This past week saw one of the great moments in the history of the automobile. Tesla Motors began accepting orders on the Model 3, an all-electric car with a range of 215 miles and a base sales price of $35,000.
Up to 325,000 people each put down a $1,000 deposit to reserve a vehicle - in the first week - which equates to over $10 billion in sales. For perspective, the Toyota Camry, the best-selling car in the country, sold about 430,000 units for all of 2015.
Thousands stood in line for hours at Tesla stores around the world. All this, despite knowing that it would be two years, perhaps longer, before most would take delivery. This feat was a tremendous accomplishment for Tesla and a tribute to the enormous power of the brand that Elon Musk and his team have built. But it was also something even bigger. It was a demonstration of the power of the electric car, and the overwhelming desire of the public for electric cars, once concerns about range could finally be resolved.
And why shouldn't there be desire? The 425,000 Americans who drive electric cars have long known that these are just better cars, for a long list of reasons. Electric cars are fun to drive, quiet and powerful. They're not expensive, especially when you consider the savings in gas, low maintenance, and the various available credits and rebates. They're convenient--say goodbye to gas stations and oil changes. They're good for national security and the economy--I produce my fuel from solar panels on my roof instead of buying it from the Middle East. And they clean the air and protect the climate.
There has been speculation that demand for electric vehicles has peaked and they would never appeal to the mass market, even once the new generation of 200-mile range vehicles hits the road. But after this week, those concerns are clearly gone. The public demand for electric vehicles with a 200-mile range and a moderate cost turns out to be vastly larger than anyone had previously imagined, despite the low price of gas.
The tremendous demand for the Model 3 should give comfort to Carlos Ghosn of Nissan, Mary Barra of General Motors and other automakers who are boldly investing billions of dollars into building the new generation of 200-mile range electric vehicles--and wondering whether the demand for the cars is really there. Well, it's there. It turns out that this is a very big sandbox, and there is plenty of room for everyone to play.
The fact that Tesla uncovered such extraordinary demand for a vehicle years from delivery suggests there is plenty of room for other automakers to succeed as well. Just as there are many different gasoline cars, there is every reason to believe there will be successful electric cars matching a wide variety of lifestyles, driven by the biggest change in automobile technology since the Model T.