How Much Will Tesla Model 3 Really Cost? A Lot!

 

Believe it or not, the Tesla Model 3 is supposed to start production on July 1. Now, even Elon Musk knows that is a highly ambitious goal andnhas allowed for some slippage in that time table, but he still maintains the company will build 50,000 to 100,000 Model 3 sedans this year.

The Model 3 is the third phase of Musk’s Master Plan. After years of making super expensive luxury electric cars, the Model 3 is supposed to be an affordable alternative — the Tesla that ordinary people can actually buy. The base price of the car has been touted as $35,000 since Tesla first announced the Model 3 more than a year ago. The allure of the car is so strong, 380,000 people around the world have ponied up $1,000 to reserve one.

Any federal or state incentives will lower the cost even further. In theory, a buyer in California could pay as little as $22,500 for one after all incentives, including those from local communities, are figured in. But is that realistic?

Tesla Model 3 prices

No, according to Model 3 reservation holder and YouTuber Shots of Jameson. He claims that a fully loaded Model 3 could retail for more than $130,000 if all the options Tesla offers on the Model S are included and cost the same as they do for the larger car. That’s unlikely, he admits. But assuming Model 3 accessories are discounted 25%, the bottom line could still pencil out to a staggering $75,000 — more than double the base price.

Model 3 premium price

Shots of Jameson speculates that the base car will have base level appointments — no fancy alloy wheels or red painted brake calipers and no upmarket interior or exterior trim bits. He also thinks the heads up display most people expect in the Model 3 will not be included in the base car.

Most people will want upgraded wheels, premium interior appointments, and the very cool glass roof. They will also want a larger battery and dual motors. Expect that mid-level car to sell for as much as $50,000. At the top end, adding full Autopilot, sunroof, premium sound, and a few other luxury bits could push the price to $75,000 or more.

For those who want a basic car, the wait will be long. Tesla says right up front it will build cars with the highest profit value first. Tesla has already sold more than 100,000 cars in the US. The federal tax credit begins to ratchet down once the company has built more than 200,000 cars. By the time all the high content cars are built, the federal tax credit for Tesla cars will have disappeared, making the odds of getting a Model 3 for under $30,000 very slim indeed.

Will any of this matter to Tesla customers? Probably not. The Model 3 is the most anticipated new car in history. Tesla will likely sell every one it can put together, at least for the first year or so. But those who thought they would be able to score a Tesla as a bargain price are apt to be disappointed. The Model 3 will cost less than a Model S or Model X, but it will be far from an entry level car. It’s nearest competitor will be the BMW 3 Series, which also starts at around $35,000 but can be optioned up to $70,000 or more by ticking all the boxes on the order form.

Shots of Jameson has no insider knowledge about Tesla or the Model 3. He is just a fan who has made some realistic assumptions. When the Model 3 configurator goes live later this year, we’ll know for sure how accurate his prognostications are.






About the Author

I have been a car nut since the days when Rob Walker and Henry N. Manney, III graced the pages of Road & Track. Today, I use my trusty Miata for TSD rallies and occasional track days at Lime Rock and Watkins Glen. If it moves on wheels, I’m interested in it. Please follow me on Google + and Twitter.

  • Kieran Delaney

    An interesting piece, but nothing we didn’t expect. Making the same car go faster, for longer, and with better ‘stuffs’ in it…costs more (newer technology, R&D costs etc…).

    “…the bottom line could still pencil out to a staggering $75,000 — more than double the base price.” – No different from Mercedes/BMW/Audi/Jaguar/Cadillac etc.

    Besides, if I had the money for either, I’d rather a decked-out Model III than a base Model S. I’m a European, who spends half his year in Japan…compact is my friend!

    P.S.: I may not have put enough “etc”s in this block of text so here, enjoy a few more, etc, etc, etc…

  • bioburner

    Not surprised at all at how quickly the price of this car can run up. Look at the acceleration of the price on the “S” and “X” as you add on the options. A lot of people on other web sites were harping on Chevy because the base Bolt is a real stripper and that ordinary buyers will opt for the premier which is gonna cost say north $42K. That loaded Bolt sounds like a bargain when/if Tesla options the Model 3 like they did the Model S and X.
    Another interesting question is what is the lease price for Model 3. Chevy is talking in the range of $300 to $400 for the Bolt. Since most people lease this type of car that my very well be a very important factor.

  • IndyX

    Acording to Elon Tesla expects the average model 3 selling price to be 42 to 43k but 75k for the all wheel drive extended range performance version with stupidly large rims probably sounds about right to me…
    I know Tesla has been around for 10 plus years now but I still view them as a start up so them selling the high dollar versions first does not bother me even though it probably would if GM did that…

  • SfCoop

    Specious reasoning.

    I’m sure it’ll be up there, but its pretty tough to add more than 30K worth of options to most cars that start around 35K. I imagine Tesla has a tough line to walk here. On the one hand, I’m sure they make a mint on options. On the other, if they push too much, they end of pushing themselves out of the market. They also can’t run the risk of destroying model S sales — the real profit engine for the company.

    • Dan Paulson

      Profit engine…..lmao!!!

  • Kerry Carter

    If you can order like you really want?Base model:
    The largest battery.
    Dual motors (non performance = best range)
    Charging
    What I want, only what I need.

  • dogphlap dogphlap

    Musk has said he expected the average sale price to be $43,000 (that figure is from memory, it’s about right) but he also said the base car will be a good car at $35,000. Other than that we know very little. But wait, yes wait ten months or less and we will know.
    Some may have been trying to decide to buy a car now (a Bolt perhaps) or wait until the Model 3 is released, other than them just exercise some patience.

  • Mark Schaffer

    Speculative story with no actual factual basis. Rational people will wait for second reveal.

    • James Divine

      Rational people don’t put in $1,000 reservations on cars that won’t be made for 2 more years.. when the final design isn’t even available. We’re zealots here, brother.

      • Mark Schaffer

        A 100% refundable deposit to support a company that treats its employees well, develops cars that are clean and getting cleaner, addresses the reality of AGW and the other pollutants you and any family suffer with and from, puts thousands to work, drives innovation across the automotive manufacturing sector, and does so while sticking it to short sellers.
        Irrational people are against all these things. Are you in favor of the eight hundred years that humanity will suffer the consequences from burning fossil fuels? How about NOx, SOx, particulate, and aerosol pollution? Or the heavy metal and radionuclides from burning coal? You cool with that Jimmy?
        Rational people invest in a future that is better for everyone.

  • QKodiak

    The BMW 3-Series starts out at $33,450 for the 320i, a car with only ~200 hp (they say 180, but we know that’s underrated). The 272 hp Cadillac ATS starts at $34,595, and the Mercedes C-class starts at $39,500 for the 241 hp C300.

    A fully loaded Cadillac ATS-V costs $80,475. A fully loaded BMW M3 costs $96,472. A fully loaded Mercedes C63 AMG S costs $106,520. A fully loaded, long range, self-driving absurdly powerful version of the Tessa Model III will be price competitive with these vehicles, and this does not come as a shock to those who have bought higher end vehicles. The good stuff doesn’t come cheap, and Tesla is no exception.

    • Kieran Delaney

      Exactly.

      • t_

        Yes, I wanted to write the same. It is so common that the base level vehicle could be more than half the price of the fully loaded one. Nothing new. Expected.

    • Mac1177

      Spot on my man.

  • Raphael Sturm

    It is hard to say how much the options on the vehicle will amount to. Especially since batteries, as well as the motors, will be cheaper, so range upgrades, dual motor and performance upgrades could be cheaper.

    If I had to guess, they will try to match the Audi A4, BMW 3 series pricing, but probably add a couple of thousand bucks. So I do think the top of the line Model 3 could cost around $80k. The base BMW 3series has got a MSRP of $33,450, but a fully equipped M3 is $80,500.

    • Mark Schaffer

      “Guessing” is exactly all this article does.

      • Raphael Sturm

        Thats true, but guessing can be fun. And sometimes someone actually has a good guess that turns out to be true, just because it made so much sense.

        • Mark Schaffer

          The trouble comes when the stakes for humanity are so high. The air in China is killing people fast while our fossil fuel carbon emissions will be worse than that for death rates going forward. Ever notice how such “guessing” is generally negative for clean tech and Tesla? I don’t find anything “fun” about this given the underlying serious issues.

          • Raphael Sturm

            I don’t now what should be negative about this article. That the Model 3 won’t come fully specked for 35k isn’t a surprise and I doubt it will save the world by itself. If you want me to be honest, I do think overpraising might be worse, since people won’t buy an EV today, since they dream up their Model 3. For 35k you will get a nice car, but the one for 50k will be more desirable.

          • Mark Schaffer

            This you?
            “So I do think the top of the line Model 3 could cost around $80k. ”

            So what are the actual numbers? 50k or 80 or the 75k made up by the article?

            The proper answer is to wait for the actual numbers.

          • Raphael Sturm

            I said between 35k and 80k, which includes 50k, per definition. I think the 50k Model 3 will be the best value for money, I used desirable before, which isn’t really what I meant, but I think a 50k Model 3 will tick all the most important boxes, without being overly expensive, like a nicely equipped Model S 75D today.

          • fred smith the deplorable

            Your religion is false. Tesla is not the true church. Global warming/impending ice age/anthropogenic climate change is false doctrine. Yep, it is fun watching the loonies’ heads explode.

          • Carney3

            I realize it’s tempting to call global warming a “religion” after being pounded all the time with the reality that science affirms global warming. But it’s as ineffective as the Right calling the Left “racist” or when the Left calls the Right “un-Christian” or “unpatriotic”. Nobody takes it seriously.

            As a former denier myself, I think global warming denial comes from two sources: 1) tribal feeling of the “yay us boo you” variety; 2) policy concerns; in other words if we give the Left an inch in admitting it’s real, they’ll take a mile and ram through the most radical items in their wish list.

            But facts don’t care about our feelings, radical proposals cause more opposition than moderate ones, and in any case, we can and should claim this issue for ourselves.

            Put the Left on the spot by embracing nuclear power as the major affordable, reliable, large-scale source of zero-carbon electricity for First World countries.

            Put the Left on the spot by embracing higher octane, cleaner burning biofuels to replace gasoline and diesel instead of forcing ever more draconian mileage requirements that make cars slow, weak, small, and fragile.

          • luke7478

            Sorry, but the FACT is: the model 3 (or any zero emissions Tesla for that matter) is not “slow, weak, small or fragile”. Most Teslas weigh several hundred pounds (sometimes thousands) more than their gas counterparts making them much safer (once again those pesky laws of physics). The model 3 accelerates from 0 – 60 UNDER 6 seconds, and it accommodates 5 people easily with MORE luggage space (additional space under the hood) than its equivalent gas version …….so there you go!

          • Carney3

            I’m a big fan of Tesla for the same reason I’m a fan of ethanol. Both are about replacing gasoline while not sacrificing safety, performance, or features, instead of the Left’s too-often preferred paradigm of remaining stuck in gasoline-only cars and just ratcheting up the MPGs in an oil-only car at the expense of safety, performance, etc.

  • James

    It should be noted that the Model 3 is supposed to be a direct competitor with the BMW 3 series vehicles. BMW 3 series prices range from about $31k to a bit over $70k. I believe that people expect premium features to cost a premium.

    It should also be noted that the time it takes to toggle through the features on BMW’s web site is not much short than the time is takes to just wait for your Model 3. :p to BMW for poor web design.

  • J_JamesM

    Assuming that there is a HUD, how could they get away with not offering it? Putting the speedo on the tablet screen is all well and good for a demonstrator, but completely unacceptable for a production car. Will they put in a whole dashboard and instrument panel for those that don’t want to pay? I doubt it.

    Now, I can see the weird spaceship-helm steering wheel being an option. That makes sense. I bet they wish they had been able to make the Falcon Wing doors an option.

    • Charlie Delta

      A HUD might be a lot cheaper and easier to install than a giant dashboard that requires manual installation

      • J_JamesM

        That is my guess as well. I have a suspicion that most of the cost of the HUD is in simply designing it and dedicating computer software to its use. Electronics of every stripe have become very cheap lately. Thus, not a whole lot would be lost to simply put the HUD in all of the cars instead of just some of them, especially considering all the associated design and tooling costs associated with making a dash.

  • Charlie Delta

    I plan to max my Tesla out with every option up to $80k. Can’t wait

  • This guy is just blowing smoke. Many buyers will be satisfied with the standard battery, single motor and standard wheels, then add a few options, as I did when I bought a Model S 60 in 2015. The car is so far ahead of anything else on the road,

  • RMartens

    “Tesla says right up front it will build cars with the highest profit value first”

    Where’s your source for this? I’ve never seen any mention of this statement for the model 3.

    • Leeper

      Tesla 4th quarter earnings report for 2015.

    • Steve Hanley

      From the lips of Elon Musk his own self. Don’t have a link for you, but I remember him saying it last year after the astonishing number of reservations were received. He also said the very first cars would be built for customer who lived near the factory so any post production glitches could be addressed easily and quickly.

  • JP

    I think someone has had too many shots of Jameson…

    • Steve Hanley

      ; – )

  • WebUserAtLarge

    From a personal perspective, if I were to be shopping for a car, and if the price was a consideration, I would rather drive the least expensive Model 3 then a fully loaded Bolt. I would want a product from a manufacturer that is on the forefront of EV development, and not from one that builds EVs as an afterthought.

  • David

    I would call the $35,000 Model 3 is a “bait and switch” product. and, Tesla isn’t going to make it

  • Samson

    maxed out Model 3 will be $67500

  • chuckdaly

    “Tesla says right up front it will build cars with the highest profit value first”. This won’t happen as people will get tired of waiting and start to drop their reservations. Tesla will start to build strippers

  • chuckdaly

    “Tesla says right up front it will build cars with the highest profit value first”. Reservation holders will have waited about a year and a half, before the first cars hit dealers. Reservation holders waiting for low optioned models will quickly grow weary and cancel orders. The last thing Musk wants is dealer lots loaded with unwanted fully optioned cars. So Tesla will be forced to build a certain percentage of strippers just to keep reservation holders on board.