THE first Tesla Model 3 electric car for the masses should come off the assembly line by this weekend with the first deliveries in late July, the company's CEO says.

Elon Musk says the new car passed all government regulatory requirements for production to begin two weeks ahead of schedule.

The company plans to hold a party to hand over the first 30 Model 3s to customers on July 28, Musk wrote in a tweet.

But the biggest novelty is that in the US the basic version of the Model 3 will cost $US35,000 - $US27,500 ($A45,700 - $A35,900) after knocking off the subsidy for buying an electric car - and, according to Musk, will therefore be the best vehicle for the money and will appeal to a mass market.

Up to now, Tesla has manufactured and marketed only luxury autos whose lowest prices have been double that of a Model 3.

Tesla says the five-seat car will be able to go 346 kilometres on a single charge and will be sporty, accelerating from zero to 100km/h in under six seconds.

Musk tweeted that the company expects to produce 100 cars in August and more than 1,500 in September.

"Looks like we can reach 20,000 Model 3 cars per month in December," he wrote.

Tesla has made a high-stakes bet on the success of the Model 3, of which the manufacturer expects to be producing a half million a year by 2018.

Tesla’s cheap Model 3 is ahead of schedule, according to Elon Musk. Picture: Justin Pritchard
Tesla’s cheap Model 3 is ahead of schedule, according to Elon Musk. Picture: Justin Pritchard

Musk's tweets about the Model 3 appear to erase doubts that Tesla would be able to meet deadlines for mass producing the cars, which is key to the company making money. Previously it has faced delays in getting vehicles to market.

Tesla's last new vehicle, the Model X SUV, was delayed nearly 18 months. Musk says the Model 3 is much simpler to make, but 14-year-old Tesla has no experience producing and selling vehicles in high volumes.

Tesla made just 84,000 cars last year. Bigger rivals like General Motors, Volkswagen and Toyota routinely sell around 10 million vehicles per year.

Even if the Model 3 is on time, servicing all those vehicles will still be a challenge. Model S and Model X owners are already worried about having to share Tesla's company-owned charging stations with an influx of new cars.

And while Tesla is promising to increase its network of stores and service centres by 30 per cent this year, it began 2017 with just 250 service centres worldwide. That leaves many potential owners miles from a service centre.

Musk has said a new fleet of mobile service trucks will be deployed to help customers who are far from service centres. Tesla also plans to double its global high-speed charging points to 10,000 by the end of this year and increase them by another 50 per cent-100 per cent in 2018.

Until recently, Tesla owned the market for fully-electric vehicles that can go 200 miles (322 kilometres) or more on a charge.

But that's changing. GM beat Tesla to the mass market with the Chevrolet Bolt, a $36,000 car that goes about 383 kilometres per charge.

Audi plans to introduce an electric SUV with 483 kilometres of range next year; Ford will have one by 2020. Volkswagen plans more than 30 electric vehicle models by 2025. Automotive competitors like Mercedes and Volvo - not to mention tech companies like Google and Uber - can also match Tesla's efforts to develop self-driving vehicles.

And they have deeper pockets. Tesla has had only two profitable quarters in its seven years as a public company.

News Corp Australia

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