Why Tesla’s Model 3 is Drawing the Attention of Automakers

Tesla Model S Electric Car Zero Emissions

Elon Musk’s Tesla Motors, Inc. (TSLA) has changed the automotive industry. The company introduced its original model years ago, which lead to the addition of electric vehicles in several lineups of the world’s biggest carmakers, and the Tesla 3 may have a similar impact.

The vehicle, aimed at the everyday driver, pushes prices down to $35,000 and has spurred excitement that has never been seen in the auto industry outside of the Ford Model T.

Presales of the vehicle shattered analyst expectations. The automaker surpassed the 138,000 mark for pre-orders by the evening of March 31, the day the vehicle was opened for pre-orders. In retrospect, this is more than the company’s total sales for all vehicles sold by the company since it was founded: 107,000.

Elon Musk turned to Twitter (TWTR) to announce that the vehicle had surpassed 276,000 pre-orders by the end of the weekend. The sales have a value of $9.7 billion.

The Model-3 is set to begin shipping in mid-2017.

Average pre-order prices are estimated at $42,000, according to Musk, once all of the additional features have been added to the order. Production of nearly 300,000 vehicles will be difficult for the company as Musk announced that it will need to rethink production plans. Too many orders, especially with $1,000 down, isn’t a bad thing for Tesla.

Automakers have been reeling to find ways to drudge up similar excitement for their automobiles. The Nissan Leaf EV, from the Nissan Motor Co. Ltd. (NSANY) has been in production for 5 years and has sold just 200,000 vehicles.

General Motors Company (GM) is one company that will be attempting to mimic the success of Tesla. The company will be releasing the Chevrolet Bolt later in the year, and the Bolt has similar prices and features to the Model 3. BMW’s i3 offers a close match to the Model 3, but the i3 lacks in range, which has potential customers flocking to Tesla.

Perhaps the biggest fault of the automakers is that they don’t have a face for their brand like Musk brings to Tesla. Musk draws excitement and enthusiasm in the company’s products in a way that only Apple Inc.’s (AAPL) Steve Jobs brought to the world.

The following two tabs change content below.