Tesla plans to produce a 6-seat version of the Model Y in China starting in late 2025, having asked suppliers to prepare for double-digit growth in Model Y production at its Shanghai plant, according to Reuters.

Tesla (NASDAQ: TSLA) plans to start producing a 6-seat version of the Model Y in China from the end of 2025, Reuters said in a report today citing two people familiar with the matter, echoing a rumor from last week.

Tesla has asked suppliers to prepare for a double-digit increase in Model Y production at its Shanghai factory, said a person familiar with the matter who asked not to be named, according to the report.

It's unclear how Tesla will increase production at the plant, which is awaiting approval to expand on 70 hectares (172 acres) of former farmland, the report said.

Tesla's domestic and overseas Model 3 deliveries rose 6 percent year-on-year from January through June, boosted by an update introduced last year, the report noted.

As Reuters previously reported, Tesla is revamping the Model Y under a program called Juniper. A second person familiar with the matter said the model will have five seats and will launch in early 2025, rather than this year as initially planned.

The addition of a 6-seat model underscores the pressure from domestic rivals in China, while in the US Tesla is prioritizing self-driving technology and robotaxi development, Reuters noted.

Those rivals have already unveiled at least four Model Y competitors this year, including Nio's (NYSE: NIO) Onvo L60 and Zeekr's (NYSE: ZK) 7X.

Tesla sells the 7-seat Model Y in the US, but the cramped third-row seat will make it unpopular in China, Reuters said, citing a person familiar with the matter.

On August 29, Chinese media outlet National Business Daily, citing an unspecified report, said Tesla plans to launch a China-built 7-seat version of the Model Y in China and Europe in October.

Production of the model has already begun at Tesla's Shanghai Gigafactory, the report said.

An hour after National Business Daily's report was published, Shanghai Securities News cited a Tesla source as saying it was false that the Shanghai factory was already producing the 7-seat Model Y. The person did not comment on other parts of the National Business Daily report.

Another local media outlet, LatePost, later in the day reported that Tesla plans to launch and deliver two updated versions of the Model Y next year, including a 5-seat version internally codenamed Juniper, which is expected to begin deliveries in the first quarter of next year.

The other is a 7-seat version of the Model Y, with deliveries expected to begin in the fourth quarter of 2025, according to LatePost.

When Tesla unveiled the Model Y in March 2019, it showed off its 7-seat flexibility. It wasn't until 2021 that Tesla began offering additional 7-seat options in the US market.

Currently only the four-wheel-drive, dual-motor Model Y Long Range supports the 7-seat version option in the US, which costs consumers an additional $2,000.

Tesla rumored to launch 7-seat Model Y in China and Europe in Oct