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(Reuters) -OpenAI said on Tuesday it has banned several ChatGPT accounts with suspected links to the Chinese government entities after the users asked for proposals to monitor social media conversations. In its latest public threat report, OpenAI said some individuals had asked its chatbot to outline social media "listening" tools and other monitoring concepts, violating the startup's national security policy. The San Francisco-based firm's report raises safety concerns over potential misuse of generative AI amid growing competition between the U.S. and China to shape the technology's development and rules. OpenAI said it also banned several Chinese‑language accounts that used ChatGPT to assist phishing and malware campaigns and asked the model to research additional automation that could be achieved through China's DeepSeek. The Chinese embassy in the U.S. did not immediately respond to a request for comment on the report. It also banned accounts tied to suspected Russian‑speaking criminal groups that used the chatbot to help develop certain malware, OpenAI said. The Microsoft-backed startup has disrupted and reported more than 40 networks since it began public threat reporting in February last year and its models refused overtly malicious prompts, the AI company added. "We found no evidence of new tactics or that our models provided threat actors with novel offensive capabilities," the company said in the report. OpenAI, which now has more than 800 million weekly ChatGPT users, became the world's most valuable startup at a $500 billion valuation after completing a secondary share sale last week. (Reporting by Jaspreet Singh in Bengaluru; Editing by Leroy Leo)

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By David Shepardson WASHINGTON (Reuters) -Air traffic control staffing issues are delaying flights for a second straight day at numerous U.S. airports as the government shutdown reaches its seventh day, the Federal Aviation Administration said in a notice on Tuesday. The FAA said many flights were being delayed at Nashville and Newark airports, among others. Arriving flights were being held for up to 30 minutes at Newark due to the staffing issues. Nashville air traffic control is facing significant staffing issues and will curtail operations later on Tuesday, the FAA said. Approach control will be taken over later by Memphis Center, it added. The FAA is reducing the number of arriving flights per hour at Chicago O'Hare, citing staffing, with average delays of 41 minutes. The FAA also reported staffing issues at Atlanta Air Route Traffic Control Center. Severe weather is also impacting flights across the country. Some 13,000 air traffic controllers and about 50,000 Transportation Security Administration officers must still turn up for work during the government shutdown, but they are not being paid. Controllers are set to receive a partial paycheck on October 14 for work performed before the shutdown. Transportation Secretary Sean Duffy said on Monday the FAA had seen a slight increase in controllers taking sick leave and air traffic staffing has been cut by 50% in some areas since the shutdown started last week. "If we don't have controllers, we're going to make sure the airspace is safe. So what we do is we'll slow traffic," Duffy said on Tuesday on Fox News' "Fox and Friends." FlightAware, a flight tracking website, said more than 2,500 flights had been delayed on Tuesday, including about 200 at Nashville, or 20% of its flights, and nearly 500 flights at Chicago O'Hare, or more than 15% of flights. In 2019, during a 35-day shutdown, the number of absences by controllers and TSA officers rose as workers missed paychecks, extending checkpoint wait times at some airports. Authorities were forced to slow air traffic in New York, which put pressure on lawmakers to quickly end the standoff. (Reporting by David Shepardson; Editing by Chris Sanders and Jamie Freed)

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By Abhirup Roy and Harshita Mary Varghese (Reuters) -Tesla rolled out "affordable" versions of its best-selling Model Y SUV and its Model 3 sedan, but the starting prices of $39,990 and $36,990 struck some as too high to attract a new class of buyers to the electric vehicle brand.  Tesla's stock fell 4% and Tesla bull Dan Ives, an analyst at Wedbush, said he was disappointed that the cars were only about $5,000 cheaper than the next trims of the models. The new versions, called Standard, cost more than what the previous models started at, including a $7,500 tax credit that expired at the end of September. The much-awaited unveiling is crucial for Tesla as it pushes to reverse falling sales and waning market share amid rising competition in Europe and China, and the loss of the U.S. tax credit. CEO Elon Musk has for years promised mass-market vehicles, though last year he canceled plans for an all-new $25,000 EV, Reuters first reported. Instead, he chose to build lower-priced versions based on Tesla's current models, sparking concerns among investors and analysts that the cheaper cars would cannibalize sales of existing vehicles and limit growth. "It's basically a pricing lever and not much of a product catalyst," said Shay Boloor, chief market strategist at research firm Futurum Equities. "I don't see it as unlocking new demand at scale." Both Standard versions offer 321 miles (516 km) of range and less powerful acceleration than the current higher trims called Premium. They can be ordered immediately, with deliveries set to start between December 2025 and January 2026 for many locations, Tesla's website showed. The Standard versions do not come with Autosteer, Tesla's driver assistance system, or touchscreens for rear passengers. Tesla has also removed the LED lightbar in the cheaper Model Y. Both come with textile seats, with vegan leather available for the Model 3, and manually adjusted side-view mirrors. Late last year, Musk said the vehicle would be priced below the "key threshold" of $30,000 including U.S. EV tax credits. In the United States, prices effectively rose by $7,500 at the end of last month, when the credit ended. Quarterly sales rose to a record as consumers rushed to take advantage of the credit while they could, but expectations are that they will slow down for the rest of the year, unless the affordable car comes to the rescue. "The desire to buy the car is very high. (It's) just (that) people don't have enough money in the bank account to buy it," Musk said in July during Tesla's second-quarter earnings call. "So the more affordable we can make the car, the better." Tesla had posted two clips on X over the weekend, igniting excitement among fans. One video shows headlights peering out of the dark and another shows what looks like a wheel spinning for a few seconds, followed by "10/7" — the U.S. format for the date October 7. CRUCIAL TO $1 TRILLION PAY PLAN Musk initially promised that production of the vehicle would start by the end of June. But Tesla only made what it called "first builds" of the car, it said in July, adding that it would be available for customers sometime in the last three months of the year. Tesla has already been grappling with slowing sales of its aging lineup as competition has grown rapidly, especially in China and Europe, where Musk's far-right political views have also undermined brand loyalty. Earlier this year, Tesla launched a refreshed version of the Model Y with improvements including new light bars and a rear touchscreen. Musk has been pivoting the company toward artificial intelligence, focusing on robotaxis and humanoid robots. Tesla has said it will launch more affordable vehicles in its lineup but has not provided details.  Affordable cars will also be key to Tesla delivering 20 million vehicles over the next decade – one of the several operational and valuation milestones set by the company's board as part of its proposed $1 trillion pay package for Musk. (Reporting by Abhirup Roy in San Francisco and Akash Sriram and Harshita Mary Varghese in Bengaluru; Editing by Peter Henderson, Richard Chang, Sriraj Kalluvila and Alan Barona)

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By Scott DiSavino (Reuters) -U.S. power consumption will hit record highs in 2025 and 2026, the Energy Information Administration said in its short-term energy outlook on Tuesday. The EIA projected power demand will rise to 4,191 billion kilowatt-hours in 2025 and 4,305 billion kWh in 2026, up from a record 4,097 billion kWh in 2024. Those demand increases come in part from data centers dedicated to artificial intelligence and cryptocurrency and as homes and businesses use more electricity and less fossil fuel for heat and transportation. The EIA forecast power sales in 2025 will rise to 1,508 billion kWh for residential consumers, 1,487 billion kWh for commercial customers, and 1,053 billion kWh for industrial customers. Those forecasts compare to all-time highs of 1,509 billion kWh for residential consumers in 2022, 1,434 billion kWh in 2024 for commercial customers, and 1,064 billion kWh for industrial customers in 2000. The EIA said the share of power generation for natural gas would slide from 42% in 2024 to 40% in 2025 and 2026. Coal's share will rise from 16% in 2024 to 17% in 2025 before sliding back to 16% in 2026 as renewable output rises. The percentage of renewable generation will rise from 23% in 2024 to 24% in 2025 and 26% in 2026, while nuclear power's share will slide from 19% in 2024 to 18% in 2025 and 2026, according to the outlook. The EIA projected gas sales in 2025 would rise to 13 billion cubic feet per day for residential consumers, 9.8 bcfd for commercial customers, and 23.5 bcfd for industrial customers, but fall to 36 bcfd for power generation. That compares with all-time highs of 14.3 bcfd in 1996 for residential consumers, 9.6 bcfd in 2019 for commercial customers, 23.8 bcfd in 1973 for industrial customers, and 36.9 bcfd in 2024 for power generation. (Reporting by Scott DiSavinoEditing by Rod Nickel)

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By Isla Binnie and Niket Nishant NEW YORK (Reuters) -Carlyle Group released its own measure of U.S. economic data on Tuesday, including a sharply lower estimate for September jobs growth despite rising economic output, to a market left wanting official releases because of the government shutdown.  The global investment firm estimated that U.S. employers added just 17,000 jobs last month, far below the 54,000 expected in the nonfarm payrolls report, which had been scheduled for release last week. The firm's internal indicators showed GDP growth running at a 2.7% annualized pace in September, a 3.8% drop in energy prices, and a 3.3% increase in prices for services, excluding shelter. 'DISCONNECT' BETWEEN EMPLOYMENT, ECONOMY "If you look solely at implied payroll employment growth, you'd think this was an economy on the cusp of recession or that has already fallen into recession," Jason Thomas, head of global research and investment strategy at Carlyle, told Reuters. "We have seen a big rebound in household consumption and ongoing business spending fueled by the AI boom. It's a really interesting time to see the disconnect between employment and broader measures of economic health." With official statistics delayed, investors are increasingly turning to alternative sources for real-time insights, and data-rich firms are positioning themselves as stopgap providers of economic intelligence. The U.S. government shutdown has entered its seventh day and is showing little sign of resolution. Private data providers are seeing a sharp uptick in demand. Research website Bigdata.com saw a 175% surge in usage after the shutdown, its founder, Armando Gonzalez, said in an interview. "When the official data channels go dark, investors are going to continue going for alternatives," Gonzalez said. Carlyle drew the data from its portfolio of 277 companies, which employ just under 730,000 people, and 694 real estate investments. Thomas said the boom in spending on artificial intelligence was also out of step with the rest of the economy. "All the oxygen is being sucked by AI," Thomas said, pointing to booming demand for X-rays and other key semiconductor components. This growth is "uncorrelated," he added. "It reflects the secular technological shock." Other private data released in recent days also point to weak hiring. Job search firm Challenger, Gray & Christmas said last week planned hiring in September hit its lowest since 2009, when the industry was reeling from the financial crisis. (Reporting by Niket Nishant in Bengaluru; Editing by Shilpi Majumdar and Rod Nickel)

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(Fixes typographical errors in paragraphs 1, 8) By Mike Stone WASHINGTON (Reuters) -After months of delay, the Pentagon will select as soon as this week the defense company to design and build the Navy's next stealth fighter, a U.S. official and two people familiar with the decision said, in what will be a multibillion-dollar effort for a jet seen as central to U.S. efforts to counter China. Boeing Co and Northrop Grumman Corp are competing to be chosen to produce the aircraft, dubbed the F/A-XX. The new carrier-based jet will replace the Navy's F/A-18E/F Super Hornet fleet, which has been in service since the 1990s. The decision to move ahead with a selection was made by Defense Secretary Pete Hegseth on Friday, the U.S. official and one of the people said.  The U.S. Navy could announce the winner of the competition to build its fighter as soon as this week, one of the people said. But last-minute snags have delayed progress on the Navy jet in the past and could do so again, sources said. The Navy and the Pentagon did not respond to several requests for comment. Holdups on F/A-XX highlight broader questions about the future of naval aviation and the role of aircraft carriers in confronting China. Delaying the program or starving it of funds could leave the Navy without a modern fighter capable of operating from carriers in the 2030s and beyond, potentially undermining the fleet's ability to project power.  The F/A-XX is expected to feature advanced stealth capabilities, improved range and endurance, and the ability to integrate with both uncrewed combat aircraft and the Navy's carrier-based air defense systems. China has been "incredibly ambitious in prototyping 6th generation aircraft and fielding 5th generation fighters and bombers, so this award could be viewed as an important decision to keep pace," said Roman Schweizer, an analyst at TD Cowen. DELAY A funding dispute in the spring and summer between the Pentagon and Congress delayed the program's advancement. The Pentagon sought $74 million for the jet to keep it on "minimal development funding." Some Pentagon officials had sought to delay the program by up to three years, citing concerns about engineering and supply chain capacity, Reuters reported in May. Congress and the Navy had wished to move forward with awarding a contract. Congress put $750 million to speed the F/A-XX jet into the massive tax-cut and spending bill which was signed into law this summer. Additionally, Congress earmarked an additional $1.4 billion for F/A-XX in fiscal 2026. Beyond the funding dispute, there was also debate during the months-long delay about whether defense contractors Northrop and Boeing would struggle to make the jet on schedule. Defense officials debated whether Boeing could employ enough engineers for the project after it was awarded a contract to build the U.S. Air Force's F-47 jet in March, sources said. They also debated whether Northrop would strain under the ballooning costs of the Sentinel intercontinental ballistic missile program, aimed at replacing the aging Minuteman III missiles, the sources said. The quantity of F/A-XX jets, the value and exact timelines of the program remain classified, but previous such contracts – such as that for the F-35 – have been worth tens of billions of dollars over their lifetime. The U.S. Navy still plans to buy more than 270 Lockheed Martin Corp F-35C jets for its carrier fleet. Earlier this year, Lockheed Martin was ejected from the F/A-XX competition.  The first production jets are expected to enter service in the 2030s, while F/A-18s are expected to remain in service into the 2040s. (Reporting by Mike Stone in Washington; Editing by Chris Sanders and Lincoln Feast.)

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By Jamie McGeever ORLANDO, Florida (Reuters) -TRADING DAY Making sense of the forces driving global markets By Jamie McGeever, Markets Columnist  A burst of profit-taking and economic jitters knocked U.S. and world stocks off their record-high perches on Tuesday as investors digested the ongoing political gridlock in the U.S. and France, while gold futures reached the landmark $4,000 an ounce level. More on that below. In my column today I look at the asymmetric risks in the Fed's easy policy stance. Chair Jerome Powell says rate cuts are needed to support the creaking labor market, but that may be questionable. What's less debatable is the whoosh they are giving to already booming asset prices. If you have more time to read, here are a few articles I recommend to help you make sense of what happened in markets today. Today's Key Market Moves Today's Talking Points: * U.S. bank reserves below $3 trillion U.S. bank reserves held at the Fed are below $3 trillion for the first time since January – down nearly $300 billion since late August – a clear sign that excess liquidity is being drained from the system. There's nothing magical about the $3 trillion figure, and it is probably well above the unknowable level where officials reckon reserves are still "ample". But it brings into focus Fed QT and the question of how low can reserves go without sparking liquidity concerns. Fed Governor Christopher Waller has said $2.7 trillion might hypothetically be an ideal level. It's not far away. * Bond blues Sovereign debt markets around the world are under heavy pressure, particularly the long end of the curve, where yields have recently shot up to historic highs in many countries. And in the case of Japan, record highs. There was some respite for U.S. Treasuries on Tuesday, but the backdrop remains challenging. Policymakers are running economies hot with monetary and fiscal easing, just as financial markets are booming and inflation is above target. Right now, investors are more inclined to sell any rip than buy any dip. * Nothing's gonna touch you in these golden years Gold futures reached $4,000 an ounce on Tuesday, and the spot market price got to within $10 of that landmark level. Bullion has climbed 20% in just six weeks, and is up more than 50% this year. The rally must run out of steam soon, right? Perhaps. But as talk of 'debasement' trades continues to percolate, and central banks continue buying, it's not clear what that catalyst is or when it appears. Easy Fed risks pouring fuel on 'everything' rally The Federal Reserve says its interest rate cuts are aimed at softening the impact of a looming labor market rupture. Unfortunately, cheaper money is unlikely to achieve that goal, but what it almost certainly will do is fuel the "everything" rally in financial assets. The reasoning posited by Chair Jerome Powell and the bevy of doves on the Federal Open Market Committee for pre-emptive easing is sound enough. Job growth is evaporating, which risks triggering a spiral of surging unemployment, lower consumption, and slower growth or even recession. The problem is the Fed's go-to tool in its armory – the federal funds policy rate – is a blunt one. This has always been true, but the risks in using it now are particularly asymmetric and increasingly skewed towards unwanted outcomes.  This is partly down to the imbalances that have taken root across corporate, economic and financial America. Consumption is driven by the richest households, who own most of a booming Wall Street, where profits, investment and market cap are dominated by a handful or two of megacompanies.  The Fed is easing monetary policy with U.S. financial conditions the loosest in over three years, credit spreads the tightest since 1998, inflation a percentage point above target, and GDP growth running at an annualized rate of around 3% or higher.  In financial markets, the "everything" rally is in full flow – Wall Street's big three indices, the Russell 2000 small-cap index, the tech sector, semiconductor stocks, gold, and bitcoin are all at record highs.  Powell did say late last month that equity prices were "fairly highly valued", perhaps echoing former Fed Chair Alan Greenspan's 1996 speech highlighting "irrational exuberance" in markets at that time. It's worth remembering, however, that the S&P 500 subsequently doubled and the Nasdaq quadrupled in value before peaking in March 2000.  There's no suggestion a similar boom – or bust – is on the cards. But because the wealth effect seems so prevalent, perhaps the Fed should be factoring financial market conditions into their decision-making more than they have in the past. IT'S A 'LOW-HIRE, LOW-FIRE' LABOR MARKET  Yet that doesn't appear to be the case. The Fed has shifted its focus towards the employment side of its dual mandate, but it's not clear how fragile the labor market really is.  Much of the recent spike in jobless claims can be traced to one-off weather events in certain states and, more importantly, one of the main reasons job growth has slowed is the Trump administration's immigration and deportation policies.  Even though policymakers' concerns may be justified, labor dynamics today are different from years gone by. It is a "low-hire, low-fire" job market – job growth is clearly slowing, but labor supply is shrinking too.  The nonpartisan Congressional Budget Office last month revised down its January estimates of net immigration this year by 1.6 million, and lowered next year's forecast by almost 1 million.  This has helped slash the monthly breakeven rate of job growth needed to keep the unemployment rate steady to well below 50,000, according to St. Louis Fed estimates, from over 150,000 at the start of the year.  And it's worth remembering that the unemployment rate is still a historically low 4.3%. It's unclear whether rate cuts, even the additional 100 basis points  futures markets expect by the end of next year, will encourage businesses to hire more workers in this environment.   As economists at BlackRock point out, that degree of easing is typically associated with a much starker weakening of the labor market, inflation, and growth, none of which looks certain or even likely at this juncture.  BlackRock economists' base case scenario is what appears to be playing out right now – resilient household incomes spurring a revival in consumer spending, and the wave of AI-related investment in tech equipment, software and data centers powering growth. Markets are reacting accordingly.  According to Chair Powell, the Fed's policy stance is "modestly restrictive", that is, close to neutral. On balance, further easing probably risks overheating Wall Street more than having a discernible positive effect on the labor market. What could move markets tomorrow? Want to receive Trading Day in your inbox every weekday morning? Sign up for my newsletter here.  Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias. (By Jamie McGeever;)

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By Suzanne McGee and Polina Devitt (Reuters) -Outsized flows into exchange-traded funds tracking gold have helped drive a spectacular rally that pushed bullion to record highs over the last month, analysts said. Spot gold prices hit another record of $3,990.85 per ounce on Tuesday, while  U.S. gold futures for December delivery edged above the $4,000 an ounce milestone. Some analysts cited the record pace at which investors are allocating money to the metal via ETFs.  Many investors have grown wary of sky-high stock market valuations and they view gold as a safe haven providing refuge from uncertain economic policy and geopolitics. Bullion prices are 51% higher this year, the largest surge since 1979, according to LSEG data.  "Institutional investor interest is just getting started," said Roukaya Ibrahim, commodities strategist at BCA Research, who calculated that assets in gold ETFs globally now account for 2.6%, up from 1.9% a year ago. The intensity of investor interest is unprecedented, said Ibrahim, adding that clients now keep her on the phone for as long as 90 minutes at a time to chat about market movements. State Street Investment Management said inflows into U.S. ETFs such as the firm's own SPDR Gold Shares have set all-time records of $35 billion as of the end of September, ahead of the previous full-year record of $29 billion, set in 2020. Globally, inflows into gold ETFs hit $64 billion year-to-date, according to data from the World Gold Council, with a record $17.3 billion in September alone.  That is a dramatic reversal from recent trends: over the last four years, gold ETFs have seen outflows totaling $23 billion, the World Gold Council calculated. Analysts said investors believe gold can hold its value in the face of economic policy headwinds and rising geopolitical tensions. They also hope gold can cushion big gains they may have seen this year as the artificial intelligence boom sent stocks soaring. "There’s a kind of 'barbelling' here, where gold becomes a hedge against any failure of the AI-driven tech boom to deliver on its promises and the policy implications of a crash," said Thierry Wizman, global FX and rates strategist at Macquarie Group. Gold, one of the world's oldest financial assets, is making its way higher in tandem with one of its newest, bitcoin, said David Schlesser, head of multi-asset solutions at VanEck. "Both are  decentralized store of value assets not tied to any government," said Schlesser.  Schlesser warns that "no asset goes up in a straight line and we should expect some tactical pullbacks and volatility," adding that in this case, "volatility is your friend," giving investors and traders a chance to jump in on dips. He expects gold prices to top $5,000 an ounce in 2026 and urges investors to allocate at least 5% of their portfolio to gold. Goldman Sachs said in a note published on Monday that it expects holdings of gold ETFs in North America and Europe to rise still further as the Federal Reserve cuts U.S. interest rates into 2026. Mike Wilson, chief investment officer at Morgan Stanley suggested last month that a 20% allocation to gold serves as a resilient inflation hedge.  "When you have establishment names like Morgan Stanley telling investors that they don't own enough gold, it's no surprise to see inflows jump, whether into ETFs or vaulted bullion,"  said Adrian Ash, head of research at online marketplace BullionVault. (Reporting by Suzanne McGee and Poline Devitt; Editing by Megan Davies and David Gregorio)

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By David Shepardson (Reuters) -Air traffic control staffing issues are impacting flights for a second straight day at numerous U.S. airports as the partial government shutdown reaches its seventh day, the Federal Aviation Administration said in a notice on Tuesday. The FAA said some flights were being delayed in Nashville and Newark airports, among others. Arriving flights were being held for up to 30 minutes at Newark due to the staffing issues. The FAA also reported staffing issues at Atlanta Air Route Traffic Control Center and said it could reduce the number of arriving flights per hour at Chicago O'Hare. Severe weather is also impacting flights across the country. Some 13,000 air traffic controllers and about 50,000 Transportation Security Administration officers must still turn up for work during the government shutdown, but they are not being paid and controllers are set to receive a partial paycheck on October 14. Transportation Secretary Sean Duffy said Monday the FAA had seen a slight increase in controllers taking sick leave and air traffic staffing has been cut by 50% in some areas since the shutdown started last week. "If we don't have controllers we're going to make sure the air space is safe. So what we do is we'll slow traffic," Duffy said Tuesday on Fox News' "Fox and Friends." FlightAware, a flight tracking site, said more than 2,300 flights had been delayed Tuesday, including about 200 at Nashville, or 20% of its flights. In 2019, during a 35-day shutdown, the number of absences by controllers and Transportation Security Administration officers rose as workers missed paychecks, extending checkpoint wait times at some airports. Authorities were forced to slow air traffic in New York, which put pressure on lawmakers to quickly end the standoff. (Reporting by David Shepardson; editing by Chris Sanders)

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By Abhirup Roy (Reuters) -Tesla unveiled more affordable versions of its best-selling Model Y SUV and its Model 3 sedan on Tuesday at $39,990 and $36,990, respectively, as the electric-vehicle maker seeks to reverse falling sales and waning market share amid rising competition. Tesla shares were down 4% shortly before the close. Both versions, called Standard, offer 321 miles (516 km) of range and less powerful acceleration than the current higher trims called Premium. They can be ordered immediately, with deliveries set to start between December 2025 and January 2026 for many locations, Tesla's website showed. The Standard versions do not come with Autosteer, Tesla's driver assistance system, or touchscreens for rear passengers. Tesla has also removed the LED lightbar in the cheaper Model Y. Both come with textile seats, with vegan leather available for the Model 3, and manually adjusted side-view mirrors. Chief Executive Elon Musk has for years promised mass-market vehicles, though last year he canceled plans to build an all-new $25,000 EV, Reuters first reported. Instead, he chose to build affordable versions based on Tesla's current models, sparking concerns among investors and analysts that the cheaper cars would cannibalize sales of existing vehicles and limit growth. "It's basically a pricing lever and not much of a product catalyst," said Shay Boloor, chief market strategist at research firm Futurum Equities. "I don't see it as unlocking new demand at scale." Late last year, Musk said the vehicle would be priced below the "key threshold" of $30,000 including U.S. EV tax credits. In the United States, prices effectively rose by $7,500 at the end of last month, when the credit ended. That helped goose quarterly sales to a record, but expectations are that they will slow down for the rest of the year, unless the affordable car comes to the rescue. "The desire to buy the car is very high. (It's) just (that) people don't have enough money in the bank account to buy it," Musk said in July during Tesla's second-quarter earnings call. "So the more affordable we can make the car, the better." Tesla had posted two clips on X over the weekend, igniting excitement among fans. One video shows headlights peering out of the dark and another shows what looks like a wheel spinning for a few seconds, followed by "10/7" — the U.S. format for the date October 7. CRUCIAL TO $1 TRILLION PAY PLAN Musk initially promised that production of the vehicle would start by the end of June. But Tesla only made what it called "first builds" of the car, it said in July, adding that it would be available for customers sometime in the last three months of the year. Tesla has already been grappling with slowing sales of its aging lineup as competition has grown rapidly, especially in China and Europe, where Musk's far-right political views have also undermined brand loyalty. Earlier this year, Tesla launched a refreshed version of the Model Y with improvements including new light bars and a rear touchscreen. Musk has been pivoting the company toward artificial intelligence, focusing on robotaxis and humanoid robots. Tesla has said it will launch more affordable vehicles in its lineup but has not provided details.  Sources have told Reuters the EV maker also plans to roll out a stripped-down version of its Model 3 midsize sedan. Affordable cars will also be key to Tesla delivering 20 million vehicles over the next decade – one of the several operational and valuation milestones set by the company's board as part of its proposed $1 trillion pay package for Musk. (Reporting by Abhirup Roy in San Francisco and Akash Sriram in Bengaluru; Editing by Peter Henderson, Richard Chang, Sriraj Kalluvila and Alan Barona)

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