Tesla Model 3 Release Candidates Being Built Using Production Tooling, Musk Reportedly Tells Investors

Tesla confirmed on March 2 that it was building Model 3 Beta prototypes. On Thursday, CEO Elon Musk told investors in a conference call that release candidates for the car were ready, according to Elektrek.

For the uninitiated, Beta prototypes are basically products that are handed out to a group of external testers, post the company’s internal testing. Release candidates are near-completion products, which are run through final testing before the launch.

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The fact that Model 3 release candidates are ready indicates that the company is moving closer to the car's launch. Musk revealed more details about the production status of the car in the conference call, according to the report. He addressed concerns that the size of Tesla’s offering was too small to make the Model 3 a success and said that the rise in production capacity was sufficient to bring the vehicle to reasonable production levels. Basically, this means that the company’s pausing of Model X and Model S production in February to make room for the Model 3 could potentially help it cope with the demand for the car.

Musk also said that in case Tesla needed to raise more money, the company could plan a “revolver or asset-backed line or warehouse line,” indicating that the company could probably make the extra chunk of money from its Gigafactories, whether by leasing them as assets or lending them to warehouses.

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He also revealed details about Model 3’s production process. The company focused on building tools to make the process of making parts more efficient. In fact, he said that the Model 3 prototypes were “almost entirely built with production tooling” and that the release candidate quality for Model 3 was much higher than that for the Model S or Model X.

Musk reassured investors in Thursday’s call that the Model 3 production was on track. The use of production tooling rather than mass-produced tools is an indicator of quality, so the prototypes would be better than the previous ones. But, whether the company could use the same process for mass production of the vehicle is not yet known.