Orders for Lower-Priced Tesla Hit 198,000 | NECN

Orders for Lower-Priced Tesla Hit 198,000

"Thought it would slow way down today," Tesla founder Elon Musk tweeted Friday



    Tesla Motors unveils the new lower-priced Model 3 sedan at the Tesla Motors design studio in Hawthorne, Calif., Thursday, March 31, 2016.

    Demand for Tesla Motors' new lower-priced electric car surprised even the company's CEO Friday as 198,000 people plunked down $1,000 deposits.

    "Definitely going to need to rethink production planning," CEO Elon Musk said on his Twitter feed.

    Musk unveiled the car Thursday night at a design studio near Los Angeles. It starts at $35,000 and has a range of 215 miles per charge, which is far more than most people drive each day.

    The orders came from across the globe even though the car isn't scheduled for sale until late in 2017. But they could jeopardize a $7,500 U.S. electric car tax credit that many buyers are counting on to reduce the price. The tax credits gradually phase out after a company hits 200,000 in U.S. sales.

    A Tesla spokeswoman wouldn't say how many of the 198,000 orders came from the U.S.

    Thursday night, Musk said Tesla had 115,000 orders since the company started taking them earlier in the day in Australia. There were long lines at Tesla stores from Hong Kong to Austin, Texas, reminiscent of crowds at Apple stores for early models of the iPhone. But the number kept rising into Friday.

    "Thought it would slow way down today, but Model 3 order count is now at 198k," Musk tweeted during the afternoon, saying the wait time for the car is "growing rapidly."

    The Model 3 is less than half the cost of Tesla's previous models. Its range is about double what drivers get from current competitors in its price range, such as the Nissan Leaf and BMW i3.

    Prototypes looked like a shorter version of Tesla's Model S sedan. The Model 3 has a panoramic glass roof and an elongated hood. Inside, it seats five and has the same large touchscreen dashboard as other Teslas. It also has Tesla's suite of semi-autonomous driving features, including automatic lane changing and lane keeping. Musk said it will accelerate from zero to 60 in less than 6 seconds.

    Tesla has a history of missing deadlines for its vehicles to hit the market, but Musk said Thursday that he feels "fairly confident" that the Model 3 will come out next year.

    The lower-priced car is the most serious test yet of 13-year-old Tesla's ability to go from niche player to a full-fledged automaker. It could be the car that finally makes electrics mainstream — or consumers could continue to be skeptical that electrics will work for everyday use. In the U.S., they still make up less than 1 percent of annual sales. Either way, the Model 3 is already changing the industry, spurring competitors to speed development of electric cars.

    General Motors Co. is set to start selling the Chevrolet Bolt electric car at the end of this year with a similar price tag and a 200-mile range. Hyundai's Ioniq, which has a 110-mile electric range and could match Tesla on price, goes on sale this fall. Audi will follow with an electric SUV in 2018.

    Musk said last month he's not worried. He thinks the Model 3 will compete most directly with small luxury cars such as the Audi A4 and the BMW 3 Series.