Elon Confirms S & X Are Chopped Liver

[BestRadar]

If pricing on the S had remained similar wouldn't they have an even bigger drop in S sales on their hands?

At this level an S seems like a somewhat logical step up for someone who can afford a M3P but isn't in love with the styling or interior, or just likes a bigger car.

I think the sales would have stayed about the same but if they were less they would have still made more margin which would have greatly helped their overall margins. They also removed the lower end battery models on the Model S which is also a mistake in my opinion. There was a market for the Model S with a 70 or 75 battery.

 

[MorrisonHiker]

I think the sales would have stayed about the same but if they were less they would have still made more margin which would have greatly helped their overall margins. They also removed the lower end battery models on the Model S which is also a mistake in my opinion. There was a market for the Model S with a 70 or 75 battery.

They've removed the lower range battery many times over the past few years. I'm sure it will be back in September or December or whenever they need another boost in sales.

 

[twonius]

I think the sales would have stayed about the same but if they were less they would have still made more margin which would have greatly helped their overall margins. They also removed the lower end battery models on the Model S which is also a mistake in my opinion. There was a market for the Model S with a 70 or 75 battery.

I'll trust the marketing people on Tesla for this one.

If you're in the market for an S75D are you really going to pay ~$30k more than a long range dual motor 3?

Maybe the 3 is too cheap?

 

[BestRadar]

I'll trust the marketing people on Tesla for this one.

If you're in the market for an S75D are you really going to pay ~$30k more than a long range dual motor 3?

Maybe the 3 is too cheap?

The Model S is a larger and much nicer looking vehicle in my opinion and I do think there are many people that would pay more for a flagship vehicle. My Model S is coming up on 3 years old in just 3 months and I personally would have bought a new Model S if there was a refreshed version. Its definitely due for a refresh as the interior really has not changed since it was introduced in 2012.

 

[JamesBrown]

If they don’t update the S soon I am out.

What other company leaves their flagship product to rot on the vine? The 3 is not remotely attractive to me. The Y is somewhat better with the hatch but still not compelling enough to get me to bite.

You mean like the Nissan GTR? It is a 6 figure halo car that has had the same engine and design for the past 10 years. They have shown no indication of changing anything either. I can guarantee Nissan cares far more about the Rogue and Sentra than they do the GTR.

BMW even came out last year and openly admitted they dont believe in producing halo cars and have no plans to build one. The CEO openly came out and said "Instead of having one flagship very small, but let's say very highlighted flagship, we would rather have an armada of very fast vessels to attack a broader range of possible customer groups."

MBs G wagon didnt get a redesign for 40 years. No joke, the first generation G-class came out in 1970. The second generation G-class came out in 2019.

Dont even get me started on Cadillac. They have been promising a halo car for 8 years now and still havent even produced renders.

Pretty much all companies focus on their mass produced consumer lines, because that is where the money is. If 80% of your sales come from the Model 3, then 80% of your focus will be on the Model 3.

 

[john85775]

Pretty much all companies focus on their mass produced consumer lines, because that is where the money is. If 80% of your sales come from the Model 3, then 80% of your focus will be on the Model 3.

The car companies that actually make money invest dollars and engineering excellence at the top of the range, then let it drift downwards. Those vehicles become “haloss“ that attract a higher economic buyer to the brand, which provides a pricing premium for the lower end vehicles.

There was a time when tesla was following the strategy, but they appear to have shifted gears. There is now a large gulf between the model 3 and the roadster. It’s almost Chevy-like, but without a profitable truck segment.

 

[Mattzilla]

The S is lacking a huge amount of features compared with its competitors from Germany. Back in 2014 or even 2017 I was willing to accept those lack of features because Tesla had some other features like the giant nav screen, streaming music, phone app and such. Today that's a much harder sell to make as the Germans have caught up in that regard. Tesla has also shot themselves in the foot by getting rid of some of the things that used to make the cars unique, like the bowling alley and the big frunk.

I'm going to be replacing one of our Ss in a year or two and if its the same interior then as it is now, it won't be with another Tesla. I want a better HVAC system, better sound and vibration dampening, auto wipers that actually work, real leather seats that are ventilated, and an interior that looks like it belongs in a $90k car.

According to one of the latest Bjorn videos on YouTube where he tests a Raven, he demonstrates that the noise and vibration dampening have much improved, along with a handful of smaller, little talked about improvements.

 

[Darmie]

I'm excited about purchasing another S. it's the only car that has the highest EPA mileage along with the fastest on the market.

 

[evster]

I think the S need upgraded headlights and rear lights. They can keep the same housing/panels, but just change out the LED signature to a more modern version. One thing that REALLY looks old are the rear lights on the Model S with the ancient dotted LEDs.

 

[tomas]

The expectations he set for S/X were the exact opposite of "too-high." That's the problem.

Point is he is laser focused on future which is 3 Y Pickup Semi and autonomy/ride network. If he doesn’t make most of those happen, he neither lives up to valuation nor fulfills mission. S/X is a low volume car for a limited market with new competition (Audi, jag, etc.) plus overlap for some buyers with 3/Y.

I love the S. I’ve had one since 2012. Thought about replacing with raven. Still might. But I understand that Tesla aspires beyond niche and has to focus on volume.

 

[electricar]

I just love the Roadster narrative - it is going the most fabulous supercar ever: we don't have any to sell now and are making no promises even in Elon Time about when you will get it but send us $50,000 now ( or $250,000 for the Founders Edition ) and we will put you on the list. Hopefully you will, at least, be ahead of the 85 You Tubers who are getting a free one for referring all their " friends ". You couldn't make this stuff up but you could have even more fun buying equivalent amounts of the stock and enjoying that emotional roller coaster. So the Model S and Model X fade away and Tesla produces the Roadster, the Model 3, the Model Y, and a pickup - reminds me of Acura trying to sell the new NSX in a showroom full of RDXs and ILXs. Oh wait, the Master Plan is to use the money made from selling the higher priced models to fund production of the lower priced models so since they already have the money why waste resources actually making the Roadster.

 

[HugoBoss]

S and X will stay on a high-end niche vehicles with low volume. Money is in the other models. Same as BMW and Mercedes, how many 7 series and S class do they really sell? Not that much.

They will eventually get a refresh..... Focus is on upcoming models now

 

[re04586]

Maybe the 3 is too cheap?

Yes, you get so much car for the price, its a steal when comparing to the S.

For those new to Tesla, I imagine it being just confusing to them on why the S cost twice the 3.
"Should I buy the S, or get two 3's, one for myself and spouse?"

 

[twonius]

Yes, you get so much car for the price, its a steal when comparing to the S.

For those new to Tesla, I imagine it being just confusing to them on why the S cost twice the 3.
"Should I buy the S, or get two 3's, one for myself and spouse?"

I mean it sounds crazy even to me but if they'd set the goal post at $40-$45k instead of $35k they'd probably have done a lot better. Volume would've been lower but they also wouldn't have had to build out as much capacity (and a tent) to build 1/2 as many cars.

I guess some would complain that building more cars is helping the planet but even if they get to 500k cars / year that's only about 3% of US sales (and 500k is a global number) .

Drawing in more manufacturers by making cars profitably (as is happening with the S & X) arguably does more to accelerate the transition.

 

[M3BlueGeorgia]

I just listened to the Q2-19 Earnings call and Elon said that he expects S and X to generate around 100K units a year going forwards, and he intends to continue with them.

The high volume vehicles will the the Model 3 with 3/4M and Model Y with 1.5M (his forecast).

I don't see Tesla dropping S and X (or future vehicles in those categories) and I don't know why anyone would read that into the comments on the Earnings call.

 

[re04586]

I mean it sounds crazy even to me but if they'd set the goal post at $40-$45k instead of $35k they'd probably have done a lot better

Agree - but they were stuck with Elon's promise (he actually made good on this one) of a $35k car. I think in hindsight, maybe he would have been better off by not putting a specific dollar amount on the sale price.

You get 90% of the car for 50% of the price when deciding between the 3 and S. When i pitch Tesla to my friends that way, they don't even bother exploring a purchase of the S.

 

[twonius]

Agree - but they were stuck with Elon's promise (he actually made good on this one) of a $35k car. I think in hindsight, maybe he would have been better off by not putting a specific dollar amount on the sale price.

You get 90% of the car for 50% of the price when deciding between the 3 and S. When i pitch Tesla to my friends that way, they don't even bother exploring a purchase of the S.

My really hot take is that the 3 shouldn't exist and they should've just built a $50k Y to start off.

Small sedans are dying in favor of CUVs, so why launch a small sedan?

 

[M3BlueGeorgia]

Agree - but they were stuck with Elon's promise (he actually made good on this one) of a $35k car. I think in hindsight, maybe he would have been better off by not putting a specific dollar amount on the sale price.

You get 90% of the car for 50% of the price when deciding between the 3 and S. When i pitch Tesla to my friends that way, they don't even bother exploring a purchase of the S.

It seems like Tesla cost of manufacturing is trending to maybe have a real live US$35K car early next year. The SR+ is really a $37K car with a mandatory $2K for AP (for total of $39K), and is far superior to the original specs on the $35K car.

So it seems totally viable for Tesla to have a $35K variant (plus mandatory $2K for AP) if they wanted it.

Ex: Cheaper tires, textile upholstery, solid roof, manual adjustment on passenger seat, slightly smaller battery. Combine all those and you can reduce retail price by $2K at constant gross margin. They could also have a different, cheaper door design. All totally achievable, if they ever need a demand boost.

 

[jboy210]

My really hot take is that the 3 shouldn't exist and they should've just built a $50k Y to start off.

Small sedans are dying in favor of CUVs, so why launch a small sedan?

Agree. Not going SUV/CUV first was an error.

 

[twonius]

Agree. Not going SUV/CUV first was an error.

I mean you can like the model 3 while also thinking it was a mistake.

Just ask most of our parents.