Elon Musk Reveals How the $35000 Model 3 is So Cheap


Elon Musk Reveals How the $35000 Model 3 is So Cheap

Details elsewhere are scant, but we understand the Model Y will ditch the complex and expensive "Falcon" doors fitted to the £80,000 Model X SUV and should be closer in price and size to the Model 3 saloon. Battery cell production for Tesla's Powerwall and Powerpack started at the Gigafactory in January, while production of Model 3 battery cells began in June.

Earlier in the week, Elon Musk's luxury electric auto maker was expected to raise at least $1.5 billion to accelerate production of its new Model 3, but strong demand allowed the carmaker to raise more, albeit at a slightly higher yield than expected. Musk described the story as "total nonsense".

If the introduction goes as planned, the Model 3 will take Tesla and its sole assembly plant into the realm of high-volume production.

Musk's claim has been reported by green vehicle blog Electrek, which cites two sources involved in a conference call for bondholders. By selling bonds now, Musk can raise cash for Model 3 production without diluting equity holders.

"His analysis came after Tesla announced on its website that it will be offering "$1.5 billion in aggregate principal amount of its senior notes due 2025".

Tesla already has about 500,000 pre-orders for the Model 3.

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He also hit out at Nitish Kumar, upset that he "did not even discuss with us" the decision to partner with the BJP in Bihar. On Wednesday, a close aide of his hinted to PTI news agency that Yadav could form a new party.

Musk hopes to accelerate production cycle time through a combination of plant automation and by designing vehicles for simpler construction - such as the Model 3 and the Model Y.

Albertine is not so sure. In a CleanTechnica report, up to 50% of current EV drivers plan to get a Tesla Model 3 next.

However, Musk conceded that the biography overall was not entirely flawed, calling it "mostly correct", but saying that the story was "rife with errors and never independently fact-checked" despite his request for that.

So far, Tesla has been raising money to pay its bills with a combination of equity offerings and convertible bonds, which eventually convert into shares. Seeking Alpha calls this deal "singularly unique", in that few companies with the market capitalization of Tesla at $59 billion carry speculative grade debt ratings.

Tesla's cash burn has prompted short-sellers like Greenlight Capital's David Einhorn to bet against the Palo Alto, California company.

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