Tesla (TSLA) Model 3 Update: Preparation For Car Production To Begin Feb. 20: Report

Tesla Inc. will start preparing for a full-scale commercial production of its Model 3 sedan on Feb. 20, according to a report.

"This will allow Tesla to begin Model 3 production later this year as planned and enable us to start the ramp towards 500,000 vehicles annually in 2018," a Tesla spokesman said Wednesday, according to Reuters.

The company has plans to shut down production at its California assembly plant for around seven days to prepare for the high-volume production of its first mass market-oriented car— the Model 3. It will start test-building the car later this month, Reuters reported citing sources. Test-building refers to making the final design changes before the car goes to commercial production.

Tesla’s target is to start full-scale production of the car by July 2017, the report added.

Model 3 is expected to cost around $35,000 and have the seating capacity for five people. It is expected to come with the company’s latest Autopilot hardware and software. According to Tesla’s website, the car will run 215 miles on a single charge and accelerate from 0-60 miles per hour in six seconds.

Tesla CEO Elon Musk had said in a call to investors in May last year that the company had received more than 370,000 reservations for the Model 3. The company plans to expand production to reach a production target of 500,000 cars by 2018 — five times the company’s 2016 vehicle production. The goal seems ambitious since the total number of electric cars sold in 2016 in the United States amounted to just 84,725 vehicles, according to data from the Electric Drive Transportation Association.

Tesla is pinning big hopes on Model 3 considering the automaker has not had a profitable year since 2010, despite having progressively increased its market capitalization.