The Model Y will be able to go up to 315 miles (507 kilometers) per charge, an increase over Tesla's previous estimate of 280 miles (451 kilometers), according to the letter.
Model Y production in Shanghai will start in 2021. The company also said it plans to start producing limited numbers of its electric semi truck this year.
Tesla also said in the investor letter that it's moving ahead with preparations for a factory near Berlin, and the first deliveries from the factory are expected next year.
Tesla expects net profits going forward, with some possible exceptions at times surrounding the launch of new products.
"We continue to believe our business has grown to the point of being self-funding," the letter said.
Tesla shares have more than tripled in value since May of last year, pushing the company's market value above giant German automaker Volkswagen as well as the combined values of General Motors and Ford.
The electric vehicle and solar panel maker's fourth-quarter revenue grew 2 per cent to $7.38 billion as Tesla delivered about 112,000 vehicles during the period and a record 367,500 for the full year.
Fourth-quarter revenue figures beat Wall Street estimates of $6.99 billion, but net income fell short of the $152.4m expected by analysts polled by FactSet.
Tesla continued to build its cash balance during the fourth quarter, reporting $6.27b available. That's up from $5.34b at the end of the third quarter.
Wedbush analyst Daniel Ives called Tesla's performance "potentially game changing," and a sign of what could be a new era for CEO Elon Musk and the company.
"We would characterise the fundamental performance as impressive with clear momentum looking ahead as a global inflection in EV (electric vehicle) demand appears on the horizon," Ives wrote in a note to investors Wednesday.
Key to future earnings will be production at Tesla's new factory near Shanghai, and demand for electric vehicles in China, the world's largest auto sales market, as well as sales of the mass-market Model 3 in Europe, Ives wrote.
- AP