As Tesla's (TSLA 2.61%) first quarter comes to a close next week, investors are preparing for the electric-car maker's quarterly update on vehicle deliveries and production.

Regarding vehicle deliveries, investors are likely expecting around 25,000 Model S and X deliveries (consistent with guidance for Model S and X annual deliveries to remain on par with last year's shipments) and a significant jump in Model 3 deliveries. But investors will likely mostly be concerned with the Model 3 production ramp-up progress. With hundreds of thousands of deposit-backed reservations for the vehicle, investors will look for Tesla to maintain its aggressive production targets for the important vehicle.

Specifically, investors are likely hoping to have one big question answered when Tesla updates investors on first-quarter deliveries and production: Is Tesla still on track to achieve a production rate of 5,000 Model 3 units per week by the end of the second quarter?

Tesla sub-assembly at the Fremont Factory

Tesla factory. Image source: author.

Ramping up production

After whiffing on its Model 3 production targets twice, investors have been looking closely for signs that Model 3 production is ramping up quickly in 2018. Bloomberg even created a Model 3 tracker, where it estimates Tesla's weekly production rate.

Investors will hopefully get some concrete answers on how Model 3 production is faring shortly after the first quarter ends. Tesla provides updates on deliveries and production within the first three days of each quarter's close. With Q1 closing at the end of this month, investors will get an update by April 3.

The near-term Model 3 production target for investors to watch is Tesla's aim to achieve a weekly production rate of 2,500 units per week by the end of Q1. Achieving this would mark Tesla's fastest production ramp-up by far for a new vehicle.

But what will arguably be even more telling about Tesla's progress with Model 3 production will be an update on whether Tesla is still aiming to achieve a Model 3 production rate of 5,000 units per week. Going from producing 2,500 Model 3 units per week at the end of Q1 to 5,000 units per week at the end of Q2 would be an extraordinary achievement.

A woman unlocks her Model 3 with a Tesla app on her smartphone

Model 3. Image source: Tesla.

Proving its market capitalization

If Tesla really is still on track to hit its production rate of 5,000 Model 3 units per week by the end of Q2, it's going to become increasingly difficult for skeptics to discount the possibility of Tesla becoming a high-volume auto manufacturer.

A production rate of 5,000 units a week would mark a significant jump from the approximately 2,000 units per week Tesla averaged last year for its Model S and X combined. For perspective, a weekly production rate of 5,000 units per week translates to an annualized run rate of 260,000 units -- far higher than the 103,000 vehicles Tesla delivered in 2017.

Of course, even if Tesla says it's still on track with this aggressive target, Tesla shareholders shouldn't get too excited. The company's market capitalization of more than $52 billion already prices in breakneck growth in the coming years.