Tesla Model III Could Cost US$50k Or More: Report Photo:

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Trevor Collett | Sep, 26 2014 | 7 Comments

Tesla’s first ‘people’s car’ in the Model III (or ‘3’) will hit the market priced at around US$35,000 (AU$39,760), according to CEO Elon Musk.

That would see the III take on the BMW 3 Series, Audi’s A4 and the Mercedes-Benz C-Class, but a report out of the US suggests meeting that price-point in the new model will be a struggle.

Advanced Automotive Batteries’ Dr Menahem Anderman has prepared something of a case study on Tesla, and the findings indicate battery prices will be a major hurdle.

While Tesla’s new Gigafactory will drive battery prices down in the long term, the savings - measured in dollars per kWh - may not come soon enough for the III to have a 3 Series-matching price.

With all things considered, the report predicts an arrival-price for the new Model III of around US$50,000 (AU$56,800), rising to as high as US$80,000 (AU$90,889).

The latter would be a worst case scenario, as even the larger and upmarket Model S will soon be available in Australia with a comparable starting price.

Tesla Model S
Tesla Model S

But a US$50,000 price would see the Model III thrust into BMW 5 Series territory, which has a starting price in the US of around US$49,500 (AU$56,238).

The Model III is unlikely to be a match for the 5 Series on size, performance or perhaps even prestige, but the ‘X-factor’ that comes with the Tesla badge means it’s still every chance of becoming an instant success.

Recent reports suggest Tesla is close to cracking the $200/kWh price point, and Mr Musk has previously predicted that price will be halved by 2025.

Dr Anderman’s predictions are less optimistic, foreseeing a price of $167/kWh in the year 2025 with the price to stay above or close to $200/kWh until at least 2020.

The Tesla Model III is due to hit the market in 2017.

MORE: Tesla News and Reviews

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