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        home > news > Automobiles > First Look: Tesla Model 3 Battery Sedan

        First Look: Tesla Model 3 Battery Sedan

        Over 100,000 buyers already plugged in with advance orders.

        Paul A. Eisenstein
        Paul A. Eisenstein , Publisher & Editor-in-Chief
        April 01, 2016
        Tesla founder and CEO Elon Musk stands on stage with three of the maker's new Model 3 sedans.

        With a standing-room-only crowd cheering him on, Tesla Motors founder and CEO Elon Musk pulled the wraps off the long-awaited Model 3 sedan Thursday night, a vehicle intended to take the battery-carmaker into the automotive mainstream.

        A downsized version of the luxurious Model S, the Tesla Model 3 will go for about half the price, starting at $35,000, Musk said, for a vehicle that will deliver at least 215 miles range per charge, launch from 0 to 60 in under six seconds, comfortably fit five adults and surround them with a full range of safety features, as well as the semi-autonomous AutoPilot system.

        Plug In!

        More than 115,000 advance orders have already been placed, said Musk, noting plans call for the first of the sedans to be delivered “next year.” But in a nod to the fact that the recently launched Tesla Model X fell two years behind schedule, the South African-born executive added, “I feel fairly confident they will begin next year.”

        (Better late than never. Click Here for more on the Model X.)

        Tesla could use the new Model 3 as soon as possible. Musk thanked those in the audience who had already bought a Model S or Model X, noting they had helped fund development of the smaller sedan. Tesla has only occasionally crawled into the black since it was founded in 2003 – and only then using non-standard accounting procedures.

        Tesla has already began taking orders for the Model 3, with delivery planned for late 2017.

        Last year, the automaker sold just over 50,000 vehicles, slightly less than it had earlier forecast. It hopes to nudge production up to slightly less than 2,000 vehicles a week in 2016, but the Model 3 is designed to transform Tesla into a much larger company. In his prologue to the sedan’s unveiling, Musk noted that the Fremont plant had once rolled out as many as 500,000 vehicles a year when it was jointly operated by General Motors and Toyota. That is Tesla’s new target.

        Whether it can get there is far from certain, however. With a dedicated fan base, few analysts were surprised to see the initial burst of orders. The question is whether that demand will be sustainable. Total U.S. sales for all plug-based vehicles — including plug-in hybrids and pure battery-electric vehicles, or BEVs, like the Model 3 — dipped in 2015, to less than 100,000.

        But several features of the Model 3 could prove to be game-changers, starting with a price tag that rivals much less sophisticated battery-electric models now on the market, such as the Ford Focus EV, while offering far more range and features.

        "We don't build slow cars," said CEO Musk.

        The only vehicle set to come close will be the new Chevrolet Bolt. The Chevy electric, set to go on sale as much as a year ahead of the Model 3, will come in around $30,000 after federal tax credits of $7.500, and offer only slightly lower range, at 200 miles per charge.

        (Click Here for a closer look at the Chevrolet Bolt.)

        But Musk noted that the Tesla Model 3 will be offered with optional battery packs increasing the sedan’s range, much as is the case with the Model S. And the new Tesla will be larger and cut several seconds off its 0 to 60 launch compared to the Bolt. Again, as with the Model S, the new Tesla electric vehicle will be available with optional performance packages expected to make it significantly faster.

        “At Tesla, we don’t make slow cars,” Musk told his appreciative audience.

        Visually, the Model 3 retains a strong familial resemblance to the Model S, and the basic structure of the two vehicles is the same, with the battery pack built into the floor itself. That frees up space where an internal combustion engine would normally go, resulting in both a bigger passenger compartment and twin storage compartments, including a conventional trunk in the back and another up front.

        Virtual all controls appear to be operated through the Model 3's large touchscreen display.

        As for the interior, while appearing to be lavished in leather and chrome, the Model 3 sedans on stage revealed minimalist interiors with virtually no knobs or switches, all controls incorporated into a laptop computer-sized videoscreen in the center of the instrument panel. Unlike the vertically mounted display in the Model S, however, the Model 3 screen uses a more traditional, horizontal layout.

        Among the few other details revealed by Musk, the Model 3 was designed to achieve the maximum five-star safety ratings in all the categories tested by the National Highway Traffic Safety Administration. It will include a wide range of active safety technologies, and though Musk didn’t call out specifics, that is expected to include forward collision warning with emergency auto-braking, as well as AutoPilot, a semi-autonomous system capable of hands-free driving on well-marked, limited-access highways.

        Whether the Tesla Model 3 can deliver on its promise is a subject of intense debate. Efraim Levy, a widely followed analyst with S&P Global Market Intelligence, lowered his rating of Tesla to “Sell” a week ahead of the Model 3 debut, warning, “We see significant execution and valuation risk in the premium priced stock.” Following the debut, Levy noted the initial flood of orders “raises our confidence in the success…of the vehicle,” but he maintained his bearish position on Tesla stock.

        Like the Models S and X, Tesla will offer optional battery pack and performance upgrades.

        On the other hand, Jessica Caldwell, the industry analyst for tracking site Edmunds was decidedly upbeat, countering that, “If there’s ever been any evidence that Tesla is primed to make the leap to mainstream car buyers, this is it.”

        During his warm-up speech, Musk noted the strong reviews the Model S has gotten from sources such as Consumer Reports. But he notably ignored the fact that Consumer Reports subsequently trashed the big sedan for ongoing quality and reliability issues, revoking its coveted “Recommended Buy” rating. That so far hasn’t hurt sales of the Model S sedan.

        “There’s nothing particularly rational about Tesla,” said Rebecca Lindland, of Kelley Blue Book.  “But there’s something very emotional about the brand.  People believe in Elon Musk’s dream, in his belief that he and his brands can change the world.  People want to be part of that dream, and the Model 3 will allow more people to participate in his vision.”

        Chevrolet will actually get to market sooner with the 200-mile Bolt battery-electric vehicle.

        Those initial orders, which require only a $1,000 down-payment, still must translate into sales. And Tesla still needs to ensure there will be more buyers to follow.

        Model S and X buyers may be willing to put up with quality and reliability hassles – and a price tag that can top $130,000 — in order to share Musk’s dream, but with the Model 3, Tesla is now going to need to win over buyers who pay more attention to rational matters like price, features and quality. The sedan looks good on paper. But it remains to be seen if the mass market will plug in.

        (For more on the risks facing Tesla, Click Here.)

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        3 responses to “First Look: Tesla Model 3 Battery Sedan”

        1. Bob says:
          April 2, 2016 at 3:50 am

          And how much has our government loaned Telsa to be in the black .

          And what are non standard accounting practices?

          Reply
          1. Paul A. Eisenstein says:
            April 3, 2016 at 3:35 pm

            Tesla long ago paid back its initial loan.

            Non-standard practices are legal but not inline with GATT methodology. As a non-accountant, I’d get myself in trouble if I tried to explain further.

            Paul E.

            Reply
        2. Thomas Davy says:
          April 4, 2016 at 10:13 am

          “We don’t build slow cars,” said CEO Musk.
          -If by fast he means like a ’70s muscle car, I agree.
          -If he means fast on a twisty road or a track, he is far from correct.Laughable to me that Tesla sophists ignore the dismal handling of these machines. You’d think some would-be world beater could at least hang with a Mustang GT, or something like that which costs a fraction of Tesla money, on a road course.

          Reply

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