Tesla’s Model 3 to take on BMW 3 Series

TESLA Motors has officially confirmed that its forthcoming smaller, more affordable sub-Model S electric sedan will be called the Model 3, pitched directly at premium executive cars such as the BMW 3 Series.

Tesla co-founder, product architect and chief executive Elon Musk chose to break the news – and reveal that Ford instituted legal action to prevent the EV brand from using the ‘Model E’ nameplate – in an interview with British publication Auto Express.

The company subsequently confirmed on its official Twitter account that the report was accurate, but said the images accompanying the story were “mock-ups based on their own speculation”.

The Model 3 will be sold alongside the Model S and the forthcoming Model X crossover, which enters the market next year.

“We had Model S for sedan and X for crossover SUV, then a friend asked what we are going to call the third car,” Mr Musk said in the interview.

“So I said we had the Model S and X, we might as well have the E.

“We were going to call it Model E for a while and then Ford sued us saying it wanted to use the Model E – I thought this is crazy, Ford’s trying to kill ‘SEX’! So we’ll have to think of another name.

“The new model is going to be called Model 3 we’ll have three bars to represent it, and it’ll be S, 3, X.”

Mr Musk revealed few other details but said the Model 3 should start at around $US$35,000 ($A37,330), a price point made made possible by Tesla’s in-house lithium-ion battery production project – known as the ‘Gigafactory’ – that is on course to begin operations in 2017.

The company claims the Gigafactory will reduce the cost of battery production by up to 30 per cent, as well as improving quality, performance and supply.

The new facility will produce batteries for all Tesla models and, potentially, a variety of models for Mercedes-Benz, which has a 10 per cent stake in the company.

The Gigafactory’s opening should coincide with the market launch of the Model 3, which is expected to be unveiled in 2016.

Overseas reports indicate that the 3 will be built on an all-new platform rather than a shortened version of the one underpinning both the S and the X.

A key architect of the program will be former Aston Martin chief engineer Chris Porritt, who was hired by Mr Musk last year as Tesla’s vice-president of engineering.

Demand for the Model S is far outstripping supply, with Tesla on track to produce around 35,000 vehicles for global consumption this year.

Output from its Californian factory is currently around 700 vehicles a week, and by the end of 2014 it expects to have increased this to 1000 vehicles a week.

Mr Musk also recently revealed that Tesla was planning to build a separate production facility in China in the next three or four years to satisfy demand in the world’s biggest auto market. This is all good news for Australian supplier Futuris Automotive, which produces the seats for all Tesla vehicles, operating out of a facility it has built under the roof of Tesla’s Fremont factory in California.

Futuris chief executive Mark de Wit told GoAuto last year that the company was preparing to ramp up production in line with Tesla’s vehicle expansion, and was looking forward to the new models including the Model X and the Model E, as it was known then.