First Tesla Mass Market Vehicle Becomes Available This Week

On Sunday, Tesla Motors CEO Elon Musk announced that the electric car maker’s first mass market vehicle the Model 3 would start rolling off the assembly line Friday, which is two weeks sooner than originally planned.

On Twitter Musk said that the production would increase rapidly with 100 of the Model 3s produced during August and 1,500 more during September.

The CEO added that he expected Tesla to have the capacity to produce as many as 20,000 a month starting in December.

The mass market Model 3 is a big test for Musk and the ambitious plans he has to turn the electric carmaker into a mass market producer of electric cars.

Until this point, the company has only produced luxury vehicles in small numbers and they have sold for $90,000 and more. During 2016, it manufactured 85,000 vehicles, while mainstream vehicle makers such as General Motors produced over 9 million vehicles during the same period.

However, the Model 3 is priced at close to $35,000 and Musk has envisioned the new vehicle reaching a wider range of clients and said he expects the Model 3 to push the output of Tesla to over 500,000 vehicles during 2018.

During June, Musk told Tesla shareholders that production of the Model 3 would begin during July at its assembly plant in California, although he did not say when the first cars would be available in large quantities.

Musk has said that Tesla is working to make its assembly plant further automated in its effort to raise its output of the Model 3.

He added during the shareholder meeting that Tesla was starting to think about more assembly plants.

Tesla has held discussions of late with officials in China about opening a factory close to Shanghai. China represented about 15% of the revenue for Tesla during 2016.

To prepare for the Model 3 becoming part of its lineup, the automaker built a huge $5 billion plant in Nevada that produces batteries for the cars.

Tesla also has bolstered its cash as earlier in 2017 it was able to raise over $1 billion through offerings of debt and stock. Tencent Holdings an internet giant based in China took 5% of the company.

The extra capital is needed by the company because it is posting losses in the majority of quarters. During the first quarter of 2017, Tesla posted a loss of $397 million in comparison to a $282 million loss for the same period one year earlier. Revenue however doubled to over $2.7 billion.

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