The air was electric in Fremont, California, where a lucky few gathered to witness a momentous moment. Thirty employees rubbed their hands together in glee, awaiting their prize after months of waiting. Elsewhere around the world, the faithful—the 500,000-odd people who threw down a $1,000 reservation deposit months ago—refresh their email for notifications. Happy Model 3 Day, Tesla fans.

Everyone is excited for a reason. The arrival of Tesla’s Model 3 signals a new chapter in automotive history, one that erases 100-plus years of the gas engine and replaces it with technology, design, and performance hot enough to make electric vehicles more than aspirational—to make EVs inspirational.

Tech trend-watchers may be getting flashbacks to 2007, when another marquee event felt like it was on the cusp of revolutionizing the world: If Tesla gets this right, the Model 3 will be the iPhone of the car world, leading the way for a whole pack of imitators. It may even steer the world toward a road populated by not just electric vehicles but driverless cars, and realize that reality faster than anyone—even Google—has managed thus far.

For one night, Tesla founder Elon Musk hosted a party to mark his smallish car company’s milestone; but the next day, it’s back to work on building a new, “affordable” electric car—and fighting to become a major player in the competitive car industry.

Creating the Electric Dream

If one is to harken back to draw a comparative analysis to 2007, it’s worth remembering that just as there were smartphones before the iPhone, there are other electric cars available now. But those other vehicles are clunky and awkward. The Chevrolet Bolt rivals the Model 3 in range and price (and beat it to market), but it hasn’t captured the public imagination. The BMW i3 is futuristic, using novel materials and the option of a tiny range-extender engine, but buyers aren’t clamoring for it.

With the Model 3, Tesla promises a smoothly integrated electric driving experience, from generation to acceleration. Customers can walk into shiny white Tesla stores, order a car, a solar roof, and a home storage battery. They can take long road trips knowing they have access to a proprietary Supercharger network for high-speed top-ups. It’s a neat, tidy, contained ecosystem—just like Apple’s.

And as with Apple, the Tesla brand and Elon Musk’s celebrity is enough to create a fanbase that is legion and enough potential buyers to excite competitors: Audi, Jaguar, and Porsche, have all shown electric car concepts that are not just functional, but damn sexy. The e-tron Sportback, the I-Pace, and Mission E all have Tesla in their crosshairs.

“I have to hand it to Tesla, and the leadership in particular, for being able to create the hype and use public market equity as a source of for generating a whole new narrative about cars,” says R. A. Farrokhnia, a Columbia University business and engineering professor.

Building an Autonomous Future

The car should be a leader in self-driving, too. Right now, Tesla’s Autopilot function is semiautonomous, so the car will only drive itself on a highway and requires a person behind the wheel. But some day soonish, Tesla will send an over-the-air update that enables full self-driving for all its cars on the roads—no hardware changes needed. It’ll be like the day Apple introduced the App Store. Flicking that switch led advances that nobody imagined from a phone: new ways to do things like date and move money, social media’s dominance, and the rise of the sharing economy. This Tesla change will enable drivers to come up with clever ways to lend, share, and monetize their vehicles in ways that are inconceivable now.

Tesla already has some ideas. Musk’s master plan is to help owners add their vehicles to a shared fleet at the touch of a button. Instead of sitting unused 22 hours a day, the car will be able to drive itself and passengers, to earn money for you while you sleep, work, or go on vacation. That puts the company in direct competition with other giants of the auto world, from Uber working on driverless cars and Waymo testing self-driving minivans in Arizona to NuTonomy running driverless taxis in Boston.

And, of course, driverless cars also have a big social upside, with the potential to cut crashes and save up to 37,000 American lives a year. They’ll limit congestion by using roads more efficiently, and reinvent cities, which might not need to provide acres of parking.

Scaling Up

Tesla has to get bigger with this new car. A lot bigger. The company wants to build 500,000 cars in 2018, about twice as many as Porsche built in 2016. (VW, Toyota, or GM ship over 10 million vehicles a year.) But there are probably limits to its bigness.

“If Tesla can pull off the launch of the Model 3, they’ll establish a niche as the cool electric car maker,” says Wallace Hopp, an auto business professor at the University of Michigan. “But I suspect the bulk of EVs are going to be built by the traditional automakers, who will make cheaper cars that are functional and reliable.”

Tesla might never have the number-one spot in sales, just as Apple’s iOS is outsold by Android. Heck, it may never actually make a profit. But that won’t matter—those aren’t Elon Musk’s goals. He’s always said the aim of the company is to accelerate the world’s transition to sustainable energy. He seems on track to do just that.

Design Is How It Works

The last, crucial, part is design. The Model 3 looks hot, not dorky. There’s no embarrassment in pulling out an iPhone, and similarly, there will be no embarrassment in pulling up to any party in this electric vehicle. The Model 3 looks good not because its designers have pulled quirky (and dateable) tricks, but because it focuses on clean, clutter-free lines. Inside there’s just one large screen, in the center of the dash. Outside, it looks like a shrunken down version of the Model S, its larger stablemate.

Designers say its simplicity gives it longevity. “I think all of their model range will last well, whereas other vehicles like the Bolt are going to age quickly,” says Geoff Wardle, who teaches transportation design at ArtCenter, College of Design in Pasadena, California.

But to focus on the seats, screen, paint, or even price loses sight of the bigger picture of what makes the Model 3 unique: tech. It comes laden with sensors, has an onboard supercomputer, and Tesla engineers can push out software updates the way Apple does.

“What we’re seeing is the difference between a technology company that makes cars and a car company that incorporates technology,” says Jeff Miller, a computer science professor at USC.

The Model 3 is virtually futureproof. If Tesla’s engineering team has a good idea and can write the software, they can give the car new abilities with the tap of a touchscreen. What Tesla is delivering today is just the start. Welcome to the 21st century, automakers.

Editor’s Note: This story was originally published on June 28, 2017. It has been updated to reflect new details about the Tesla Model 3.



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