The Model 3 will be the company's fourth vehicle and will be aimed at the budget crowd, rather than the high-end market like the Tesla Roadster, Model S sedan, and Model X SUV.
Musk has revealed the Model 3 will cost $35,000 before incentives. As we've broken down before, the incentives for electric vehicles can be effective in saving money before they expire in 2018.
What customers will pay depends on whether one's tax situation enables federal credit eligibility and the place of residence for purchase, regarding potential state perks. On the extreme end, a Colorodan could purchase a Model 3 for $21,500.
Musk has revealed in the past the Model 3 won't feature many bells and whistles -- at first. Many automakers follow a similar trim system, offering more features for a higher price.
Musk said "more adventurous" models of the Model 3 will come.
"The Model 3 is critical to Tesla's ability to transition to niche to a higher-volume car maker," said Stifel analyst Jamie Albertine.
Size and range
The Model 3 will continue Tesla's tradition of being all-electric, and it will have a range of 200 miles. To compare the Bolt will have a range of "more than 200 miles".
Musk hasn't detailed the design of the Model 3 or released any images of the car, but it's likely to take concepts from the Model S and Model X to make the smaller sedan.
Tesla CTO JB Straubel has compared the design of the Model 3 to the BMW 3-series and Audi A4. It will be a smaller sedan for city commuting, and the 200 mile range should help cure "range anxiety".
A Tesla Motors Club forum poster also claimed to have gained some new information from a company "insider", who says the Model 3 looks like a smaller Model S, and has fewer luxury features. The insider also claims Tesla may show a stripped down Model X SUV called the Model Y at its March event.
Analysts and investors have voiced concern that Tesla won't have the battery supply to build enough Model 3s to be meaningful to its bottom line -- Tesla disagrees.
"The Tesla Gigafactory was born of necessity and will supply enough batteries to support our projected vehicle demand," the company says in a description of the factory on its website.
The Gigafactory is home to the manufacturing of Tesla batteries.
"Basically, to the best of our knowledge, you should not worry about the Gigafactory as a constraint on Model 3," Tesla CEO Elon Musk said during the company's most recent earnings call (according to Reuters' transcript). "That does not appear to be anywhere near the critical path for Model 3."
Tesla expects to sell a total of 500,000 vehicles by 2020.
Tesla has confirmed that on April 1 customers will be able to pre-order the Model 3 online before it hits the streets in late-2017. We assume this pre-order system works on a first come, first serve basis.
Update: A previous version of this article incorrectly stated the event date as March 30.