Tesla Model 3 design prototype – reveal event – March 2016
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Three days ago, when Global Equities Research projected more than 300,000 reservations for the Tesla Model 3 electric car by the start of this week, that number seemed outlandish.
And yet, by the end of Saturday, the global total had reached 276,000, according to a tweet by Tesla CEO Elon Musk.
When the Model 3 was first unveiled in California on Thursday evening, the number of deposits that day alone had already crossed 100,000.
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With an additional day and a half, Saturday’s total of 276,000 has likely crossed the magic 300,000 mark by now unless the pace has suddenly slowed to a crawl.
And that clearly caught even Tesla off guard, with Musk tweeting that the company would have to rethink its production plans for the 215-mile, $35,000 electric car that won’t hit the roads for almost two years under a best-case scenario.
Musk promised one more report on reservation totals, this one to come exactly a week after the Thursday evening introduction.
The response over the weekend was predictable but nevertheless fascinating to watch.
Tesla fans and investors were ecstatic, proclaiming the Model 3 the breakthrough vehicle that electric cars had required to enter the mainstream market.
Some went as far as to suggest that the Tesla Model S of 2018 would be just as revolutionary as the first Ford Model T, introduced 110 years before in October 1908.
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The Model T became the world’s highest-volume production car over the next 19 years, selling more than 15 million copies—a record that stood until 1972, when it was passed by the Volkswagen Beetle.
Many hurdles remain before the Model 3 can definitively be spoken of in the same light as the “car that put the world on wheels,” however.
Tesla must complete the Model 3 design, test and validate the car, get it certified by dozens of different regulators around the world, and tool up its factories for production levels 10 times as high as its best to date.
Tesla Model 3 design prototype – reveal event – March 2016
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It must also bring its massive battery Gigafactory online not only to assemble battery packs from imported cells, as it does now, but to fabricate and produce the actual cells themselves in the highest-volume battery plant in the U.S.
And if the company is to meet its recently confirmed deadline of starting Model 3 production by the end of next year, it has to do all that in 18 months.
At is much noted by commentary, Tesla Motors has not yet met an announced deadline for starting production of any of its vehicles: not the Roadster, not the Model S, and not the Model X.
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Finally, many financial analysts suggest that Tesla will have to raise additional capital, especially if it believes it needs to boost its Model 3 production volume beyond what it expected to build before the surge of post-debut orders.
It customarily costs $200 million to $500 million to equip a high-volume production line, one capable of building 150,000 cars a year.
Tesla has plenty of extra plant space in the Fremont, California, facility it bought from Toyota in 2009. But it will still need to tool up for higher-volume production.
