Musk also confirmed the car, which is billed as a smaller and more affordable alternative to Tesla’s existing feet, will be priced at $35,000 (£22,900).
The reason for the hiatus is that Tesla are in the process of constructing a vast new $5 billion “Gigafactory” in the Nevada desert, where the Model 3 is to be produced. The facility’s increased battery production capacity will allow Tesla to cut production costs.
First teased in July las year, details about the Model 3 have been scarce. In terms of its appearance, Musk recently said it would be "way different from any other car on the road".
The current Model S has been extremely popular but with prices beginning at $71,000 (£46,500), it has proved too expensive for the average consumer. Model 3 will mark Tesla’s first foray into mass-market cars.
Pre-orders for the Model 3 are due to open in March 2016.
Tesla Motors was founded in California in 2003 by business magnate, investor and inventor Elon Musk. Earlier this year the compan revealed they may be close to unveiling their own version of an autonomous car.