On Friday afternoon, Tesla CEO Elon Musk took to Twitter to update the company’s pitch for the forthcoming Model 3… by tamping down expectations.
On Friday afternoon, Tesla $TSLA CEO Elon Musk took to Twitter $TWTR to update the company’s pitch for the forthcoming Model 3… by tamping down expectations.
The $35,000 electric vehicle has stirred up a frenzy of interest since Tesla announced it in 2014. More than 375,000 people forked over a $1,000 deposit to get on a waiting list for the car, due out in mid-2018. The Model 3 is expected to be among the highest-performing electric vehicles on the market, where it will be up against rivals that include the Nissan Leaf, the Chevy Bolt, the Renault Zoe, , Chinese ‘s e6, and ‘s iOniq.
Join 500,000+ readers who start their day with Quartz.
By subscribing, you agree to our Terms of Service and Privacy Policy.
Although the Model 3 follows the Model S and Model X, Musk wants to make sure people understand that it is not an advanced new iteration of Tesla model. Rather, the car is a simplified and less luxurious version of the $68,000 Model S.
In that sense, the Model 3 is more like the iPhone SE—a streamlined version of an original product, without all the bells and whistles. The Model 3 will pack a smaller battery, offer less range, and have about 20% less interior space than the Model S. It’s expected to have rear-wheel instead of all-wheel drive to simplify manufacturing. Tesla has also consolidated the instrument panel (no heads-up display) in anticipation of more autonomous driving, which does not require complex dashboards. More upgrades for the Model 3 are expected to come later.
The success of the Model 3 is crucial for Tesla, which needs a profitable, mass-market vehicle to staunch annual losses in the hundreds of millions of dollars. To date, Tesla has avoided splashy paid advertising campaigns—its car advertising budget came in at about $6 per vehicle in 2015—in favor of trotting out Musk himself for promotional efforts.
That has worked well so far: Tesla’s stock is up 225% since 2013. Musk has a reputation for being entertaining, and customers (or would-be customers) enjoy his quirky anecdotes about sleeping on the factory floor, his thoughts on the likelihood we’re all living in a simulation (very high), and his opinions on the probability of alien life (almost a certainty).
