers could still bear the cost through higher prices.

That of course depends on how businesses share the burden of those higher costs, with the latest data suggesting that inflation is yet to rip through the US economy. While Europe determined on Sunday that a bad deal is better than no deal, some fear that the worst is yet to come for the Americans.

The long-promised “more affordable” Tesla model has been spied on Chinese social media, and it’s disappointingly about what we expected: a slightly decontented version of the Model Y.

For many years, Tesla had planned to build a much more affordable vehicle, starting around $25k. This vehicle was nicknamed the “Model 2,” and would have offered the most affordable entry point into the EV market, at least in the West.

But that project was abruptly canceled by Tesla CEO Elon Musk as first reported by Reuters and immediately denied by Musk. Reuters was later shown to be correct in its report, as many who follow Tesla might have expected, given Musk’s constant overpromising (and often outright lies).

In its place, Tesla started offering vague promises about “more affordable models, starting in its Q1 report in April 2024. Tesla later specified that these would enter production in the first half of 2025.

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The language Tesla used suggested that the cheaper vehicles would be “new models,” which means more than one model, and not just based on a current Tesla model. But we reported that this was unlikely to be the case, and that the “new models” would just be a stripped-down Model Y.

That deadline came and went, but on Tesla’s Q2 call last week, it said that “first builds” were produced in June. On the same call, Musk said that the “new affordable model” is… the Model Y.

So, we’ve got confirmation that actual new models aren’t coming – but it does seem like something cheaper is coming down the pipe. And now, from Chinese social media pics of these “first builds,” we know just what kind of decontenting Tesla will do in order to get the cost savings.

Two videos were posted this weekend, on bilibili and weibo. The first was an exterior video by account “极客小猪” (machine translated as “Geek Piglet”). You’ll have to click through if you want to see the whole thing.

It shows the new Model Y as similar in size to the Juniper refreshed model it’s parked next to, though the front and rear are covered by camouflage and it’s hard to tell with perspective of the camera.

As best we can tell from the captions (which isn’t very well), the account seems to think this might be the upcoming larger Model Y L, and the camera perspective in the particular screeenshot above does make it look like the car in the forefront could be slightly longer than the one in the back. But other perspectives show them looking similar in length, and seeing the various missing parts later in the video, we think it’s likely the “more affordable” model.

There are a few holes in the camouflage that give som indication of what might be different, like that the rear light bar from the Juniper might be cut off rather than running across the whole rear of the car. The new one is also missing the “T E S L A” logo across the rear, as can be seen in a little window showing the rear camera.

The video gets a look at the interior of the vehicle, where the seats are covered up. I originally suspected the vehicle might have cloth seats, but the cover seems to have dropped down in the rear, and something leather-like is showing through, so Tesla may still be using its fake leather product to cover the seats.

It also shows that the center console is cut off between the armrest and the screen, using up less material and giving an open space there. This is somewhat similar to the original design of the Model S, which had a large space in front of the center console. We can’t tell from the video if the 2 phone charging mats are still present or not – it looks like the space they’d normally go is there, but the pattern looks different than the current NFC phone chargers.

For another look at the interior, we saw a couple more photos from another Chinese social media account, 42号车库, or “Garage No. 42” on Weibo. These show the steering wheel, front seats, rear and roof a little more clearly. It seems to be of the same car, given the status of the seat covers in the rear.

More changes become apparent here: there is no panoramic glass roof on the car, and the rear screen which was added in the Juniper refresh is once again eliminated. But the turn signal stalk, which was eliminated in the Model 3 Highland refresh and returned in a vestigial manner in the Juniper refresh, is (thankfully) still there.

The balance of these changes suggest that a lot of them are just rollbacks of the content which was added to the cars in the Juniper refresh. Interestingly, though, the Juniper refresh did not increase the price of the car significantly. So, rolling back those changes shouldn’t decrease the price of the car all that much either.

But these just show us some of the interior and exterior changes – the model might have other changes as well. From time to time, Tesla has offered cheaper versions of its vehicles either with rear-wheel drive only, to save on the cost of the front motor, or with a smaller or cheaper (e.g. LFP) battery. The new “affordable” Model Y might incorporate those changes too, and be able to get cost down more because of it, but we’ll have to wait for more information on that.

Further, there’s been no indication of a cheaper Model 3 or any actual “new models” yet. Model 3 is a smaller car than the Model Y, and thus could be cheaper – if Tesla is saving a significant amount of money by cutting a little plastic out of a center console, surely cutting hundreds of pounds of aluminum would save even more. We had expected the “more affordable models” to include both a stripped-down Model 3 and Model Y, but per Musk’s comments on the call, we might only be getting a Model Y.

Electrek’s Take

While it’s nice to see a potential lower base price, all of this is disappointing compared to the actual more affordable model that we could have had, the Model 2, which Musk unwisely canceled, instead putting his attention on becoming the largest funder of anti-EV, anti-environment and anti-American forces, and spending effort on spreading climate change disinformation and white supremacist nonsense rather than focusing on the mission of his company.

Maybe it would be nice to have someone in charge who takes the mission of sustainable transport seriously. Which Musk does not, and has in fact acted against with his recent actions.

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