July 11, 2017 / 1:14 PM / a month ago

Tesla steps up auto service as Model 3 debut nears

First production model of Tesla Model 3 out the assembly line in Fremont, California , U.S. is seen in this undated handout photo from Tesla Motors obtained by Reuters July 10, 2017. Tesla Motors/Handout via REUTERS

SAN FRANCISCO (Reuters) - Tesla Inc said it is expanding its auto service centers and adding 350 mobile service vans as it gears up to support its Model 3 sedan, a mass-market car that is expected to drive a 500 percent increase in the electric car company's sales.

A senior executive speaking on behalf of the company told Reuters that Tesla would be able to triple its global service capacity by increasing efficiency, adding to mobile service, and adding 100 service centers to its current total of more than 150.

Tesla is adding 1,400 technicians this year, and the company plans to continue expanding mobile and service center capacity at a similar pace over then next few years.

Tesla needs to expand service quickly to be able to handle the increase in sales and as the electric car company transforms itself from a luxury vehicle maker into a competitor with mainstream cars.

Expectations for a smooth roll out are particularly high among investors. Tesla has been challenging General Motors for the title of biggest U.S. automaker by market capitalization, even though its output is a fraction of GM's.

The $35,000 Model 3 is designed for easy production, creating lower service needs, the executive said.

Tesla's last launch was the Model X SUV in 2015, which had a number of production issues.

Model 3 production began in the last few days and is expected to reach 20,000 per month in December. The first deliveries are expected on July 28.

Tesla had fielded 373,000 Model 3 reservations as of April 2016, the latest date at which it announced a figure.

The company has learned from previous problems including issues with seatbelt latches, seats and a 53,000-vehicle parking brake recall earlier this year, the executive said.

Tesla said it has improved service time by automating paperwork, using cars' wireless connections to diagnose problems, and expanding mobile support.

Tesla deployed mobile vans to company charging stations to fix the seatbelt latch and cut the procedure to less than 20 minutes.

About 80 percent of fixes on its vehicles do not require a lift and can be done by one of its mobile technicians, which frequently can handle an appointment in less than an hour.

Reporting By Marc Vartabedian Editing by Peter Henderson

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