AnxietyRanger
Well-Known Member
Yes, they need to maintain/increase S/X sales until 3 is launched and being profitable but I don't see this approach bearing fruit they are hoping for. Maybe I am way off, but I don't see conversion rate of reservation holders swinging to and S in any significant amount. I guess any profit now is better than profit later, but still comes off as short-sighted.
The thing about Model S is, a lot of people have been buying it because it is the only large-battery premium BEV on the market. Some of these people have come from a Prius.
It should not surprise Tesla - and probably does not surprise Tesla, but is a big problem for them still - that as Model 3 draws nearer, this part of their audience is gravitating towards Model 3 instead. It simply is a better large-battery BEV choice for a significant portion of Tesla's current buyers, some of which have been buying upwards of their usual class and size simply because there were no other alternatives.
The natural market for Model S simply is not as large as its selling market has been. Model 3 will correct this abnormality to a large extent, I expect.
In addition, the actual Model X/S crowd, those naturally interested in the cars, may be more subdued as well, because Model 3 signals likely product changes (e.g. 21-70 battery, possibly charging connector, interior, media hardware etc. changes) that might be passed onto Model S/X, not to mention possible upgrades to Model S/X to further differentiate from the Model 3...
Also, Model S/X are starting to show their age a little. Model 3 will look new and fresh next to them and that's a bit of an issue too. What a traditional automotive company would do at this stage is discount the older models, advertise the older models, offer discounted equipment packages etc. to keep them selling... but Tesla doesn't do that stuff, so they "have to" reverse market by anti-selling the Model 3...