Tesla's Model 3 launch could be as big as the introduction of the iPhone by Danielle Muoio on Jul 28, 2017, 2:37 PM Advertisement
 Longtime Apple analyst Gene Munster said the launch of Tesla's Model 3 will be as big as the introduction of the iPhone. Tesla will hand off its first mass-market sedan, the Model 3, at a party on Friday night. The event will mark the start of production, which Tesla aims to ramp up to 20,000 vehicles per month in December. Munster, who has for decades covered tech behemoths like Apple, Google, and Amazon, is bullish on Tesla and has argued that the electric-car maker resembles Apple in its early days. "Over the next 10 years, the Model 3's value, in combination with its technology, has the potential to change the world and accelerate the adoption of electric and autonomous vehicles," Munster wrote in a note on July 6. "We believe we will eventually look back at the launch of the Model 3 and compare it to the iPhone, which proved to be the catalyst for the shift to mobile computing." The Model 3 starts at $35,000 and boasts a 215-mile range, placing it in direct competition with the Chevy Bolt. Munster was a senior analyst for Piper Jaffray for 21 years until he left in December to launch Loup Ventures, an early-stage venture-capital fund focused on augmented reality, artificial intelligence, and robotics. Loup Ventures' cost analysis of the Model 3 found that it was more affordable than the Toyota Camry, the fourth-most-popular vehicle in the US, without factoring in tax breaks. "Consensus thinking is the Model 3 expanded Tesla's addressable market from about 1 million cars a year to 4 million cars a year," he wrote. "However, based on our cost of ownership work, we believe the Model 3 expands Tesla's addressable market to about 11m vehicles per year in North America alone." 
The Camry is in a different segment than the Model 3, but Munster said the electric sedan was ultimately cheaper when factoring in the price of fuel, insurance, maintenance, repairs, and technology. That last point is key to Munster's argument. Tesla is collecting data from the tens of thousands of its vehicles already on the road with the aim of advancing its AI to achieve its goal of a Tesla driving itself from Los Angeles to New York by the end of the year. The automaker also plans to launch the Tesla Network, which would allow an owner to temporarily add their car to a self-driving fleet and make money off the vehicle when it's not in use. It will most likely be several years before Tesla's self-driving tech and fleet come to fruition. But the lower cost of the Model 3 combined with the value of Tesla's future tech releases could catapult it to the level of the iPhone, Munster said. It's worth noting, however, that the Model 3 will also cost more than $40,000 when factoring in the price of Tesla's Autopilot software. For Tesla to really tap into the mass market, it would need to double its production capacity this year and again in 2018. The electric-car maker has struggled with production, and it reported light delivery numbers for the second quarter. "Hardware does not scale as easy as software, but it can scale," Munster said. "Looking back at the iPhone in 2007, it was a stretch to envision the company producing 50m phones a year, but in 2015, the company sold 232m units." SEE ALSO: Elon Musk is about to accomplish a goal that was over 10 years in the making
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