Follow up to employee termination

[Product_Guy]

I like fixed prices over bargaining and discounts. Actually, that's an understatement - I truly hate the bargaining game of traditional car dealers. It's not fair and preys on anyone they deem as weak:

http://digitalcommons.law.yale.edu/cgi/viewcontent.cgi?article=2539&context=fss_papers

I thought this was what Elon was trying to avoid with fixed prices. No more games or gender/race discrimination. When you bargain for an item in third world countries, woman are also quoted higher. When we went to buy my wife's BMW, I came home from work, changed out of my suit and tie, and put jeans and a sweatshirt on since I'm convinced the more well-off you look you get quoted higher prices, at least initially until you play hardball back. All that nonsense just to buy a damn vehicle.

But is it worse to say you have fixed prices but then use underhanded tactics to bend (or actually break) that rule? That just breeds ill will by those who paid full price after being told there are no discounts. I'm not saying Tesla is doing this but...



That's difficult to argue with but I am willing to give Tesla the benefit of any doubt at this time while we wait for @Product_Guy to explain these discounts, if he does.

Okay, let me weigh in.

1) I do not work for Tesla. My sole motivation for finding people cars is to get referrals for myself and help people get into a Tesla because I truly love the brand.

2) Tesla does not “discount” cars. The adjust the price based on time, mileage, and condition. The higher the adjustment, the older the car is and the more miles it has. We also see adjustments if the price of a model drops (I.e. the base for a P100D drops by 10k). Inventory cars are not quite going to be new, but are treated as such by tax law etc. Mine had several small imperfections when I got it.

3) Tesla employees are not allowed to post online about adjustments. I have several contacts that I ask to help me find cars for friends and then pass those cars onto the community.

4) if you have any other questions or want help finding a car with an adjustment, PM me.

Best,
T

 

[AnxietyRanger]

Thank you @Product_Guy

Can you walk us through how/why the "Showroom Adjustment" for the inventory cars here is to the tune of $40,000?

End of year inventory deals (HUGE Adjustments)

Because from a lay-person perspective, looking at past quarter customer experiences posted online, the pricing adjustments seem to include the closeness of the end-of-quarter and sales goals related to that, not for example just a mathematical formula on age, mileage and price list changes.

 

[skitown]

 

[Product_Guy]

Thank you @Product_Guy

Can you walk us through how/why the "Showroom Adjustment" for the inventory cars here is to the tune of $40,000?

End of year inventory deals (HUGE Adjustments)

Because from a lay-person perspective, looking at past quarter customer experiences posted online, the pricing adjustments seem to include the closeness of the end-of-quarter and sales goals related to that, not for example just a mathematical formula on age, mileage and price list changes.

They could very well adjust the calculations towards the end of a quarter, but most of the cars with large adjustments have had 5-12k miles on them and are 5xxxx VINs. The age and mileage makes them attractive vehicles for large adjustments. Because of the high mileage, it also probably means that they’ve been holding these cars until the end of a quarter.

If I were guessing, I would bet that going forward, service loaners will be used for most of the quarter and then released at the very end of the quarter. Again, all of this is speculation, but that’s what appears to be happening.

 

[AnxietyRanger]

Thank you @Product_Guy.

 

[Tam]

...
2) Tesla does not “discount” cars...

"Discount" is a reduction.

Why there is a discount depends on many reasons including orphaned cars, used cars, or mass produced technology is now costing less...

By saying "it is not a discount because price is reduced" is just like "it is not a reduction because the price is reduced".

 

[bro1999]

"Discount" is a reduction.

Why there is a discount depends on many reasons including orphaned cars, used cars, or mass produced technology is now costing less...

By saying "it is not a discount because price is reduced" is just like "it is not a reduction because the price is reduced".

I was about to post the same thing.

While Product_Guy states he is not a Tesla employee, he sure posts like a Tesla employee would. Maybe more jedi mind tricks going on, similar to the "adjustment/discount" line being towed.

"I'm not an employee, I'm a sales associate".

 

[AnxietyRanger]

@bro1999 It is also possible @Product_Guy was simply quoting Tesla's preferred wording on the matter.

For whatever reason, it really, really matters to Tesla to avoid the word discount. Similar to claiming they don't advertise.

Both Tesla obviously nowadays does, discounts and advertising. I wish they'd just free their minds and started openly using whatever tactics they need to reach their goals. The smoke and mirrors is IMO more of a PR burden by now, than a PR benefit.

There is nothing wrong with discount campaigns and advetising. Just do it.

 

[RobStark]

@bro1999 Similar to claiming they don't advertise.

Tesla claims they don't do paid advertising. They don't and they don't need to do so.

You do paid advertising to significantly amplify demand. Tesla can't supply much higher demand.

Demand may be short a few thousand units a quarter. Offering good financing terms or increasing value proposition by increasing standard equipment is more than sufficient to increase needed demand.

 

[AnxietyRanger]

Tesla claims they don't do paid advertising. They don't

They do.

You do paid advertising to significantly amplify demand. Tesla can't supply much higher demand.

We'll agree to disagree on this one. IMO Tesla is no longer production constrained, hasn't been for a long time, on Model S/X.

 

[bro1999]

@bro1999 It is also possible @Product_Guy was simply quoting Tesla's preferred wording on the matter.

For whatever reason, it really, really matters to Tesla to avoid the word discount. Similar to claiming they don't advertise.

Both Tesla obviously nowadays does, discounts and advertising. I wish they'd just free their minds and started openly using whatever tactics they need to reach their goals. The smoke and mirrors is IMO more of a PR burden by now, than a PR benefit.

There is nothing wrong with discount campaigns and advetising. Just do it.

Seriously, some simple admission along the lines of, "Yes, occassionaly in order to move unsold inventory that have often been heavily used as service loaners/test drive vehicles that have racked up several thousand miles, we discount such vehicles on a limited basis to move them and make room for newer models."

I mean why is that so hard to do? People who paid full price can go "OK, that $40k discounted car has had god knows how many people abuse it on test drives putting 5-12k miles on the odometer. I still feel fine paying sticker price for an absolutely brand new Tesla". Seems rather stupid to try and maintain this no discounts charade. Tesla has been a publicly traded company for several years now, but they still act like a privately owned company in many ways.

 

[AnxietyRanger]

@bro1999 Yes - and to add one thing: they also have done that to brand new inventory, so including that in the sentence would be necessary as well as perfectly fine.

Tesla paid-advertises inventory, just like they offer discounts on inventory. This combined with aggressive pre-emptive building of new inventory equals a constant discounting and advertising mechanism that is available every quarter. That IMO seems a simple statement of fact by now, with several years of evidence in the open.

Sure, technically they don't advertise and discount custom orders, as far as I know (not sure if they got any paid exposure for the customer-made ads campaign for example), but then they have been moving away from custom orders all the time towards inventory, even simplifying options greatly to make inventory easier to manage and sell... and inventory they discount and advertise.

As for the production constraint, IMO the other marketing campaigns (i.e. referrals, specially designed and timed non-secret "easter eggs", customer-made ads etc.) clearly also suggest the need to drum up and keep up demand, as does falling short of predicted demand during several quarters, and a significant redirection of production to inventory. It is all such a myth by now IMO, that it results in weird side-effects like in this thread/sales associate firing.

IMO better for Tesla to just move into a more mature, normal routine for the sales and marketing of Model S/X. The product is suited for that by now. It is a great product that sells very nicely, there is nothing wrong in openly using discounting and advertising to make it sell some more. Keeping up the old pretense harms more than helps by now IMO.

 

[mongo]

Seriously, some simple admission along the lines of, "Yes, occassionaly in order to move unsold inventory that have often been heavily used as service loaners/test drive vehicles that have racked up several thousand miles, we discount such vehicles on a limited basis to move them and make room for newer models."

I mean why is that so hard to do? People who paid full price can go "OK, that $40k discounted car has had god knows how many people abuse it on test drives putting 5-12k miles on the odometer. I still feel fine paying sticker price for an absolutely brand new Tesla". Seems rather stupid to try and maintain this no discounts charade. Tesla has been a publicly traded company for several years now, but they still act like a privately owned company in many ways.

My $0.02. Tesla works hard to differentiate a per-vehicle price change (based on age/ mileage/ change in option package inclusion) v.s. a per-person price change (based on haggling, relatives, or TMC likes). Wordsmithing for that nuance to the general public is not trivial.
Even your exacting statement can be reported as: Tesla's inventory is up and their latest communication states "we discount such vehicles".

Full disclosure: I bought a Saturn partly due to no-haggling.

 

[Formeremployee]

I want to thank everyone for your insight, kind words, and support.

Just a few days after my post we see massive adjustments on the P100D again. If that news gets out we may have another situation like mine...
The current incentive is similar to the performance model adjustments at the end of 2016. These final days are critical especially with the auto industries typical slow start in the first few months of the year. It's a great time for a new performance model

It's true, employees are not allowed to post deals on the forums which is why I chose direct communication. What's stopping an aggressive sales advisor (or someone thinking outside the box) from creating an account and posting deals as a advocate for the brand? I know an OA that chose that route and ended up at the top of the sales reports for the quarter.

I think consumers would appreciate transparency in the sales process such as receiving inventives directly from Tesla. I know OA's wouldn't mind the extra traffic/sales.

I was ranked as one of the top advisors in my region when I was terminated. We saw what happened to "bottom performers" a few months ago. On one hand we were expected to perform at a high level (Tesla accepts nothing less) and on the other hand you have to limit your reach for fear of something like my situation. That model isn't sustainable long term and I am confident it will improve as the company grows, however, it may require a change in the sales leadership.

 

[AnxietyRanger]

Thank you for sharing @Aaron S. Appreciate it.

I think consumers would appreciate transparency

I think consumers would appreciate transparency in general from Tesla. Period.

 

[bonaire]

They could very well adjust the calculations towards the end of a quarter, but most of the cars with large adjustments have had 5-12k miles on them and are 5xxxx VINs. The age and mileage makes them attractive vehicles for large adjustments. Because of the high mileage, it also probably means that they’ve been holding these cars until the end of a quarter.

If I were guessing, I would bet that going forward, service loaners will be used for most of the quarter and then released at the very end of the quarter. Again, all of this is speculation, but that’s what appears to be happening.

P_G, I have seen some offer 8000-10,000 off with 500 miles on them. Come on. The P-models always offer huge discounts and this is due to being loaners and after a few thousand miles, some discounts of 15k to 20k were seen. Many P90DL of 2016 were built back in March-May 2016 and held for the dump in Q3 for the "pie in the face" quarter. I saw a lot on the east coast with nearly 15 of them, covered in dust, in a lot going nowhere in June just prior to the selling-period of Q3 with aggressive deals. If age is one thing - the aging of the cars was deliberate.

 

[bonaire]

I want to thank everyone for your insight, kind words, and support.

Just a few days after my post we see massive adjustments on the P100D again. If that news gets out we may have another situation like mine...
The current incentive is similar to the performance model adjustments at the end of 2016. These final days are critical especially with the auto industries typical slow start in the first few months of the year. It's a great time for a new performance model

It's true, employees are not allowed to post deals on the forums which is why I chose direct communication. What's stopping an aggressive sales advisor (or someone thinking outside the box) from creating an account and posting deals as a advocate for the brand? I know an OA that chose that route and ended up at the top of the sales reports for the quarter.

I think consumers would appreciate transparency in the sales process such as receiving inventives directly from Tesla. I know OA's wouldn't mind the extra traffic/sales.

I was ranked as one of the top advisors in my region when I was terminated. We saw what happened to "bottom performers" a few months ago. On one hand we were expected to perform at a high level (Tesla accepts nothing less) and on the other hand you have to limit your reach for fear of something like my situation. That model isn't sustainable long term and I am confident it will improve as the company grows, however, it may require a change in the sales leadership.

I think they are keeping things closer to the vest, including inventory lay-out not being put up on the web, but letting stores hold more of the "inventory secrets" close at hand. The inventory aggregators out there made the "showroom discounts" very visible. I think it is becoming more translucent vs. transparent as people wish to see. My expectation is to see trimming of OA and DS employees and making the videos of the Model-3 become "delivery theater" and the cars will generally deliver themselves. This may be the way to cut costs of the Model 3 as production/deliveries ramp up. If Tesla took voice-response systems seriously, you would be able to ask your car "Hey Tesla" and it would ask you what your question is and then reply back with the answer. There is no reason for OA and DS "really". This is the space-age design that I think Elon wants to get to. Robots on the assembly line, autnomous cars to test-drive themselves on the track and park in the lots, drive themselves onto the train and trucks and then self-deliver them at the point of sale. The only thing needed is a detailer to shine them up. And the other guys to buff out the scratches, fix body and suspension alignments and all the other make-good items.

 

[bonaire]

My $0.02. Tesla works hard to differentiate a per-vehicle price change (based on age/ mileage/ change in option package inclusion) v.s. a per-person price change (based on haggling, relatives, or TMC likes). Wordsmithing for that nuance to the general public is not trivial.
Even your exacting statement can be reported as: Tesla's inventory is up and their latest communication states "we discount such vehicles".

Full disclosure: I bought a Saturn partly due to no-haggling.

Turns out - you can go to any car dealer right now and pay sticker price, no haggling. What people are doing is ordering "sticker price" Teslas online - or you can wait until the discounts happen at end of quarters. Take your pick. I don't like haggling but seriously - you don't have to haggle, ever.

 

[mongo]

Turns out - you can go to any car dealer right now and pay sticker price, no haggling. What people are doing is ordering "sticker price" Teslas online - or you can wait until the discounts happen at end of quarters. Take your pick. I don't like haggling but seriously - you don't have to haggle, ever.

I think you knew what my point was... (buying at sticker is not the expected route by either party in a typical dealership, with Saturn it was, with Tesla it is (stickers may vary))

To quote War Games: "A strange game. The only winning move is not to play. How about a nice game of chess?"

 

[AnxietyRanger]

To quote War Games: "A strange game. The only winning move is not to play. How about a nice game of chess?"

And here I thought you were describing Internet forums!