Learn Finnish: Hän vastasi viestiin sähköpostitse. - He replied to the message by email.

Both mean "by email" and are correct, but the prolative form sähköpostitse sounds slightly more formal or official. You will see it frequently in business contexts, websites, or written instructions. In casual spoken Finnish, the adessive form sähköpostilla is much more common.

Why does sähköpostitse look like it's built on the singular word? I thought the prolative case uses the plural stem.

You are right that the -tse suffix is normally added to the plural stem, which is obvious in words like puhelimitse (from puhelin) or kirjeitse (from kirje). However, because sähköposti ends in an -i, its plural stem also ends in an -i before this ending, making it look as though it was built directly on the singular form.

Can I add -tse to other nouns, like saying autotse for "by car"?

No, the prolative case is quite restricted in modern Finnish and cannot be applied freely to just any noun. It is mostly used in established expressions for routes (maitse for "by land", meritse for "by sea") and means of communication (sähköpostitse, puhelimitse). For physical vehicles, you must stick to the adessive case: autolla (by car) or junalla (by train).

Why is it viestiin (illative) instead of viestille (allative) if he is replying "to" the message?