Don’t expect the very first Tesla Model 3s to cost $35,000


The mass-market Model 3 from Tesla is touted for its anticipated $35,000 sticker price before tax incentives, a far cry from the bigger and more luxurious Model S and X. But the very first cars off the line could be more expensive than that — and maybe a lot more, if the pricey initial roll-out of the X is any indication.

On Tesla’s fourth quarter earnings call this afternoon, Musk noted that the company has typically sold fancier versions of its models first, well above the base price, in part because it has to recoup costs:

“Our default plan as we’ve done in the past is that the initial sales are relatively highly optioned versions of the car, because we’ve got to pay back the investment of the tooling and everything, so it makes sense to have the higher optioned versions first. That’s what we did with the S and obviously again with the X.”

Granted, early pre-order customers are far more likely to want an upmarket version of a car anyway — but still, the dream of a $35,000 Tesla may not happen in 2017 at all, depending on how late in the year deliveries start and how quickly the company is able to deliver in volume.

Musk did say that the Model 3 is “quite a bit less complex to manufacture” than the S, which comes as no surprise considering the base price — half of the Model S’s base. Savings are also realized from the lighter weight of the 3 (20 percent, roughly) and “economies of scale” that Tesla has built over the years, including a new paint shop that the company says can handle 10,000 cars per week at full tilt.