1st Model 3 to be built Friday, sales start soon

NEW YORK » The first Tesla Model 3 electric car for the masses should come off the assembly line on Friday with the first deliveries in late July, the company’S CEO said.

CEO Elon Musk, in several Twitter messages early Monday, said the new car passed all government regulatory requirements for production to begin two weeks ahead of schedule. The company plans to hold a party to hand over the first 30 Model 3s to customers on July 28, Musk wrote in a tweet.

The Model 3 is to start around $35,000 and with a $7,500 federal electric car tax credit, could cost $27,500. Tesla says the fiveseat car will be able to go 215 miles on a single charge and will be sporty, accelerating from zero to 60 mph in under six seconds.

Musk tweeted that the company expects to produce 100 cars in August and more than 1,500 in September. “Looks like we can reach 20,000 Model 3 cars per month in December,” he wrote.

Tesla also said Monday that it delivered about 22,000 vehicles in the second quarter, bringing firsthalf deliveries to about 47,100.

That’s at the low end of the company’s prediction earlier this year of 47,000 to 50,000 Model S sedan and Model X SUV deliveries in the first half, as much as a 71 percent increase over a year ago.

While second-quarter deliveries rose 53 percent from a year ago, they still were about 12 percent below first-quarter deliveries. Tesla said in a statement that second-quarter production was hampered by a severe shortfall of battery packs. Production averaged 40 percent less than demand until early June, the company said.

Tesla said that as long as global economic conditions don’t worsen considerably, it is confident that secondhalf Model S and Model X deliveries are likely to exceed deliveries in the first half.

Musk’s tweets about the Model 3 appear to erase doubts that Tesla would be able to meet deadlines for mass producing the cars, which is key to the company making money. Previously it has faced delays in getting vehicles to market. The Palo Alto, California-based company aims to make 10,000 Model 3s per week in 2018.

Tesla hasn’t said how many people have put down $1,000 refundable deposits for the Model 3, but Musk has said people who put down a deposit now won’t get a car until the end of 2018, suggesting it could be close to 500,000.

Tesla’s last new vehicle, the Model X SUV, was delayed nearly 18 months. Musk said the Model 3 is much simpler to make, but 14-year-old Tesla has no experience producing and selling vehicles in high volumes. Tesla made just 84,000 cars last year. Bigger rivals like General Motors, Volkswagen and Toyota routinely sell around 10 million vehicles per year.

Even if the Model 3 is on time, servicing all those vehicles will still be a challenge. Model S and Model X owners are already worried about having to share Tesla’s company-owned charging stations with an influx of new cars. And while Tesla is promising to increase its network of stores and service centers by 30 percent this year, it began 2017 with just 250 service centers worldwide. That leaves many potential owners miles from a service center.