Tesla’s $35,000 Model 3 will start production in 2017

God bless Elon Musk and his Twitter feed. While other companies rely on secretive press offices or employ PR giants to handle their communications, Musk happily uses the 140-character platform to break news about what's going on at Tesla and SpaceX. Wednesday, we learned that the Model 3—Tesla's next electric vehicle after the Model X SUV—will go into production in 2017, but only once the Gigafactory is up and running.

Model 3, our smaller and lower cost sedan will start production in about 2 years. Fully operational Gigafactory needed.

— Elon Musk (@elonmusk) September 2, 2015

The Gigafactory is a $5 billion plant that Tesla is building near Sparks, Nevada in partnership with Panasonic. The plan is to achieve significant economies of scale at the Gigafactory, which will make the Model 3's $35,000 price tag possible—something Musk also told us via Twitter yesterday.

@elonmusk $35k price, unveil in March, preorders start then.

— Elon Musk (@elonmusk) September 2, 2015

When the Model 3 hits the streets in 2017 (assuming no Gigafactory-related delays) it won't have as easy a time in the marketplace as the Model S, which even now still has no real competition. Chevrolet is launching the Bolt next year, a $30,000 EV which will match Tesla's 200-mile (321km) range. However, Tesla has cleverly positioned itself as a premium brand with the Model S (and forthcoming Model X). Leveraging that cachet to move Model 3s seems like a no-brainer.