Meanwhile, Musk and Thiel have been close for well over a decade. Musk grew up in Apartheid South Africa, the same country where Thiel went to school in the '70s. Thiel co-founded PayPal and served as its CEO, while Musk was chief product architect. Thiel was also an early investor in SpaceX and Tesla.

Mr Musk, without commenting further on the report, said in an X post: “Nothing @WSJ says should ever be thought of as true.”

“This variant of the Model Y doesn’t start production in the U.S. until the end of next year. Might not ever, given the advent of self-driving in America,” Musk said in a post to X on Wednesday.