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Tesla attracts the masses with Model 3, logs 276,000 reservations

Demand for the freshly unveiled electric vehicle is off to a flying start. Now, Tesla will have to "rethink production planning," says CEO Elon Musk.

The Model 3 is set to widen Tesla's customer base thanks to its more affordable price tag.

In just a matter of days, Tesla has secured a cool $276 million in deposits from people who preordered its newly unveiled Model 3 electric vehicle.

That translated to 276,000 reservations, with potential buyers plunking down $1,000 each, by the end of Saturday. It turns out people can't wait to get their hands on Tesla's first attempt at an affordable electric car. But they will have a wait. Deliveries are scheduled to begin in late 2017 and the vehicle is expected to cost at least $35,000. The preorder numbers so far work out to almost $10 billion worth of sales, assuming all those people buy one. With extra features, the average cost of a Model 3 could be $42,000, the company estimates.

Tesla has been at the forefront of redefining how electric vehicles are perceived, but up until now its cars have been priced far beyond what most people can afford (starting at around $70,000). The Model 3, though not exactly cheap, will help the company appeal to a new group of customers, who for the first time may find one of the sleek electric vehicles within their price range.

The real challenge for Tesla now will be delivering when it says it will. The company was three years late bringing its Model X car to market. Chief Executive Elon Musk tweeted Friday that he will have to "rethink production planning" in light of demand for the Model 3.

"We will need to build a factory in Europe to serve long-term regional demand as Fremont reaches max capacity," he said Sunday, referring to the plant in the San Francisco Bay Area.

In what he described as an "impromptu Twitter AMA," Musk answered customer questions over the weekend about Tesla. Here are some other things we learned:

  • Drivers will soon be able to find out from within their cars which Superchargers are busy or free thanks to an over-the-air software update.
  • Superchargers are coming to Mexico this year and will hopefully "cover all of Italy" by the end of 2016.
  • Locations of future Superchargers will be decided based on preorders and demand.
  • You'll be able to put the back seats of the Model 3 down, which Musk says will make it "great for road trips and camping."

The CEO hinted that there's even more to be excited about. In reply to a tweet, Musk said that if the preorder trend continues, he expects Tesla could more than double the number of cars reserved after "part two" of the Model 3 unveiling.