Electric carmaker Tesla is finally launching its long-awaited standard Model 3 starting at $35,000 and shifting all sales online, the company said.
"The interior will be slightly better than was originally promised,"CEO Elon Musk told reporters on a conference call Thursday, adding that the base price doesn't factor in tax incentives or gas savings that may further lower the cost of buying and owning a Tesla. "From the beginning, this has been the goal."
"It's an incredible car, and at $35,000 there are still some pretty significant consumer tax credits that can be had," Musk said. Musk said he anticipates demand of more than 500,000 Model 3s a year. The company delivered 145,610 Model 3s in 2018 at far higher prices.
The base model of the Model 3 will have 220 miles of range, a top speed of 130 miles-per-hour and accelerate from 0 to 60 mph in 5.6 seconds, the company said.
Tesla is also changing the customer shopping experience, allowing customers to try out the car before buying and offering full refunds if a car is returned within seven days or 1,000 miles. It's pushing all sales online and to mobile devices and eliminating or reducing showroom staff as well.
"You can buy your car on your phone in about one minute in the U.S.," Musk said. "We will still have stores, but they will be converted to galleries and information centers."
In shifting sales online, Musk said Tesla will be closing some stores and laying off employees, which allows it to save money and lower the price of the car.
"There's just no way around that," Musk said. "I wish there was some other way."
He said it will be at least another two to three years before Tesla can produce a cheaper car.
"It is excruciatingly difficult to make this car for $35,000 and still be financially sustainable," he said.
The company's shares were halted, and Tesla suspended all orders on its website ahead of Thursday's news. It also redirected users to a page teasing a mystery announcement Musk promised to reveal at 5 p.m. ET, saying: "The wait is almost over."
Tesla has been promising a $35,000 version of the Model 3 ever since the automaker revealed the mid-size sedan in 2016. But it's prioritized the production of more expensive versions of the car in order to keep profit margins high. Musk has defended the decision by saying that making lower-priced versions was unprofitable and would cause Tesla to "die."
This story is developing. Check back for updates.