Following the initial formal launch last month of the Model X, the core of Tesla Motors’ engineers and designers have now shifted to the Model 3.

Earlier this week, Chief Technical Officer JB Straubel spoke more about where Tesla’s current – and future – attention is focused.

“Most of the people inside Tesla are no longer working on the S or X, but are hard at work designing and inventing all the technologies going into the Model 3,” Straubel said, addressing an audience at the University of Nevada in Reno recently. His full speech is available at the video below.

To create Tesla’s $35,000-and-up electric sedan, Straubel said the engineers started from the ground up. The requirements of this all-electric car – including its ability to offer a 200-mile range or more for a much lower purchase price – are unique enough that it will not be able to borrow much from the pricier Model S and Model X.

“For better or worse, most of model 3 has to be new,” Straubel explained. “With the X, we were able to build on a lot of common components with the S, but with the Model 3 we can’t do that. We are inventing a whole new platform for Model 3. It’s a new battery architecture, a new motor technology, a brand-new vehicle structure.”

A key element for Tesla to deliver this new sedan at half the cost of its Model S lies in the batteries. Under current prices, Tesla is unable to turn a profit for a car such as this. But the Gigafactory battery plant is expected to cut the per kilowatt-hour of lithium-ion batteries by about 30 percent, allowing the Model 3 to theoretically be both profitable for Tesla and affordable for consumers.

Not commented upon was a disclosure by GM that it is already getting LG Chem cells for as little as $145 per kilowatt-hour, a highly competitive price.

In any case, the first phase of Gigafactory construction was nearing completion over the summer, and Straubel said it’s ready for its first wave of employee to start in the next few weeks. Construction will be a mainstay at the Gigafactory for a while, as Tesla finishes the 10-million square foot facility that’s capable of housing about 6,500 employees.

“We’ll be building this facility out for years and years to come, but our strategy is to do operations in one half even as we continue to expand the other half of the factory,” Straubel explained.

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“A lot of people had the misconception that this is going to be some kind of giant labor pool of people assembling cells,” he added. “This is actually going to be a much more diverse work group. We’re building engineering and R&D teams that are going to operate out of this factory. We already have engineering teams working out of this site – out of construction trailers, but they’re working there.

“And this is going to keep growing. So, we’re hiring production engineers, manufacturing engineers, people that are helping design the control systems and the building itself – the energy systems all the way through materials handlers and human resources.”

When it’s completed, the Gigafactory will be sustainable, powered by renewable resources such as wind, solar and geothermal energy.

The Gigafactory will include “its own ecosystem of people that can run and maintain and support everything that’s going on there,” said Straubel. “It’s not going to be some satellite facility that’s remotely controlled by some headquarters far away.”