How Tesla Managed to Alienate Their Most Loyal Customers

[bonnie]

The Alsop incident deeply troubled me. I don't think Elon should have cancelled his order. I don't want to defend Alsop because I think his blog post crossed the line and I don't know what happened in the phone, but in some ways he represented a group of frustrated X reservation holders (however large or small they might be). And Elon cancelling his reservation comes across as Elon being clueless as to the frustration many X reservation holders are feeling.

Having had to recently fire a customer, I didn't take it that way. I guess we all filter things through how we are feeling in other areas of our life. And I'm sorry you're feeling this way, Dave.

I did see that somehow you were somehow left off the invite for the Model X drive events in your area and that was inexcusable. I'm sure that was the last straw for you. You should have been first on that list.

 

[MikeL]

... and I don't want people to go through again with Model 3.

Ultimately THAT is the point. I just compose sentences so slowly that I quit before I got there. :smile:
& for those of you with LOTs of free time, check out DaveT's posts. He's no slouch. I mostly joke around. It is my experience that he, on the other hand, is somewhat more on the serious side. Lord knows I appreciate those folks!

 

[MikeL]

Hahahaha while I've been here - my Model X order changed to : "has entered the production cue"
all together now ... " 'bout time!"
So NOW it would be nice if TSLA would gain a little momentum. It has always moved on news. The Model 3 reveal will be news indeed!

 

[Cattledog]

Dave - Thanks for the honesty. For newbies here, Dave's always been about honesty and also a huge net giver to the Tesla community (unlike MikeL and I who are net takers = leeches - sorry to out you Mike!) If you've invested in Tesla, take the time to subscribe to Dave's almost weekly newsletter - Tesla Weekly, Tesla Weekly. Or follow his link to his old Megaposts Articles/megaposts by DaveT,. Or dig up the google chats heled after earnings calls (are those archived). All great stuff, all time Dave shares with us for nothing. So for people who are new, Dave may come of as a complainer, but when one of Tesla's TOP FIVE fans is frustrated, they should take heed. Not as eloquent or as smart as Dave, I've loved owning the cars, the stock, being on this forum going to TMC Connect, etc. Like Dave, I am relentlessly positive about Tesla, but like Dave I have been frustrated by things they've done. This is the last Model that should get to use 'growing pains' as an explanation for issues.

I think Tesla brings such an 'A' game for vision, engineering, design, innovation, etc. that when there's a part of the company that just got a 68 on the Communications final and followed in with a 65 in Marketing 101, it really stands out. I think Dave would agree that way, way more than any personal frustrations we have or anyone has, we want to see them succeed fantastically. To do that, they need to bring all aspects of the business to the same level, in about 2 years.

 

[Quant]

Dave - Thanks for the honesty. For newbies here, Dave's always been about honesty and also a huge net giver to the Tesla community (unlike MikeL and I who are net takers = leeches - sorry to out you Mike!) If you've invested in Tesla, take the time to subscribe to Dave's almost weekly newsletter - Tesla Weekly, Tesla Weekly. Or follow his link to his old Megaposts Articles/megaposts by DaveT,. Or dig up the google chats heled after earnings calls (are those archived). All great stuff, all time Dave shares with us for nothing. So for people who are new, Dave may come of as a complainer, but when one of Tesla's TOP FIVE fans is frustrated, they should take heed. Not as eloquent or as smart as Dave, I've loved owning the cars, the stock, being on this forum going to TMC Connect, etc. Like Dave, I am relentlessly positive about Tesla, but like Dave I have been frustrated by things they've done. This is the last Model that should get to use 'growing pains' as an explanation for issues.

I think Tesla brings such an 'A' game for vision, engineering, design, innovation, etc. that when there's a part of the company that just got a 68 on the Communications final and followed in with a 65 in Marketing 101, it really stands out. I think Dave would agree that way, way more than any personal frustrations we have or anyone has, we want to see them succeed fantastically. To do that, they need to bring all aspects of the business to the same level, in about 2 years.

The way life works, and the way business / organizations work is that you are only worth what you are today. That's why CEO's , managers, analysts etc who may have been good in the past and then make fundamental errors are moved or let go.

Many really good people sometimes go through mental, financial or personality/ personal challenges and that colors their view.

At this point, I am not naive enough to subscribe to any newsletter or BS stuff from people who can't see beyond short term problems and challenges. These folks , in my opinion, will only lead you down the wrong path. Fwiw ....YMMV.

 

[MikeL]

I'm gonna think of myself as more of a "getter" Ha! Semantics

 

[DaveT]

Having had to recently fire a customer, I didn't take it that way. I guess we all filter things through how we are feeling in other areas of our life. And I'm sorry you're feeling this way, Dave.

I did see that somehow you were somehow left off the invite for the Model X drive events in your area and that was inexcusable. I'm sure that was the last straw for you. You should have been first on that list.

I can relate to Alsop in some ways because I had a troubling experience at the Model X launch. It was by far the worst-run Tesla event I've ever been to (and I've been to almost every single one over the past few years). People were squished like sardines and told to stand for a ridiculous long time as the event started almost an hour late. Elon comes up and makes no apology. And this is after I had to see my friend's 8-month-pregnant wife stand/sit on the ground for 2 hours. The least Elon could have done was to apologize. But anyway, I'll give him the benefit of the doubt. He's probably under a huge amount of stress, press conference probably went over, etc.

After the event I'm trying to get a test ride in an X but they have so few on hand (i.e., maybe 5). And the line is moving so painfully slow that the vast majority of people have no chance of getting a ride.

I talk to one of the main managers for the event, a Tesla employee (who will remain anonymous here but who holds a decently high position). I share my concerns about the late start and lack of test ride cars, and give some suggestions. I end up talking to her for about 10 minutes and the whole time she's brushing me off. Regarding the late start, she basically says "Elon can do whatever he wants. If he wants to start late, then who are you to tell him he can't?"

I've thought about her response since. And it got me concerned that a person like that (ie, low empathetic) would be in such a high position. And then it also got me thinking how many "yes" men/women are surrounding Elon. Who's going to go to him and tell him, "Elon, we're screwing up the X rollout. Our customers are angry."? I'm thinking maybe nobody's telling him that. And that's why Alsop's blog posts surprise him somewhat. And Alsop's frustrated because he thinks he needs to get the message across to Elon. But Elon doesn't think any of it is true and thinks he's just a bad customer.

I've had about 5-10 encounters with Tesla employees this past year where I've felt a disconnect, like the employees where in their own "Tesla is great and can do no wrong" world. Any complaints get brushed off as "we're trying our best". I know this is not true of all Tesla employees because I've met plenty that are very empathetic. But it's just concerning that my experience is so mixed.

Anyway, I think Elon doesn't have a clue that so many X reservation holders have had such a poor and frustrating experience. If he did, I think he'd try to change it.

 

[DaveT]

I think Tesla brings such an 'A' game for vision, engineering, design, innovation, etc. that when there's a part of the company that just got a 68 on the Communications final and followed in with a 65 in Marketing 101, it really stands out. I think Dave would agree that way, way more than any personal frustrations we have or anyone has, we want to see them succeed fantastically. To do that, they need to bring all aspects of the business to the same level, in about 2 years.

100% agree.

 

[WarpedOne]

People should just grow up, there is time for ferries and there is time for understanding.

 

[omarsultan]

Always a fan of transparency, but most of this post comes off as a cranky rant--perhaps justified, but some reasonable points got lost in the noise.

Transparency is a tricky thing in a publicly traded company--what gets disclosed and who it gets disclosed needs to be handled with care, especially with material info like the production numbers on the MX. In terms of disclosure, they did warn on the Q3 earnings call that they were having supplier issues and the ramp on the MX in Q4 was uncertain but they expected to recover in Q1. IIRC, they also hinted at this in the Q2 earnings call and provided a fuller explanation in the Q4/FY call. At each call, I believe they shared the best info they had.

 

[Auzie]

Dave I am really sorry that you feel let down by Tesla.

My take on your post is that perhaps your expectations in respect of Tesla do not match reality and that may lead to disappointment.


Some examples, your bullet points:

1. You expect and ask for ultra transparency regarding future production numbers. I highly doubt Tesla will ever be ultra transparent and will share specifics on how many cars they will produce and when, and when people can expect to receive their cars. This is asking Tesla to be ultra precise regarding future. That is just not possible for rapidly growing business. Any such attempts at precise projections are bound to be wrong and to bite Tesla back.


2. You expect Tesla to share the reasons for delays. I highly doubt they will always do that. They might, they might not, whatever works for them, but often it might not be appropriate to share for various business/legal reasons.


3. You expect continual communication and openness with Model 3 customers, (hundreds of) thousands of people. Sometimes revealing too much just invites customers venting and vile reactions. It is quite difficult to do a daily job and to manage a wide range of customers and expectations.


4. Your expectations: head roll in case of delays - I am sure Tesla deals with the delays appropriately and in a measured way. There were examples of suppliers and executives parting ways with Tesla due to subpar performance. More often than not these partings are not publicized as publicity may be inappropriate or not legal in some cases.


Regarding taking a deposit and not communicating the way some people desire, Tesla is setting the terms of the deal and it is obvious that one of the terms of the deal is not over communicating on micro/personal level, for whatever reason that might be. These terms can be changed if and when there is competition with better terms.


Regarding stock price, perhaps it is where it needs to be at the moment. My expectation for Tesla is that if they manage to stay going concern, I do not worry too much about share price. The market will value it right.

When macro conditions improve, all stocks will go up and so will Tesla, more than other stocks.

 

[PaulusdB]

You suggest a highly valid explanation for the current - less than optimal - behavour of Tesla Motors.
E.g. the sudden elimination of Mr. Guillen fits that picture. Thank you for this insight.
(Not to mention reduced service conditions and overstated HP and kWh.)

...And then it also got me thinking how many "yes" men/women are surrounding Elon. Who's going to go to him and tell him, "..."? ...

 

[schonelucht]

While we are on the subject of alienating their most loyal customers, how about they stop putting out specifications that nearly always need at least two asterisks? It started right from the very first sentence of the model S reveal which was supposedly a "300 mile car under $50k" Turned out that it was, but never both at the same time, and then of course only after the incentives. It continued with messaging the price in ever more convoluted ways (after incentives, after fuel savings,...), the protocols under which 0-60 times being reported changing from one model to the other to make the gap between both seemingly larger than it was. Same of course with the famous horsepower stuff and finally we are learning that even the main badging numbers (60-85) were not indicative of relative battery capacity between both models.

Those kind of statements where I, as a customer, can't take the company at face value without examining every little possible interpretation nuance? That sounds to me like an old fashioned second hand car sales guy who's giving me a hard sell on his financing deals.

Tesla should just stop that altogether. The product is amazing enough that even if they reported every single spec as an understatement with the least favorable measurement protocol it would still be the best car money can buy.

Unfortunately I suspect that the Model 3 reveal will start with Elon saying it's going to be "a $35k car with the best autopilot money can buy". And then it will turn out that yes the Model 3 will be that, but not both at the same time. And what will happen is that many of the loyal fans who laid down their $1k because they can stretch their budget to $35k for an amazing car are going to look at what they actually get at that price and then cancel. It won't be a problem because the $45k model will still sell like hotcakes, the $35k model will be scrapped after 6 months because 'no one is buying' (sounds familiar?) and another notch up the list of Tesla statements we can squarely put in the camp of : "technically true but that's about it".

 

[houdini]

Seriously pointless rant given you prove the point by your actions. You own a model S have ordered an X and you aren't cancelling anytime soon. Why would Tesla change a thing? They can do whatever they want and you, Dave, will still buy. Why would they change? I wouldn't. Do what you like, start late, treat customers whatever way you want and they still line up to buy whatever you produce. I'd almost be tempted to play a game and keep going to see how bad you could be and still people will buy anything at almost any cost. I half joke. Save your breath, Tesla doesn't have to change anything and if a customer walks 20 more will take their place.

- - - Updated - - -

Since You show a reflexive behavior of personally attacking posters stating obvious facts, it makes me wonder if You work for Tesla.
You lack the basic manners.

It´s 2016 now and Tesla is still stuck PR wise in 2012.
Tables are turning and it´s time for them to step up their game.

Why exactly? They're selling as many cars as they can make, have pre-orders for thousand more, will sell tens of thousands of model 3s years before they even make them.....
Why should they change again?

 

[AlMc]

I see nothing wrong with DaveT's points. I have been in several discussions on the TM forum about whether one can be loyal and offer constructive criticism to TM/EM at the same time.

I believe Dave has traversed that line very nicely here.

For anyone that has been around the TMC forum for some time I believe there are few that could find a more ardent supporter of TM/EM.

While it 'hurts' to read these comments form Dave, they represent what many of us that support the mission statement have come to believe.

TM/EM are truly trying to change the face of energy consumption for all our betterment. That does not mean they deserve a 'pass' on some of their glaring shortcomings as they try to fulfill the mission statement.

 

[ItsNotAboutTheMoney]

Tesla needs cash.
Elon lies to try to keep a positive aura, and avoid a big mass of cancelled reservations.

I think I'm going to reserve a Model 3, just because the potential to get a tax credit (even $1.75k), would be of much bigger benefit that having the $1k sitting in savings. There's also the benefit of putting money down to express my desire for a long-distance BEV. But it weren't for the tax credit, there'd be zero chance of me giving money to the Tesla chaos.

 

[Chickenlittle]

I can relate to Alsop in some ways because I had a troubling experience at the Model X launch. It was by far the worst-run Tesla event I've ever been to (and I've been to almost every single one over the past few years). People were squished like sardines and told to stand for a ridiculous long time as the event started almost an hour late. Elon comes up and makes no apology. And this is after I had to see my friend's 8-month-pregnant wife stand/sit on the ground for 2 hours. The least Elon could have done was to apologize. But anyway, I'll give him the benefit of the doubt. He's probably under a huge amount of stress, press conference probably went over, etc.

After the event I'm trying to get a test ride in an X but they have so few on hand (i.e., maybe 5). And the line is moving so painfully slow that the vast majority of people have no chance of getting a ride.

I talk to one of the main managers for the event, a Tesla employee (who will remain anonymous here but who holds a decently high position). I share my concerns about the late start and lack of test ride cars, and give some suggestions. I end up talking to her for about 10 minutes and the whole time she's brushing me off. Regarding the late start, she basically says "Elon can do whatever he wants. If he wants to start late, then who are you to tell him he can't?"

I've thought about her response since. And it got me concerned that a person like that (ie, low empathetic) would be in such a high position. And then it also got me thinking how many "yes" men/women are surrounding Elon. Who's going to go to him and tell him, "Elon, we're screwing up the X rollout. Our customers are angry."? I'm thinking maybe nobody's telling him that. And that's why Alsop's blog posts surprise him somewhat. And Alsop's frustrated because he thinks he needs to get the message across to Elon. But Elon doesn't think any of it is true and thinks he's just a bad customer.

I've had about 5-10 encounters with Tesla employees this past year where I've felt a disconnect, like the employees where in their own "Tesla is great and can do no wrong" world. Any complaints get brushed off as "we're trying our best". I know this is not true of all Tesla employees because I've met plenty that are very empathetic. But it's just concerning that my experience is so mixed.

Anyway, I think Elon doesn't have a clue that so many X reservation holders have had such a poor and frustrating experience. If he did, I think he'd try to change it.

I take a different view of your comments. As a frequent poster, supporter you felt you were due more respect as an insider. You felt brushed off by a high level tesla exec. Did that person give equal access to everyone else there or did you expect something extra because of who you are? I remember your moving to start a newsletter with your insights on the company. Is that still going? Are you out of sorts because of the money lost by your followers? I can see why you feel down on the company. The higher the pedestal,the harder the fall. I am blunt as usual but do you believe that because of your prior support or newsletter that you deserve your car earlier or inside information, I do not

 

[juschilin]

Dave I am really sorry that you feel let down by Tesla.

My take on your post is that perhaps your expectations in respect of Tesla do not match reality and that may lead to disappointment.


Some examples, your bullet points:

1. You expect and ask for ultra transparency regarding future production numbers. I highly doubt Tesla will ever be ultra transparent and will share specifics on how many cars they will produce and when, and when people can expect to receive their cars. This is asking Tesla to be ultra precise regarding future. That is just not possible for rapidly growing business. Any such attempts at precise projections are bound to be wrong and to bite Tesla back.


2. You expect Tesla to share the reasons for delays. I highly doubt they will always do that. They might, they might not, whatever works for them, but often it might not be appropriate to share for various business/legal reasons.


3. You expect continual communication and openness with Model 3 customers, (hundreds of) thousands of people. Sometimes revealing too much just invites customers venting and vile reactions. It is quite difficult to do a daily job and to manage a wide range of customers and expectations.


4. Your expectations: head roll in case of delays - I am sure Tesla deals with the delays appropriately and in a measured way. There were examples of suppliers and executives parting ways with Tesla due to subpar performance. More often than not these partings are not publicized as publicity may be inappropriate or not legal in some cases.


Regarding taking a deposit and not communicating the way some people desire, Tesla is setting the terms of the deal and it is obvious that one of the terms of the deal is not over communicating on micro/personal level, for whatever reason that might be. These terms can be changed if and when there is competition with better terms.


Regarding stock price, perhaps it is where it needs to be at the moment. My expectation for Tesla is that if they manage to stay going concern, I do not worry too much about share price. The market will value it right.

When macro conditions improve, all stocks will go up and so will Tesla, more than other stocks.

Perfect response.

 

[deonb]

Make it company policy to tell customers, “we don’t know”.

Actually I see this as a positive. The company communication policy up to now seems to have been "if you don't know - just make something up".

So if you are truly starting to get "I don't know"'s out of Tesla SC's and Stores, at least they're not doing something better than they used to.


Of course, an even better approach would be to inform your staff better so that they can give a real answer. But if you're not going to do that, then getting them to admit: "I don't know" is the next best thing to do.

 

[lolachampcar]

I've learned in life that the good stuff takes care of itself and that it is the bad (or potentially bad) stuff that needs attention. In that light, I can understand why Dave wants to discuss what could be done to make Tesla more bullet proof and not how great the company is. Of course it is great; just look at its success to date.

The real question for me is why?
Why publish unrealistic/untrue specs when the car does not require them to sell (thinking HP, 0-60, 1/4 mile for P85D, DL and P90DL)?
Why not have a simple communication structure in place that keeps reservation holders up to speed without compromising the company's internal machinations?
The list can go on but you get the point.

Sure, you can continue with self inflicted wounds because there is no competition and your customers have nowhere else to go but why?

For the record, I've have been and continue to be a huge Tesla fan. At the same time, I posted very early on (early 2013?) about the lack of good business sense within the company and the Valley mentality when it comes to dealing with customers. I see Dave's observations as more manifestations of a fundamental flaw. Given the flaw goes all the way to the top, I doubt you will see much if anything change anytime soon.