Tesla confirms Model 3 production to begin this July

Production of the Tesla Model 3 will start in July, the company has confirmed, but it is looking for a cash injection to help bring it to the market.

It had been thought that production of the mass-market electric car could be delayed until 2018, but Tesla CEO Elon Musk confirmed to investors in a conference call that it would produce more than 5000 Model 3s per week by the end of this year and 10,000 units per week by some point next year.

However, he is seeking to raise capital in order to reduce risk for investors.

"According to our financial plan, no capital needs to be raised for the Model 3, but we get very close to the edge," he said.

"We're considering a number of options but I think it probably makes sense to raise capital to reduce risk."

Musk indicated the electric saloon, which has an entry-level price of $35,000 (about Rs 22.10 lakh), may not be unveiled until this July, when limited production will begin. Full-scale production is slated to start in September.

Tesla said it aimed to deliver a combined total of 47,000 to 50,000 Model S and Model Xs in the first half of this year, but did not give a figure for Model 3 target sales.

It did, however, reaffirm its pledge to deliver 500,000 vehicles in 2018 and one million in 2020, when its £3.8 billion (Rs 24,004 crore) Gigafactory (pictured below) is expected to reach full capacity – a sharp rise from the 80,000 delivered in 2016.

Tesla also hasn't provided an update on the number of reservations taken for the Model 3, which is believed have sold out for the first year; advance reservations totaled 373,000.

While the American manufacturer has enough capital to meet the demands for the Model 3, Musk suggested it would still look for more investment, which would provide more cash for the planned Model Y compact SUV. Tesla is also plotting to broaden its electric range with a cargo van, a minibus and a pick-up truck in the future.

Meanwhile, Tesla's chief financial officer, Jason Wheeler, will leave the company in April to take a job in the public sector after a year with Tesla. His predecessor, Deepak Ahuja, will return to the role. Ahuja joined Tesla in 2010 after 15 years with Ford.

Also read:

Tesla and Panasonic begin battery cell production at the Gigafactory

Tesla's Gigafactory in numbers