Tesla readies Model 3 for Europe launch

Tesla will start the European rollout of its Model 3 in February, putting pressure on German premium brands that have seen the Model S outsell flagship sedans such as the Mercedes-Benz S class.

The Model 3 will cost 63,000 euros ($72,000) in Germany for the long-range battery pack version, a German Tesla dealer said.

The Performance version, which adds a second electric motor, will also be sold in Europe. The German dealer would not comment on the price of the Performance version but a U.K. dealer estimated it would cost around 72,000 pounds ($92,000). The prices do not include local purchase incentives for electric cars.

First deliveries of the Model 3 in German-speaking markets will go to Switzerland, the German dealer said. Norway will also see cars in February, according to a tweet from a Norwegian on the reservation list. Tesla was not available for comment.

Customers without reservations will get a car quicker if they choose the more expensive Performance version, the German dealer said. Customers ordering the less expensive version would receive their car in the summer, the dealer said.

Production for right-hand-drive models will start early 2019, the U.K. dealer said. U.K. dealerships expect the first deliveries to start in the spring.

The Model 3 could attract customers of midsize premium sedans who are looking to switch to a battery-powered car from a gasoline or diesel vehicles. Sales of higher-powered versions of the BMW 3 series and Mercedes C class could be hit.

Among full-electric cars, the Model 3 will go up against the Jaguar I-Pace and the Audi e-tron, which are both being rolled out in Europe. It’s also likely to cannibalize sales from Tesla’s own range, especially the Model S, among customers who want the latest electric car and are less concerned about the category it sits in.

The Model S now outsells the range-topping sedans from Mercedes, BMW and Audi in their European home markets. In the first 10 months, the Model S had sales of 13,209 in Europe, according to JATO Dynamics market researchers. The No. 2 seller was the S class with a volume of 12,688, followed by the BMW 7 series with sales of 8,221 and the Audi A8, which sold 4,854 units.

Tesla also sold 8,801 units of its Model X crossover in Europe through October, according to JATO data. A smaller crossover badged Model Y will be unveiled next year, Tesla CEO Elon Musk has said.