The Tesla Model 3 will be released before the 2017 ends, with 100,000 units expected to be delivered for early buyers. The mass production of the battery electric vehicle is the first of its kind to enter the mainstream market.
The target will demand a production rate of 5,000 cars per week. Skeptics who base on the past failures of Tesla to meet release deadlines have something to look forward to, with an increase in supply chain partnership with the firm being reported.
Tesla's former vice president of supply chain management Peter Carlsson earlier expressed in an interview with electrek that the increase in demand for the product helped in convincing the suppliers to work with them — furthering the capacity of the company to produce more and to enter the market.
"Things will get a bit easier. Tesla has resolved some issues through vertical integration — doing things internally. And with the launch of the Model 3, the volumes of the business will be more attractive, and I think we will see more suppliers relocate," Carlsson explained.
With the surge in demand for the vehicle, Tesla announced that the company will raise capital through public offering.
The firm plans to offer common stocks amounting to $250 million and convertible senior notes amounting to $750 million. Tesla CEO Elon Musk is among the expected buyers of common stocks — with reports pegging his purchase figures at $25 million.
Musk said during the fourth-quarter earnings call according to Business Insider that there is no need to raise capital for the Model 3. However, the CEO is still aware of the risks.
"But we get very close to the edge, then that's probably not the very best thing for shareholders on a risk adjusted basis so we are considering a number of options, but I think it probably makes sense to raise capital to reduce risk," he said in the same interview.