Confirmed as part of the company’s Fourth Quarter 2015 Financial Results, the Model 3 will be roughly the same size as the Audi A4, BMW 3 Series and Mercedes-Benz C-Class, targeting a much higher-volume segment than Tesla has competed in before, particularly in European markets.

It will feature similar drivetrain technology to the larger Model S saloon and seven-seat Model X SUV, which is launching in Europe shortly, with large capacity batteries, ranges of up to 482km and fast recharging times.

Preparation is underway for production, with Tesla indicating that it will start building battery cells at its ‘Gigafactory’ in Nevada – a joint venture with Panasonic – this year. The company sold had sold 107,000 cars globally at the end of last year, with the Model S outselling the Audi A7 and A8 combined, and the BMW 6 Series and 7 Series combined, in Europe, the company said.