Maybe I'm not understanding you on this... but I feel like a Model 3 with nearly every option is far better than a base Model S 60, because of everything it will offer including better range. Personally, I wouldn't be able to make an EV work comfortably with 210 miles of range. I'm expecting the Model 3 to offer 300+ miles of range with battery upgrades. One difference might be that I don't really gain any benefit from the larger size of the Model S, and in fact, it will be a negative for me. I prefer a smaller car to begin with.
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Here in Australia the base model VW Golf is $22k. The Golf R is $60k!
I know it's a totally different comparison, but an example nevertheless of the same model (albeit totally different spec) being almost triple the price.
Garlan Garner
Banned
Why do we keep bringing up the MS in this discussion. There are going to be so many things that are different in the M3. EM said it. The first M3 off the production line won't have the same battery as any MS that has been produced. It won't have the same production line process or anything. The MS is not the competition for the M3. Neither was the MS competition for the roadster. They are 2 totally different cars.
I believe we can compare the MS and MX but neither of them against the roadster. BMW doesn't compare their 3 line to the 7 line. They are two tonally different cars that happen to be made by the same Auto Maker.
Garlan Garner
Banned
I understand the comparison between the Golf's and it makes sense. I just can't see that if the base price of the M3 is $35K that there could be that many more options to get it to $90K.
Garlan Garner
Banned
The problem - good problem with current Tesla cars is that they perform so well. The MS has been compared cars from the Chevy Impalla in size to a Lamborghini on the track. From a Volvo in safety to a Bugatti in handling. From a $21K car to a $2.6Million dollar car. And the MS has not only held its own in these classes but in many many cases surpassed its competition. The MS's competition spans many car classes and its difficult to anchor down where the MS really belongs because it just about beats everything in safety and speed and technology and......
The M3 is going to be no different than the MS in its class of cars. However I believe that the M3 is NOT going to surpass its competition in the following area - Price. That's what I believe is going to put the M3 on the top shelf of its class. It will be a mass produced affordable car that when optioned out will also be #1 in its class. Not comparable, but by far #1 in its class.
I believe that the M3 will be priced for what it is. Unlike the MS which had M3 development money built into it. I don't believe the Tesla Truck will be funded out of the M3. I don't believe AP 40.0 will be funded out of the M3. Nor anything else.
I believe the M3 will be Teslas first WYSIWYG car - or better yet - coining my newly created acronym WYPIWYG. What-you-payfor-is-what-you-get.
The M3 is going to be no different than the MS in its class of cars. However I believe that the M3 is NOT going to surpass its competition in the following area - Price. That's what I believe is going to put the M3 on the top shelf of its class. It will be a mass produced affordable car that when optioned out will also be #1 in its class. Not comparable, but by far #1 in its class.
I believe that the M3 will be priced for what it is. Unlike the MS which had M3 development money built into it. I don't believe the Tesla Truck will be funded out of the M3. I don't believe AP 40.0 will be funded out of the M3. Nor anything else.
I believe the M3 will be Teslas first WYSIWYG car - or better yet - coining my newly created acronym WYPIWYG. What-you-payfor-is-what-you-get.
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I agree. I realize now my wording was confusing. We were discussing what the fully optioned price will be, and I was trying to say that I don't think the fully optioned Model 3 will be the same price as a base Model S, I think the Model 3 will be more expensive for the reasons you listed.
N5329K
Active Member
The BMW 3 series has always been the Model 3's benchmark in the "entry-level luxury sedan" segment. I would expect Tesla's numbers to add up to something like a maxed-out 32X's. Say, between 2X and 3X the base price.
Robin
Robin
Dan43
Member
Has anyone thought about what those options will be? AutoPilot, new seats, battery ranges and speed ranges, paint, sunroof, etc etc.
and random not yet stuff say AP 3.0, HUD displays, etc etc etc.....
and random not yet stuff say AP 3.0, HUD displays, etc etc etc.....
Garlan Garner
Banned
I don't believe it will. I believe the M3 will crush the BMW price. I'm expecting at least $15k - $20K reduction in price. There will be no reason to buy a BMW M3 ICE.
You don't beat your competition by matching your competition.
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Garlan Garner
Banned
Excellent question. We must think.
There really aren't a lot of options on Teslas. Which is absolutely fantastic.
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With all after market options-I'll guess 110k.
Like a Porsche 911 turbo-you can get one for 119k-but get a ruff-now you're talking about 278k.
Big difference in getting all those 3rd party cow bells. lights bouncing suspension, modified engines (motors in our case), changing body panels with fiberglass-something I might do with my model 3-like a tricked out tri bike.
If you're talking about straight out of the factory-80k probably.
Like a Porsche 911 turbo-you can get one for 119k-but get a ruff-now you're talking about 278k.
Big difference in getting all those 3rd party cow bells. lights bouncing suspension, modified engines (motors in our case), changing body panels with fiberglass-something I might do with my model 3-like a tricked out tri bike.
If you're talking about straight out of the factory-80k probably.
Nor do you beat a premium competitor by pricing lower.In premium products from smartphones to clothing to perfumes to cars, price is part of the luxury value proposition. That is precisely why several everyone from VW (think Seat, Skoda, Aud) has effectively identical models for each of thee brands that have different pricing and positioning but no fundamental difference. We can see Toyota/Lexus, Nissan/Infiniti, Hyundai/KIA and many others. Maybe the definitive example should be the Toyota IQ and Aston Martin Cygnet although that one did not work out so well except in the aftermarket.
Tesla will not leave any money on the table vs any remotely similar BMW. They already don't. Check out Model S pricing vs similar BMW 7 series.
Garlan Garner
Banned
Oh yes you do beat a premium competitor when you start talking about prices in the $35k - $50k range. I've not heard of many people walking into dealerships saying "I don't care about the price" I just want my options on my $35k car. <------- read that carefully
Rich people don't care as much and as often about price as those in the middle or lower income group. That's an absolute fact. And the M3 is going to attract and target that middle an lower income group. That's one of the primary reasons why I suggest that people stop comparing the MS and the M3 is for this very reason. People who drop $140k - $150k on a car - think differently than those who scrape together $35k on a car. A Lease for a fully optioned MX is approx. $2,200 per month. A lot of the people who will scrape to get a M3 have a total monthly budget of $2,200 for their entire household. $2,200 is a mortgage payment for a pretty nice home these days. How many BMW 7 series are out there compared to the 3 series. Why? Price The prius and the leaf are selling because of price...not because they are beautiful or have a great 0-60 time or have a ton of options.
People who scrape by to get a $35k car - are looking at price a lot more carefully than they would with a $150k car. You are talking about a whole different people group with a totally different mental selection process. After reading thousands of posts here in this forum I have noticed a large majority of M3 reservations stating that they are starting up $10 per week savings accounts and such to have at least "something" to put down on their M3. To them I say - I'm pulling for ya. Keep it up and stay encouraged. Don't give up - one day it will pay off when your M3 is in your driveway.
Neither group is better or worse than the other. Its totally a matter of affluence or not.
Read my words carefully before you bash me in a reply.
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Economies of scale will certainly help, but anybody with a background in manufacturing knows that while prices decrease with increased volume, they do not decrease to anywhere near 50% cost. You're looking at 75% cost max (or min?). Probably more like 80-90%.
Tens of thousands compared to hundreds of thousands sounds like a lot, but it's really not. Tens of thousands to millions? Now we're getting somewhere.
I would not bash you for a thoughtful, well reasoned post. In fact I quite agree with your logic, especially the part about wanting all the goofies but not wanting to pay the price. There is no coincidence that posted base price rises the percentage of cash buyers and lessees also rises. Also the tenor of loans and leases lengthens as the base price reduces, except at the very bottom. The reason is that people buying entry level luxury cars are bi-modal. One mode is people who could afford a more expensive car but choose as less expensive one. They are most of the entry level cash buyers. The others typically buy a more expensive car than they planned and deal with it by having a longer tenor for lease or loan.
Luckily that last fact might just not happen with Tesla because the absence of commission-based F&I and salespeople reduces the incentive to oversell. Frankly I really hope it works that way. The traditional practice infuriates me.
As an aside: dealer-sold extended warranties are typically marked up at least 100%, dealer-installed options are similarly rip-offs and loans have markups of >200 basis points, while leases are their Holy Grail because they can hit money factor, residual value and adds without the customer seeing it. Abi e all the dealer needs the lease to go above $25,000 so they can evade cnsumer disclosures.
Sadly, I kniw these practices all too well, but I cannot be proud of it since I helped design a good many such products.
Finally, the Tesla model makes the base a very nice car, and nobody pushes an upsell. The recent heavy promotion of S75 to people who were ordering S60 makes me a trifle nervous, but it is a transparently good deal for buyers, so I'm swallowing my innate opposition to typical upgrade tactics.
Maybe the larger issue at the moment might not be absolute scale but option mix. Tesla has done a great job of adding high-perceived-value upgrades, so if they can keep the option mix fir the 3 in a similar proportion that they now have with S and X they'll do very well even if the pure base 3 will have narrow margins. The base S60 optionless probably has very low margins today. Luckily for Tesla nit yo many people actually buy a pure base model.
Not sure how they do contracts in car manufacturing because I thought we expect to have 500K 2018 and 1 Mil after that.
Canuck
Well-Known Member
Tesla has so much debt to repay, and wants to one day build up cash reserves like Apple, it seems to me to be foolish to think savings from economies of scale will go to the consumer. In my opinion, savings will come because competitors force them to, or low demand requires it, and not by economies of scale.
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