By Karen Friar, MarketWatch
Tesla Inc. is set to begin production of its first Model 3 all-electric sedan on Friday, earlier than expected, according to the company’s chief executive, Elon Musk.
The vehicle has “passed all regulatory requirements for production two weeks ahead of schedule,” Musk said in a series of posts to Twitter late Sunday. In March, Tesla /zigman2/quotes/203558040/composite TSLA +10.78% said it was on track to begin making the first Model 3 cars in July and to deliver them to the first customers at the end of the year.
Once begun, the Model 3’s production rate should ramp up “exponentially,” with 100 sedans to come in August and more than 1,500 in September, he added. “Looks like we can reach 20,000 Model 3 cars per month in Dec,” Musk said.
The Model 3 — described previously by Musk as a smaller, more affordable version of the Model S — is expected to cost $35,000, compared with around $70,000 upwards for earlier Tesla electric cars. The rollout of the mass-market vehicle is key to Tesla’s goal of boosting total production to 500,000 by the end of 2018, from 84,000 in 2016.
Model 3: The Key to Tesla’s Future?
Electric-car maker Tesla delivered a mixed earnings report Wednesday that was strong on the revenue front and gave analysts confidence that the production of its highly anticipated Model 3 sedan is on schedule. WSJ's Lee Hawkins explains. Photo: Reuters
A party to mark the first Model 3 sedans for 30 customers will be held on July 28, Musk indicated. At least 400,000 people have put down a $1,000 deposit to reserve the all-electric car, according to a report by Electrek , though Tesla has not confirmed this.
That would mark a big step up for the Palo Alto, Calif.-based car maker, which delivered just over 25,000 vehicles in the first quarter of 2017 — beating analysts’ estimates and a comeback from a production target miss for the fourth quarter of 2016.
Tesla shares been on a tear over the past 12 months, up 67% compared with a 15% gain for the S&P 500 /zigman2/quotes/210599714/realtime SPX +1.05% . Its shares were up 2% at $368.88 in early trade Monday.