Tesla Inc. is nearing the final stages before starting trial production of its revamped Model 3 sedan in Shanghai, according to people familiar with the matter, a variant of electric car that Elon Musk is betting can compete more effectively with Chinese rivals.
The revised version of the Model 3, Tesla’s first mass market EV that helped propel the company to profitability, is slightly longer than the earlier version, is more sporty and has a sleeker interior design, the people said, asking not to be identified because the details are private.
Some production staff at Tesla’s Shanghai facility have been required to place their mobile phones in purpose-built lockers outside the factory’s production lines since earlier this month to prevent potential photo leaks, one of the people said. The production line of Phase 1 of the plant might be offline for a few days at the end of this month for adjustments, they added, noting those plans may still be subject to change.
A Tesla representative said the company had no immediate response.
Tesla first unveiled the Model 3 in the US in 2016 and started mass production the year after. It further reduced its manufacturing costs with the ramp-up of its Shanghai facility at the end of 2019. Last year, Tesla teased that it would have some upgrades to the car’s interior and power systems as part of a refresh, without elaborating.
In China, Tesla’s most important market outside of the US, it’s becoming crucial for the company to refresh its product line up. The EV arena there is intensely competitive and a price war, kicked off by Tesla itself at the start of the year, has mushroomed, resulting in steep discounts across a range of models.
There are at least 155 pure electric and plug-in hybrid models expected to be unveiled in China this year alone, according to Sanford C. Bernstein.
Tesla has slightly raised prices of its models in both the US and China in recent weeks after its first-quarter earnings disappointed some investors. The pricing of the new Model 3 remains highly confidential and it’s not yet clear how fluctuating raw material expenses may factor into its eventual sticker cost.
Read more: Four Reasons Tesla Prices Keep Changing
Recent speculation online about the revamped car has centered around a steering wheel design that’s similar to the Tesla Semi and the Model S, with the absence of a traditional stalk, perhaps supporting rumors of a shift toward on-screen controls for toggling between park, drive and reverse modes.
Tesla contributed almost one-quarter of Shanghai’s total automotive production value last year, and local authorities pledged last week to continue to boost ties with Tesla in bringing autonomous driving and robot modules to Shanghai. More than half of Tesla’s global deliveries in 2022 were manufactured at the Shanghai plant, which can now produce a maximum of 1.1 million cars a year.
--With assistance from Dana Hull.
