TMC is an independent, primarily volunteer organization that relies on ad revenue to cover its operating costs. Please consider whitelisting TMC on your ad blocker or making a Paypal contribution here: paypal.me/SupportTMC

Generating Model S sales through Model 3 Reservations

Discussion in 'Model S' started by henderrj, Feb 27, 2016.

  1. henderrj

    henderrj Member

    Joined:
    Jun 16, 2014
    Messages:
    74
    Location:
    Graham, WA, United States
    Given that many people, who could afford to do so, do not buy a Model S due to a visceral rejection of any display of luxury, and given that they will be enticed to order a Model 3, could a large portion of these people be lured into a temporary purchase of a Model S while waiting for the 3 to make its appearance?

    We’ve all met the "millionaires driving Priuses" group. I agree with those that think this market is many times the size of those who would purchase a Model S. Thus Model 3 reservations will, I am certain, exceed 150,000 in the first few months and continue to grow continuously through its release in 2017. I believe I may have an idea that can convert these reservations into Model S/X purchases.

    When the orders are in place Tesla sends out a letter reiterating what we have all known for years – the Roadster and S/X were always meant to develop the capital necessary to produce the 3. “You can help us run the final mile of our mission, avoiding further investment or loans, by purchasing …” Well, you already know the rest. Thus Tesla appeals to their altruistic nature and perhaps can offer them something additional.

    What if Tesla adapted their current trade in value guarantee to a slightly higher percentage if it is used to convert their Model 3 reservation to an order?

    Benefits to the consumer:
    · Let’s them be a part of the sustainable transportation mission now.
    · Gives them a reasonable explanation as to why they bought a luxury car.
    · Allows them to reduce their carbon footprint instantly.
    · Allows them to return to their more comfortable position vis-à-vis the automobile in two to four years with minimal cost.
    · Let’s them enjoy life more now!

    Benefits to Tesla:
    · Increases S/X sales now reducing need for external capital.
    · Increases the mass of sustainable transport evangelists.
    · Does the same as to Tesla enthusiasts.
    · Potentially increases total lifetime sales to any given customer as many may choose to keep their “old” Model S/X and simply add the Model 3 to the stable.

    Benefits to me (in the spirit of full disclosure):
    · I’d like to have two minutes of Elon’s time – I have an idea (patent pending) that I think is the last piece needed to make sustainable transport palatable to the masses. If I can’t entice him in two minutes then I’m probably wrong. But it would still be great to shake his hand!

    I have personally talked with a number of people on the edge of buying an S who would be pushed over with this approach. It might be wise of Tesla to wait a few months to offer this option. Especially as the first full year of production will likely be preordered within 30 days. Six months from now it’s going to be a four year wait. What do you think? Am I out of my mind, or maybe on to something here? What negatives have I missed? Are there other positives? Some of the greatest “group think” happens here – so, let me have it!

    Rick
     
  2. SmartElectric

    SmartElectric Active Member

    Joined:
    Jul 9, 2014
    Messages:
    1,078
    Location:
    Toronto,Canada
    +1 I like the idea.

    We bought our CPO Model S last year, never believing we would spend this much on a car. But the benefits of ownership are amazing. We were drawn into EV's with our Smart Electric Drive. My wife became attached to it, preferring it to her Mercedes. I just couldn't wait for the Model 3, and life is too short. I'll bet Tesla could convert a fair number of reservations of 3 to S or even CPO if they cared to. That said, the S and X do not look to be demand constrained any time soon...
     
  3. henderrj

    henderrj Member

    Joined:
    Jun 16, 2014
    Messages:
    74
    Location:
    Graham, WA, United States
    I really like the idea of using the CPO program. This would bring the price levels even closer to parity. With a major facelift to the S coming soon (many of the X components, for sure) there may be another raft of tradeins. Good thought SmartElectric!
     
  4. eye.surgeon

    eye.surgeon Member

    Joined:
    Nov 18, 2014
    Messages:
    707
    Location:
    California
    There won't be a major facelift of the Model S until the M3 is in production.
     
  5. twonius

    twonius Member

    Joined:
    Feb 28, 2016
    Messages:
    153
    Location:
    San Diego CA
    Considering the big shakeup in the CPO inventory my guess is they'll try to convert Model 3 depositors into CPO buyers. It'll be a while before they get their cars and need to drive something in the mean time. This also will help support used Model S values as the "baby boom" of 2013-2014 cars come off lease.
     
  6. SmartElectric

    SmartElectric Active Member

    Joined:
    Jul 9, 2014
    Messages:
    1,078
    Location:
    Toronto,Canada
    Tesla was producing cars for US+CAN sale at a rate of a ~1000 per month in 2013, and ~1500 per month in 2014.
    The leasing program began in Apr 2013, a time when European cars were beginning to drive a larger percentage of sales.
    Auto pilot hardware was only available later in 2014, so most lease+resale-value-guarantee returns in 2016 will be "classic" Model S's.

    These details do not add up to a "challenge" in my mind, as the lease return inventory in US+CAN doesn't really built up until later this year, well after Model 3 reveal.
     

Share This Page