Tesla is skipping “beta”—sort of. On Friday, Musk fired off a barrage of 50 messages on Twitter while on a flight to Cape Canaveral, Florida. Among them was a six-second video clip, the first glimpse of what he calls a “release candidate” Model 3. The term is more typically used in the software industry, referring to a final version that’s almost ready for public release.

Musk is condensing the typical timeline for a new car. A traditional auto manufacturer spends about six months testing beta cars prior to a rollout. Musk seems to have skipped a step, and is building test vehicles using the same equipment line that will feed mass production. If that’s the case—and this truly is a “release candidate”—then it implies that production is on track. The car looks very much like the vehicles Musk showed a year ago, and that fidelity to the original prototype will have helped keep engineers on schedule.

A standing army of testers. There’s tremendous demand for the Model 3 among Tesla’s 30,000 employees—most of whom are probably unable to afford the pricier Model S and Model X. Musk is putting that interest to use, releasing the first several thousand Model 3s to employee reservation holders.

This is a huge advantage unique to the Model 3. As early problems are identified, they can be fixed at the work site. If there’s a hardware problem that requires a recall of the fleet—as happened with a seat defect in the first 2,700 Model Xs—employees need only drive to work to have them fixed. This means that even while Tesla shortens pre-launch testing, by the time production ramps up to a wider audience, the Model 3 may have nevertheless undergone more rigorous internal troubleshooting than most cars. 

Features are being stripped down. One of the primary goals of last week’s Twitter barrage appears to be downplaying expectations for new features. Musk said there will only be one display—the car’s 15-inch touchscreen—with no additional gauges or heads-up-display projected at the windshield.

Additionally, the dual-motor all-wheel drive, and high performance versions of the Model 3 will be delayed for six to nine months to keep the rollout simple. Musk’s stream of clues may have taken the place of a second unveiling he had previously indicated would come by April. It looks like the company decided to keep it simple, and there’s not much more to unveil.

It’s simpler to make. Musk has been making the case for the last year that the Model 3 is designed for manufacturing efficiency. Steel is used for some of the body instead of an all-aluminum build. The amount of wiring in each car has been cut in half, from 3 kilometers worth in the Model S to 1.5 kilometers in the Model 3. There’s one screen and one computer now instead of two of each in the Model S. And there are no eccentric flourishes like self-presenting door handles or falcon-wing doors.  

Top-tier suppliers. Tesla also gets to pick from the best, most reliable suppliers. When the carmaker first built the Model S, suppliers assumed it would never sell more than 3,000 units and the company would eventually go bankrupt, according to Musk. That’s changed. It “went from basically getting like the worst team on second-tier suppliers to getting the best team on first tier suppliers,” he said in February. “Really big difference.”

Levers of Demand
If, against all odds, Tesla is actually able to produce 500,000 cars in 2018, there’s still the question of whether it will be able to sustain that kind of demand, which would establish it as the leading U.S. luxury car manufacturer.

Again, Tesla has some levers left to pull. The company has never paid for television or print advertising. There will also be attention-grabbing upgrades. Musk said last week that a crossover version of the Model 3, called the Model Y, will be coming in the next few years. Given U.S. preferences, that’s likely to be Tesla’s most popular car yet, and it's a good strategy to first establish the scale of a mass-market manufacturer before releasing it. And of course, there is the last big mystery...