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Zarinegar's Zarinecars

Latest Blog Post

  • April 15th, 2016
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2018 Tesla Model 3

Model 3 combines real world range, performance, safety and spaciousness into a premium sedan that only Tesla can build. Our most affordable car yet, Model 3 achieves 215 miles of range per charge while starting at only $35,000 before incentives. Model 3 is designed to attain the highest safety ratings in every category.


As of March 2015, Tesla has not yet released any design renderings, or teaser images, of its third-generation “affordable” 200-mile car. Until an official unveiling of the Tesla Model 3, expected in 2016, the style of the car is pure guesswork. Even the name of the car is not entirely resolved. At the birth of the company, the project to create a lower cost mass-produced relative small car was called “Tesla Bluestar.” Elon Musk, the company’s chief executive, wanted to use “Model E,” for its name, but that conflicted with a Ford copyright. So Tesla shifted to “Model 3,” alternatively shown as the roman numeral for three, or three stacked horizontal bars.

We can look at the design vocabulary of the larger Model S sedan for the clues, but that should be counterbalanced with statements from Musk that suggest a significant departure not only from the Model S, but from the entire auto industry.

“I really want the Model 3 to be different, not just a smaller Model S,” said Musk. The Model 3 will be 20 percent smaller than the Model S.

Musk was speaking at the Automotive News World Congress in January 2015. Musk added that the car would be “way different from any other car on the road… [but] in a way that’s really useful and just doesn’t feel like a weird-mobile.” This is a veiled dig against electric cars like the BMW i3, which are iconoclastic but not entirely well received. The Model S has been universally praised as original, while derivative of premium vehicles from Aston Martin and Maserati.

Innovations aimed at usefulness in the upcoming Tesla Model X are reportedly the cause of multiple production delays for the all-electric sport utility vehicle. For example, according to multiple reports, the use of “falcon” doors (that rise up rather than swinging open) have proven difficult to implement. As a result, Tesla faces a formidable challenge of balancing “difference,” classic good looks, and a practicality and lower cost than the Model S.


There’s even less known about the performance of the Model 3. It’s assumed that the car, like the Roadster and Model S that preceded it, will offer quick bursts of acceleration. High power delivery is a signature trait of a Tesla automobile. Again, this will be a balancing act—considering that the bogey for driving range is 200 miles. Producers of electric cars commonly use multiple modes, such as sport and efficiency, to meet range targets in an efficient mode, while giving drivers on shorter trips theopportunity for a sportier drive in a performance mode.


The target for driving range in the Model 3 is 200 miles. The wild card is the use of battery packs of multiple sizes. Prior to the introduction of the Model S sedan, Tesla said it would offer a 40 kilowatt-hour pack with about 160 miles of range—in addition to the 60 and 85 kWh packs it now offers. The 40-kWh option was later jettisoned, because of lack of interest. Achieving a 200-mile range will require a pack, most likely, at about 50 kilowatt-hours. It’s not yet known if 200 miles will be based on the smallest pack, or if it will fit within somewhere else in a set of options.

The key is cost, and the actual cost of a finished installed EV pack—on a per-kilowatt-hour basis—remains difficult to pin down. Some analysts believe that Tesla is already approaching a cost of $200 per kWh, which would put the Model 3’s pack at around $10,000. Tesla’s long-term goal of about 10 years is to use mass production at its Nevada-based factory to bring the cost well below this level. The timing is tricky, and Tesla could have to either take a loss on the first set of Model 3 models, or modify its initial price target.

Yet, it’s important to note that Morgan Stanley analysts believe that the average transaction price—rather than the lowest base-level price—of the Model 3 will be closer to $60,000. In other words, Tesla could offer a 200-mile version of the car with minimal features, to make good on its cost-range promises, while selling the vast majority of Model 3 cars at higher price points (and profit margins).

The main point is that, after about seven years of EVs in the $30,000 range offering about 80 miles of driving range, Tesla will lead the vanguard of longer range battery electrics that offer more than twice the distance on a single charge at nearly the same price.


As of March 2015, there are more than 2,000 Tesla Superchargers crisscrossing the United States. The goal of this proprietary quick-charging network is to make road trips—even for a 200-mile EV—a feasible endeavor. A Tesla Model 3, with a nearly depleted 200-mile battery, will likely be charged to 80 percent, in about 30 minutes.

This will open up new possibilities for interstate travel for many EV drivers, although some mainstream Model 3 owners might feel a pinch of inconvenience as they drive out of their way to find a Supercharger to complete a trip.

What is undeniable is that regional travel in a 200-mile in a small stylish and affordable Tesla electric car—charged from home—will be void of even the slightest tinge of range anxiety.

A 240-volt Tesla “wall connector” home charging station costs $750, not including installation.

Passenger/Cargo Room

The Model S takes full advantage of the unique electric propulsion system to offer class-leading levels of passenger and cargo room. For example, there are trunks in both the back and front of the vehicle. We can expect the Model 3, in a 20-percent smaller form, to similarly maximize space in a small five-passenger car (about the size of a BMW 3-series).

In addition, Chris Porritt, Tesla vice-president of engineering, told the UK’s AutoExpress, that SUV and station wagon variants of the Model 3 could be in the works.


Independent testing by the National Highway Traffic Safety Administration (NHTSA) awarded the Tesla Model S a 5-star safety rating, not just overall, but in every subcategory without exception. Approximately one percent of all cars tested by the federal government achieve 5 stars across the board.

Any past concerns about the safety of Tesla vehicles, or electric cars in general, have been put to rest. Obviously, it’s way too early to consider the specific safety testing results of a vehicle that is years away from production.


Tesla’s Elon Musk continues to express a firm commitment to delivering the Model 3 with a purchase price of $35,000 before any incentives. Of course, only one of the Model 3 variants needs to be at this price for Tesla to make good on its goal. As a point of reference, the base MSPR for the Tesla Model S is $69,900—but the average transaction price, according to Morgan Stanley, is nearly $105,000. Adam Jonas, auto analyst with Morgan Stanley, believes the average transaction price of the Model 3 will be between $55,000 and $60,000.

Regardless, the availability of any 200-mile all-electric model for $35,000—which could equate to a net price as low as $25,000 after federal tax credits and a state rebate (in California)—would be a major accomplishment.

By the time the Model 3 goes on sale, there could be competing 200-mile EVs from General Motors, Nissan and others—as well as very broad range of plug-in hybrids and extended-range electric cars from some of the finest automobile manufacturers in the world. Any useful evaluation of pricing for the Tesla Model 3 must consider factors—such as competing models and option packages—that are unknown at this time.

Comparison with Similar Vehicles

The gas-powered cars most often cited as Model 3 competitors are the highly regarded BMW 3-series, which has a starting MSRP of about $33,000, and a Mercedes-Benz C-Class, with its base MSRP of $38,400. While Tesla is c interested in matching the Bimmer and Benz for performance, handling and comfort, those cars are internal combustion—and therefore are not really in the same category.

It’s also hard to imagine that potential 200-mile models from Chevy and Nissan—while powered by electrons—will have the same cachet (or innovative features and design pizzaz) as the Model 3. General Motors said it was also targeting the mid-$30,000 neighborhood for the Bolt, its long-range EV, but that’s after incentives—representing at least a $7,500 difference in cost on a base model. (Nissan hasn’t mentioned specific pricing for its potential longer range EV).

So, once again, we’ll have to wait and see not only what Tesla produces in 2017—but what an increasingly competitive field of EVs looks like at that time.

Purchase Process

As of March 2015, the Tesla Model X is basically sold out. New orders submitted in spring 2015 will be fulfilled in “early 2016.” So, considering the lower price point, the number of hand-raisers for the Model 3 could create a long backlog—a nice problem for Tesla to have.

Morgan Stanley’s current forecast is for 150,000 annual units of the Model 3 by 2020. Elon Musk’s stated goal is 500,000 by that time.

Either one of those targets will be the true litmus test of Tesla’s ability to achieve its vision for a mass-produced electric car. Analysts point to a long list of uncertainties about Elon Musk’s plan for auto industry domination—including sustained low gas prices, stubbornly high battery costs, stiff competition from other EV, and the whopper: the company’s ability, at any cost, to build the world’s biggest battery factory and to scale production of batteries on schedule, and at a price to provide enough batteries for the Model 3. Similarly, vehicle production has to be fast and flawless.

Tesla would have to defy all expectations to achieve success on the Model 3, while avoiding all the potential pitfalls—not only for the Model 3, but the battery factory, and the Model X that comes first. The smartest executives and analysts in the auto industry have bet against Tesla in the past, and lost. Here we go again?