Photo: u/ffiarpg via Reddit
The revamped Tesla Model 3 is almost ready to meet the first customers, as trial production is already underway at Giga Shanghai. A new report indicates that the first deliveries are planned for October, while the pricing strategy, at least in China, is much more aggressive than before.
Based on the rumors from China, the refreshed Tesla Model 3 is already in trial production at Giga Shanghai. Although the development was done mainly in the US, the first Project Highland units will roll off the production line at Giga Shanghai. A new report from China shows that volume production will start next month, with the first cars delivered to customers in October. The announcement confirms previous rumors about the current model's production ending on August 14.
The new report also confirms that the refreshed Model 3 RWD will roll off the production line with a new battery supplied by CATL. Although this was rumored to use the lithium-manganese-iron-phosphate (LMFP) chemistry, further details show that CATL will provide its latest M3P battery cells to Tesla. In the M3P cells, the iron is enriched with a mix of materials that include magnesium, zinc, and aluminum. This gives the new cells a higher energy density than LMFP cells and a longer lifecycle.
The new CATL battery packs will allow a 66-kWh capacity for the Model 3 RWD. This represents a 10% improvement in battery capacity compared to the current Model 3 RWD LFP battery pack, which has a 60-kWh capacity. Tesla will let CATL handle more of the battery pack production to cut costs. Instead of supplying the cells, CATL is rumored to provide the entire battery pack and possibly the ancillary equipment, from thermal management to the battery management system.
This is important in cutting costs, as Tesla seeks to offer the updated Model 3 at a lower price point. Chinese media claims Tesla aims for a 200,000-yuan ($27,800) starting price for the RWD variant. This is significantly lower than the current starting price of 232,000 yuan ($32,255) and will make competitors freak out. You can call it price war 2.0, but the new price makes the Tesla Model 3 more affordable than the BYD Han, which starts at 210,000 yuan ($29,200), and BYD Seal, selling at 213,000 yuan ($29,600).
If Tesla sells the Model 3 Highland at this price in China, it's likely to also offer price reductions in other markets. Giga Shanghai is currently exporting the Model 3 mainly to Europe and Canada, and Tesla could drastically reduce the prices in these markets. I can imagine Volkswagen executives losing sleep, as Tesla is already eating their launch even at current prices. The Model 3 is no longer the popular model it was, being surpassed by the Model Y. Still, a revamped variant with a fresh design and exciting features at a lower price might change the rules of the game completely.
The new report also confirms that the refreshed Model 3 RWD will roll off the production line with a new battery supplied by CATL. Although this was rumored to use the lithium-manganese-iron-phosphate (LMFP) chemistry, further details show that CATL will provide its latest M3P battery cells to Tesla. In the M3P cells, the iron is enriched with a mix of materials that include magnesium, zinc, and aluminum. This gives the new cells a higher energy density than LMFP cells and a longer lifecycle.
The new CATL battery packs will allow a 66-kWh capacity for the Model 3 RWD. This represents a 10% improvement in battery capacity compared to the current Model 3 RWD LFP battery pack, which has a 60-kWh capacity. Tesla will let CATL handle more of the battery pack production to cut costs. Instead of supplying the cells, CATL is rumored to provide the entire battery pack and possibly the ancillary equipment, from thermal management to the battery management system.
This is important in cutting costs, as Tesla seeks to offer the updated Model 3 at a lower price point. Chinese media claims Tesla aims for a 200,000-yuan ($27,800) starting price for the RWD variant. This is significantly lower than the current starting price of 232,000 yuan ($32,255) and will make competitors freak out. You can call it price war 2.0, but the new price makes the Tesla Model 3 more affordable than the BYD Han, which starts at 210,000 yuan ($29,200), and BYD Seal, selling at 213,000 yuan ($29,600).
If Tesla sells the Model 3 Highland at this price in China, it's likely to also offer price reductions in other markets. Giga Shanghai is currently exporting the Model 3 mainly to Europe and Canada, and Tesla could drastically reduce the prices in these markets. I can imagine Volkswagen executives losing sleep, as Tesla is already eating their launch even at current prices. The Model 3 is no longer the popular model it was, being surpassed by the Model Y. Still, a revamped variant with a fresh design and exciting features at a lower price might change the rules of the game completely.
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