Electric car manufacturer Tesla today confirmed its future plans. We had heard chatter a couple of months before that the company would release a cheaper and smaller car which is exactly what it will do in a few years time. It confirmed today that Tesla’s Gen III car, due after the Model X, will be called the Model 3. According to a new report the Model 3 is going to be 20 percent smaller than the Model S and will have a 200 mile range on a single charge. Its primary competitor is said to be the BMW 3 series.

Tesla founder and CEO Elon Musk told Auto Express in an interview that the company decided to go with the Model 3 moniker once Ford threatened to sue over the trademark for “Model E.”

The Model 3 won’t be formally unveiled until 2016 and it will hit the market sometime in 2017 provided that there are no delays in production. Tesla’s vice president of engineering Chris Porritt has already said that this new car won’t be based on the aluminum platform like the Model S and that the company would look towards more cost-effective battery technologies to keep the overall cost down.

Tesla is yet to show off the Model 3’s design or confirm for how much it will be sold. Previous reports have suggested that it may be in the $30,000-$35,000 range, and if that’s true, then Tesla is likely to attract a lot of customers at the new price point.

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