Tesla Model 3Tesla will reveal its crucial Model 3 electric car on March 31 – the £30,000 volume EV it hopes will give it the higher sales necessary for long-term sustainability.

Sitting below the Model S saloon and new Model X crossover, the Model 3 will be similar in size to an Audi A4, BMW 3 Series and Mercedes-Benz C-Class: not only that, it also has those three cars directly in its sights as a full EV alternative to the top-selling German compact executive cars that dominate the sector.

Tesla boss Elon Musk has revealed the Model 3 is around 20% smaller than the Model S, a car nearly 5 metres long. The Audi, BMW and Mercedes-Benz are all around 4.6 metres long.

The all-electric Model 3 will, on the insistence of Musk, have a range of at least 200 miles, although the reality is that most customers expect at least 20% more, he added. Call it 250 miles then – not far shy of the larger Model S.

Technically, achieving such a range in a more compact car is an interesting challenge – particularly as Tesla will also have to maximise interior space and luggage capacity to ensure its market appeal is as broad as possible. This makes it likely some next-generation battery technology may debut in the Model 3.

This will also give it the standout performance that’s becoming a Tesla trademark. Expect best-in-class acceleration figures, with numbers likely to challenge sports cars for potency.

Following the reveal at the Tesla Design Studio in California on March 31, pre-orders for the new Model 3 will open, although first deliveries are not expected until 2017.

Musk has also said a crossover version derived from the Model 3 will be launched later, likely to be called Model Y.

The Model 3 will be key to Tesla hitting its goal of selling 500,000 cars by 2020. Last year, it sold 50,000.