Tesla Inc.’s (NASDAQ: TSLA) future relies on its ability to mass produce cars for the middle class. It has received regulatory approval to begin to build its Model 3, which will carry a price tag of between $30,000 and $40,000. The company now has the chance to sell several hundreds of thousands of cars a year.

CEO Elon Musk tweeted:

Model 3 passed all regulatory requirements for production two weeks ahead of schedule. Expecting to complete SN1 on Friday.

In a later tweet he said:

Handover party for first 30 customer Model 3’s on the 28th! Production grows exponentially, so Aug should be 100 cars and Sept above 1500.

The waiting list for the car has reached nearly 400,000. Musk expects Tesla’s production levels to hit 500,000 cars a year in the next two years.

Tesla has a market cap of $50 billion, which puts it ahead of Ford Motor Co. (NYSE: F). That makes the success of the Model 3 even more important.

Tesla has had two much more expensive models in the field for some time. The original Model S sedan is priced between $75,000 and over $125,000 for the fastest version. The SUV Model X costs about $100,000.

The race for mass production and mass sales of electric cars is now on. Virtually every large car manufacturer in the world has a large electric car initiative. General Motors Co. (NYSE: GM) has launched the all-electric Chevy Bolt, priced at about $35,000. The Model 3 will compete with this.

Musk has both the approval to build the Model 3 and massive customer demand. Whether he can stay ahead of competition is another matter, one that is also the key to his company’s market valuation and success.

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