Following months of anticipation and investor confidence, Tesla plans to unveil its more affordable all-electric Model 3 vehicle today at its Los Angeles design studio at a starting price of $35,000 – before federal and state government incentives. Based on early reports, the Model 3 will more closely resemble the larger full-size Model S sedan than the full-size Model X crossover SUV.
Last year, only 2.1 percent of new cars purchased in the United States cost $75,000 or more, according to TrueCar, an automotive and pricing information website. On the other hand, nearly 35 percent (roughly 5.5 million) cost $35,000 or more. The vehicle is expected to become a much-needed market catalyst for its price segment, offering more range than competitors such as the BMW i3, Nissan Leaf and Chevy Volt, and will become available sometime in 2018.
Tesla CEO Elon Musk has been quoted as saying “200 miles should be the minimum range for any all-electric car,” so we can expect this to be the minimum (if not higher) range for baseline Model 3 specifications. Meanwhile, the Model S has a baseline range of 208 miles (60kWh battery) [now replaced by a baseline 70kWh battery with 230-mile range], and goes up to 300 miles (90kWh battery), while the Model X has a baseline range of 220 miles (70kWh battery) and goes up to 257 miles (90kWh battery).
On March 21, the company published a blog post detailing Model 3 reservation procedures. There are two ways to reserve the vehicle – the first is by visiting a local Tesla store today (March 31st) and placing a $1,000 deposit. The company claims this is actually the preferred way to get a better spot in the reservation queue. The second method is by making a reservation online today at 7:30pm PDT, one hour before the live unveiling begins at 8:30pm PDT in Hawthorne, California.
Regardless of reservation method, Tesla CEO Elon Musk says that reservations are limited to two (2) vehicles per person.
Tesla's production factory in Fremont, California (via Bloomberg.com)
Model 3 production is scheduled to begin in Q4 2017, more than a year and a half from now, and Tesla says that deliveries will begin in North America starting on the West Coast and moving east.
"I do remain confident about half a million cars in 2020, and maybe being able to exceed that," Musk said on a conference call with investors in August 2015. "That's five years from now. If you go five years in the past for Tesla, we were producing 600 cars per year—now we can produce 600 cars in three days. So I think going from here to 500,000 cars a year is a much smaller leap."
Image source: Bloomberg.com
A convenient graph from Bloomberg shows how Tesla’s sales currently stack up with Ford’s Model T success in the early 1900s. Ford surpassed 10,000 deliveries in 1909, while Tesla surpassed that same amount in 2013. Between the seven-year period from 1909 and 1916, Ford went on to produce 501,462 cars. Analysts claim that between 2013 and 2020, Tesla could be on track to hit the same production targets so long as market indicators remain stable and the lower-cost Model 3 doesn’t flop.
“We recognize that everyone wants to get their Model 3 as quickly as possible. Our overarching goal is to maximize total customer happiness within the bounds of what is physically possible.”
