Cancelling my reservation

[anticitizen13.7]

Well, damn. That's exactly the sort of degradation of transportation I was talking about. Why do cars have to keep getting bigger as energy use becomes more and more critical to our survival as a civilization? That little 1989 Civic was already a big car for a single person. The Zap Xebra, for all its shortcomings, which were legion, was the perfect size car for me. Even the Teslas, and even when they're run on 100% renewables, would be a lot more green if they were smaller.

If I were emperor of the world, I'd put a hefty tax on all cars by size and weight. Put a big financial disincentive on buying a bigger car than you actually need.

I do expect to love my Model 3, but at half the size it would be perfect for me.

The growth in size of Honda vehicles has pretty much reached its peak. The 8th Generation Honda Accord (2008-2012) was the high water mark of size creep. Since then, the Accord has gotten slightly smaller in exterior dimensions in each successive generation (2013-2017, 2018+), and substantially lighter. Members of the Accord design team decided to make the vehicle smaller after one of the lead engineers had problems parking an 8th Generation in his garage in Ohio.

Why the size creep in the first place? In Honda's case, it was to expand the brand's appeal in America, as many more people started to buy Hondas. Accords in the 80's and early to mid-90's were a bit cramped for taller and larger people. Starting with the 6th Generation Accord in 1998, Honda started making a larger, US/Canada specific Accord, and a smaller different Accord for Japan/EU (One could buy the smaller Accord in the US as the Acura TSX, starting in 2003).

The '89 Civic (4th Generation) was perhaps overkill for a single person, but load up that Civic with 4 people and luggage, and it struggled. I remember that the base trims had something like 75 horsepower. Buyers wanted a car for family trips as well as daily commutes. That pushed both the Accord and Civic to larger sizes and more capable powertrains. Competition between car companies also drove the creep in size, power, and features.

Honda does still make very small automobiles for the Japanese market: Kei cars. I don't think they would sell well in the U.S. though, since the American market demands a car that has a big crash structure and fast highway cruising speed.

I drove the 4th Generation Civic as a teenager and college student. I wouldn't go back to it. The 8th Generation Civic feels unflappably stable in highway flows of 70-80 MPH, and doesn't have punishing cabin noise at that speed. It is also a much safer car in an era of SUVs, thanks to the use of high strength steel, multiple side airbags, and a crash structure that was designed to handle impacts from both high and low cars. The IIHS side impact tests (simulating a hit from a CUV) show dramatic differences in results between cars prior to modern crash structures and side airbags, and cars equipped with those modern features, mostly after 2008 or so. Modern cars have far superior head and torso protection in side impacts from crossovers.

While car sizes aren't going to get dramatically smaller anytime soon, I believe most form factors (compacts, midsize sedans, CUVs) have peaked in dimensions. Cars are getting lighter as manufacturers move to lighter high-strength alloys.

 

[MXWing]

First drive today. There were a few things I'll need to study the manual about, a few thinks I think were mistakes, and a couple of bugs. But overall and un sum, I LOVE IT!!! I'm going to post in the First Drive Reviews thread to avoid derailing this one.

Loving your Model 3 posts here would be insensitive to those who canceled.

 

[AlanSqB]

I'm going to post in the First Drive Reviews thread to avoid derailing this one.

No worries. This thread left the rails about 41 pages ago.

 

[AlanSqB]

Loving your Model 3 posts here would be insensitive to those who canceled.

I’m hanging around waiting for the canceller’s remorse to sit in so pile it on!

 

[mattjs33]

People who are being delayed now have to digest seeing the launch of a roadster into space, and promises made for a new electric semi truck, and a company that will dig tunnels, but somehow Tesla can't produce the $35K 3.

Maybe due to Investing regulations, Elon's hands are tied for explaining the real reason why the 3 is delayed. Was everybody too scared to tell him the battery module was failing? Why was it not noticed in trials?

Because there were no trials. The first Model 3's ever made were delivered at the end of July to company insiders. Remember, Elon is so clever he figured out how to bypass all that validation prototyping.

I look at their production capability. I look at their demand. I look at their -4.03 EPS. It's clear what they need to do to survive. Making your strip model, negative margin Model 3 is not on any person with common sense list of priorities.

Delaying a promise due to inconvenience = Not good.
Delaying a promise due to avoiding suicidal implosion = Rational.

Speaking of investor revolt, I would say that offering a product that you cannot manufacture profitably is irresponsible.

If I tell you I'll have donuts on sale tomorrow for 25 cents, and then you show up that morning to buy them, but I tell you they are actually 99 cents because I determined I can't make a profit at 25, is that me being bad at business or should my customers have known I couldn't possibly have sold donuts for 25 cents?

Tesla would have been better off starting the Model 3 release as a 45K car, and then a couple years later saying we have this new cheaper model on the way if cost has been a barrier to entry for some of you.

 

[MXWing]

Speaking of investor revolt, I would say that offering a product that you cannot manufacture profitably is irresponsible.

If I tell you I'll have donuts on sale tomorrow for 25 cents, and then you show up that morning to buy them, but I tell you they are actually 99 cents because I determined I can't make a profit at 25, is that me being bad at business or should my customers have known I couldn't possibly have sold donuts for 25 cents?

Tesla would have been better off starting the Model 3 release as a 45K car, and then a couple years later saying we have this new cheaper model on the way if cost has been a barrier to entry for some of you.

Cannot manufacture day 1 is not the same as never manufacture.

To be real, Tesla is not yet producing Model 3 in tangible volume even know given demand. But it's getting there.

To your doughnut example - if your doughnuts were not completely unique to you I would say your doughnut business is done for. Most important distinction is it's not a 25 cent donut sold for 99 cents. It's you offering a line of donuts at 25 cents and a line at 99 cents. The 99 cent line is for sale and the 25 cent is not.

Since you have the best doughnuts with amenities that no other doughnut place offers, SOME people will pay the 99 cent price - and they have. Why they do this is the 99 cent donut at your place is better than a 99 cent donut at any other shop.

And it's not simply the fact that a 25 cent donut is beng sold for 99 cents. The 99 cent donut has more sprinkles. It is more aerodynamic and you can roll it across a table faster.

You have marginal benefits - its not a 75 cent dead-weight loss.

Since you sell every doughnut you can make at 99 cents, you are still doing ok. Your problem is if you run out of customers willing to get the special 99 cent doughnuts.

You hope you can produce the 25 cent doughnut line by the time your 99 cent donut customer base is exhausted.

The customer thinks wow this 99 cent doughnut was more than I thought I would spend. Where can I take my 25 or 99 cents and find a better offering than the expensive and delayed Tesla doughnut?

Some things appear to be SpaceX rocket launching difficulty when its really common sense through the lens of an economist.

 

[mattjs33]

To your doughnut example - if your doughnuts were not completely unique to you I would say your doughnut business is done for.

Since you have the best doughnuts with amenities that no other doughnut place offers, people will pay the 99 cent price.

Since you sell every doughnut you can make at 99 cents, you are still doing ok. Your problem is if you run out of customers at the 99 cent price.

You hope you can produce the 25 cent doughnut by the time your 99 cent donut customer base is exhausted.

The customer thinks wow this 99 cent doughnut was more than I thought I would spend. Where can I take my 25 or 99 cents and find a better offering than the expensive and delayed Tesla doughnut?

You are debating with an Economist.

But what if I still had the "25 cent donuts for sale" sign on the front window still? And yet there were no donuts inside for sale at 25 cents? You think someone might have a problem with that?

My ability to make money on the 25 cent donut is not my customers' problem. Just as Tesla's ability to profitably deliver a 35K Model 3 is not Day One reservationists problem. Being told "It's coming after I make some money selling more expensive versions first" will not placate many of them.

I'm a businessman. You need to realize that most consumers are not economists. They want what they've been told they can have, it's not more complicated than that.

The $27,500 Model 3 is a total fantasy. It won't happen 100% while Model 3 is production constrained.

Oh come on man. This is what I said weeks ago and you roasted me for it.

Even if it wasn't production constrained it does not make financial sense for Tesla to sell a car for $35K when they can sell the same car for $70K where they spend almost nothing in component cost between the $35K/$75K version.

By that logic, it makes no sense for GM to sell the Spark when they can sell the CTS for tens of thousands more.

 

[MXWing]

But what if I still had the "25 cent donuts for sale" sign on the front window still? And yet there were no donuts inside for sale at 25 cents? You think someone might have a problem with that?

My ability to make money on the 25 cent donut is not my customers' problem. Just as Tesla's ability to profitably deliver a 35K Model 3 is not Day One reservationists problem. Being told "It's coming after I make some money selling more expensive versions first" will not placate many of them.

I'm a businessman. You need to realize that most consumers are not economists. They want what they've been told they can have, it's not more complicated than that.

You can have a sign advertising 25 cent donuts for sale, people can walk in and ask. You will say they haven't been made yet but would you like a sample of the 99 cent donut? It's not quite 25 cent donuts in stock RIGHT NOW. If you don't have stock of something doesn't mean you can't sell what you have.

It's not misleading to eventually sell something one year from now even if you couldn't deliver it today.

It becomes your problem if Tesla isn't around anymore in 3 years to service your Model 3. Tesla has the option at any time to change what they produce and how they produce it as they see fit. You as a consumer can also decide to buy what you want and what you want at any time. The $1000 deposit is fully refundable at any point in time.

You CAN be mad at Tesla. You CAN throw a tantrum. You CAN swear to 'never buy a Tesla'. You CAN get your deposit back. You CAN buy a Volvo, Jaguar, etc.

You CAN be irrationally angry and upset and refuse to use logic when evaluating business decisions.

Doesn't mean you are right and it's not a crime to be wrong.

Oh come on man. This is what I said weeks ago and you roasted me for it.

Please show me? I'm sure there is a misunderstanding. My messaging is consistent. If not, I will clarify and apologize. Tesla will sell its 200,000 car, like a Model 3 AWD LR PUP for $54,000 before the SR, non PUP shows up for $35,000.

Or the 200,000th car is going to be a $70,000 PM3AWDLRPUP.

It won't be a $35,000 M3 because it doesn't make any sense to not give access to the best incentives for the highest margin/most profitable cars.

By that logic, it makes no sense for GM to sell the Spark when they can sell the CTS for tens of thousands more.

You said you are a businessman right?

If you could ONLY SELL 10,000 cars. Doesn't matter if its a Spark or CTS would you rather:

5,000 CTS
5,000 Spark

or

10,000 CTS
0 Spark

I am interested in disrupting your industry if you make the wrong selection here.

 

[mattjs33]

You can have a sign advertising 25 cent donuts for sale, people can walk in and ask. You will say they haven't been made yet but would you like a sample of the 99 cent donut? It's not quite 25 cent donuts in stock RIGHT NOW. If you don't have stock of something doesn't mean you can't sell what you have.

It's not misleading to eventually sell something one year from now even if you couldn't deliver it today.

The fact that you can't see the problems with this only confirms you've never dealt with the buying public in any capacity, ever in your life. Expecting someone to not have issue with advertising something you won't and cannot sell, except at some undetermined point in the future, is preposterous. Especially when those folks have already put money down for the privilege.

As an economist, your understanding of business is akin to a physicist knowing how to drive a race car. Sure you know how all the forces work, but you've got no idea what it's like out there.

You CAN be mad at Tesla. You CAN throw a tantrum. You CAN swear to 'never buy a Tesla'. You CAN get your deposit back. You CAN buy a Volvo, Jaguar, etc.

You CAN be irrationally angry and upset and refuse to use logic when evaluating business decisions.

Doesn't mean you are right and it's not a crime to be wrong.

I'm not angry at all. And I'm certainly not afraid to be wrong. I've been wrong plenty.

Or the 200,000th car is going to be a $70,000 PM3AWDLRPUP.

Ouch my brain. That's some Harley-Davidson-esque alphabet soup there.

You said you are a businessman right?

If you could ONLY SELL 10,000 cars. Doesn't matter if its a Spark or CTS would you rather:

5,000 CTS
5,000 Spark

or

10,000 CTS
0 Spark

I am interested in disrupting your industry if you make the wrong selection here.

Obviously anybody with a functioning brain would rather sell 10,000 full size SUV's, since automakers have pretty much figured out they can charge any fool price for an SUV and people will rush forward waving money.

But the serious answer to your question is yes, GM would rather sell the 10,000 CTS. The issue is, they've made a decision to enter the 20K-new-car market, in the interest of broadening their customer base, and hopeful those folks will grow up to own another GM vehicle. Tesla however, has made a promise to enter the 35K-new-car market, a promise they seem uninterested in fulfilling, at least while they can still sell 50K cars.

Is it a sound business decision? Yes, absolutely. Is it a bad look? I would say so, yes. That's what led to this thread in the first place.

 

[brkaus]

That's what led to this thread in the first place.

This thread stated with "too many delays, I'm canceling my reservation". It didn't say anything about $35k cars. Heck, it didn't say anything about CTS or Sparks either...

 

[MXWing]

The fact that you can't see the problems with this only confirms you've never dealt with the buying public in any capacity, ever in your life. Expecting someone to not have issue with advertising something you won't and cannot sell, except at some undetermined point in the future, is preposterous. Especially when those folks have already put money down for the privilege.

As an economist, your understanding of business is akin to a physicist knowing how to drive a race car. Sure you know how all the forces work, but you've got no idea what it's like out there.

Few things are black and white and I understand your perspective. I have sold things for as low as $30, and sell contracts for $200,000. I spend a few million each year in capital. I clip coupons for Subway. I hire people for $10, an hour and hire people for $50 an hour.

I understand managing peoples expectations is different along the socioeconomic spectrum. The lower the $ being worked with, the more challenging it is. People paid less and spending less expect more.

I'm going to have to admit I am snippier and snarkier than I should be when discussing this issue. Though that's definitely more so in response to commentary like Elon is a liar. Tesla are liars. They are trying to hold on to my $1,000 for as long as they can interest free. Please, Tesla burns $8,000 per minute. Don't think a few cancellations of $1000 is going to be that substantial to them.

$1,000 should buy you something but not entitlement. It's refundable and a pittance to the overall cost of ownership of even a 35,000 Model 3.

I appreciate your reasonableness.

Those who approached things humbly got the right answer which they should understand or seek to understand - when production is *limited* you have to sell the most expensive car you can.

I'm not angry at all. And I'm certainly not afraid to be wrong. I've been wrong plenty.

Should of clarified I meant the general sentiment of the "cancellation thread".

Ouch my brain. That's some Harley-Davidson-esque alphabet soup there.

Performance Model 3
Long Range Battery
Premium Upgrade Package
Dual Motor
Upgraded Interior
Upgraded Wheels
Upgraded Paint
EAP

When you are in for $50k.. you are in for $60k. When you are in for $60K, you are in for $70K. When you are in for $70K, you are in for service plans. If you are adamant for not being in for 1 penny over $27,500, you are in for $27,500.

Tesla however, has made a promise to enter the 35K-new-car market, a promise they seem uninterested in fulfilling, at least while they can still sell 50K cars.

Is it a sound business decision? Yes, absolutely. Is it a bad look? I would say so, yes. That's what led to this thread in the first place.

Not uninterested, but not capable (for the moment). Two different things. Yes it's a bad look but it's not about good/bad its about right versus wrong.

If people focused more on right/wrong, rational business/irrational business, big picture/small picture, forest/trees they wouldn't be spewing so much vitriol.

No one will be around to service them if Tesla could only sell 1000 Model 3s a month at $35K after burning $8K PER MINUTE.

When its survival/no survival, bad look/good looks are kind of irrelevant. Especially when Tesla is THE ONLY GAME IN TOWN for many aspects of their vehicles.

 

[N5329K]

People paid less and spending less expect more.
This is the perfect distillation of the challenge Tesla will face when they (eventually) produce an actual mass-market vehicle.
Robin

 

[Hank101]

Cancelled reservation, traded 2013 Volt (175,000 miles) in for 2018 Volt, back happy - tons of pressure lifted off of my shoulders. Good to go until realistic options are available. Will jump back in around 2020. Good luck to all, see you then.

Cancelled online last week, $1,000.00 credited back last night.

 

[MXWing]

Cancelled reservation, traded 2013 Volt (175,000 miles) in for 2018 Volt, back happy - tons of pressure lifted off of my shoulders. Good to go until realistic options are available. Will jump back in around 2020. Good luck to all, see you then.

Cancelled online last week, $1,000.00 credited back last night.

Looks like we are swapping Half way through my 2017 Volt Lease which I will upgrade to a Model 3 when the time comes.

Not sure if you know the "baby Tesla" trick on the Volt - but it accelerates a little faster and brake regens more aggressively if you

* Set the gearing from D to L (More aggressive regen and deceleration when off the gas)
* Tap Mode twice - that sets it to sport and gives you more KW for acceleration.

Little known trivia:
You can beat a Model S from 0-30 if you switch to Mountain Mode and engage both the electric and gas engine simultaneously.

 

[FlyingKiwi]

Refund came through to my bank account sometime this afternoon, lost about $50 on exchange rate I think. Will see if there are actually any RHD Model3 SRs available in stock when the Honda finally dies, and how they look compared to whatever the other manufacturers have on the market by then.. so long, and thanks for all the fish!