If Tesla is getting killed on AWD what happens when.....

[mongo]

If Tesla doesn't get this crap straightened out -- they have to start delivering the correct car to the person who ordered it, on a date mutually agreed with the buyer, in decent condition -- they're dead in the water. I'm not sure how long it'll take for them to be dead in the water, but this is company-breaking stuff.

Tesla already has severe reputational / brand damage from this. If it isn't cleared up by the end of Q4 it's going to become permanent reputational damage.

I call bull hyperbole.
Absolute worst case situation makes them the same as every other OEM and they resort to having cars sitting on lots waiting for people to come get them.
"Come on down to Tesla central, if it's here and has a hang tag you can take it home today." Tie that to a web search, and watch teh people fight over the inventory..

Know how many dealers in a 100 mile radius had the specific Explorer we were looking for?? Zero.... Only like 5 of the model we wanted, most had zero of the type at all for test driving.

Edit: word choice.
Nobody buys those anymore, they're too popular.

 

[ceekz]

If Tesla doesn't get this crap straightened out -- they have to start delivering the correct car to the person who ordered it, on a date mutually agreed with the buyer, in decent condition -- they're dead in the water. I'm not sure how long it'll take for them to be dead in the water, but this is company-breaking stuff.

Tesla already has severe reputational / brand damage from this. If it isn't cleared up by the end of Q4 it's going to become permanent reputational damage.

My account is showing a delivery date of "Sept - Nov '18" so I'm still well within that time frame. The mistake is that Telsa has let me to believe that I was going to take delivery on Sept 23rd. And then there is the miscommunication and lack of it that has been completely unprofessional.

 

[mattjs33]

I have not a slightest doubt that it will be here. Most people will pay more for options, but the base should be here as promised.

I do believe the Short Range car will eventually show up. However I don't believe the $35K car will show up. Or if it does, it will show up the way the $49K Model S showed up.

Tesla basically told everyone they will not make money on a $35K Model 3. Even the most ardent supporter here will tell you they don't want to build it. Some 'base' version of the Model 3 will be available at some point, but before then I strongly suspect Tesla will sneak in some price increase justified by something. That's my prediction, so don't bother to argue with me about it.

By the time the Model 3 is making money, it will already be time for a refresh. It will be the perfect time to raise prices. There's lots of precedence for this.

I also strongly suspect that all Tesla cars are built the same (except of course RWD v. AWD), and that the only difference between P versions or different battery versions or the autopilot actually being enabled is programming. There's evidence to support this. This should probably bother some people more than it does, but the car is so awesome so eh, whatever.

 

[mongo]

Tesla basically told everyone they will not make money on a $35K Model 3.

NO!
They said they would not make money at low volume during the line 3 ramp up.

Even the most ardent supporter here will tell you they don't want to build it.

They want to build it. It is part of accelerating the adoption of sustainable transportation.

The first master plan that I wrote 10 years ago is now in the final stages of completion. It wasn't all that complicated and basically consisted of:

1. Create a low volume car, which would necessarily be expensive
2. Use that money to develop a medium volume car at a lower price
3. Use that money to create an affordable, high volume car
   And...
4. Provide solar power. No kidding, this has literally been on our website for 10 years.

 

[Moderatefan]

Tesla basically told everyone they will not make money on a $35K Model 3. Even the most ardent supporter here will tell you they don't want to build it.

Not true. Don't forget:
Tesla Model 3 teardown shows over 30% profitability as Munro research firm 'eats crow' - Electrek

And here's Elon's quote:
Fred Lambert on Twitter

 

[voip-ninja]

NO!
They said they would not make money at low volume during the line 3 ramp up.




They want to build it. It is part of accelerating the adoption of sustainable transportation.

I do think they can make money on a SR $35,000 eventually. Sandy Munro who did the cost analysis on the Model 3 thinks they would make a small profit on it as well. Whether that profit will be enough for all the down-the-road costs of warranty, servicing, recalls, that is still a decent question I think.

Someone recently compared Tesla to Ford and indicated Tesla is not a luxury automaker. I disagree. There is nothing, zero, NADA, preventing Tesla from building something like a Nissan Leaf right now and making a small profit on it. I remain skeptical that Tesla aims to do this. Tesla wants to drive the move to sustainable transportation by making EVs high performance, cool, objects of envy so that people who would not normally even consider an EV decide they have to have one.

This halo effect then trickles down to those who make EVs that are weird-mobiles.

Just like Apple, Tesla is positioned (and I believe intends to remain positioned) as the 'Apple Computer' of electric transport. They will make the high margin sexy stuff people will pay more for and they will leave the budget stuff to whoever becomes the Samsung of the EV world.

For all of these reasons I see Tesla shipping a $40K SR with PUP and coming up with some excuse on why they can't afford to do the tooling and put the cheaper interior in to do the $35,000 version... at least until they simply can't put it off any longer... then they ship 10K units of the "waiting 4 years for model 3" edition and then kill it off.

 

[lklundin]

Are we still holding onto the fantasy of the $35,000 Model 3?

*Plonk*

 

[lklundin]

If they have to be negative Q1 to "scale up" SR deliveries the market will forgive them.

Also, while not popular, Tesla can decide to push SR to the back half or last quarter of next year. They can cite demand for P and AWD overseas to defer SR production.

From the various data points that Tesla is preparing to export Model 3 to Europe, I am guessing that they will start taking domestic orders for the SR in limited quantities starting next year.

I imagine these orders would be taken especially for buyers who can take delivery directly in Fremont, so no shipping further reduces the margin that is lost by not filling an LR order.

By that reasoning, European SR orders will likely need to wait a good deal longer.

 

[MXWing]

From the various data points that Tesla is preparing to export Model 3 to Europe, I am guessing that they will start taking domestic orders for the SR in limited quantities starting next year.

I imagine these orders would be taken especially for buyers who can take delivery directly in Fremont, so no shipping further reduces the margin that is lost by not filling an LR order.

By that reasoning, European SR orders will likely need to wait a good deal longer.

I'm going to undermine myself by giving this advice as I'll be looking for them at some point.

A used RWD with no tax credit is going to be a few thousand more than a SR with no tax credit.

You get the better interior, exterior, range and thousands of miles on an EV is not the same as thousands of miles on an ICE.

 

[Darren Donovan]

I call bull hyperbole.
Absolute worst case situation makes them the same as every other OEM and they resort to having cars sitting on lots waiting for people to come get them.
"Come on down to Tesla central, if it's here and has a hang tag you can take it home today." Tie that to a web search, and watch teh people fight over the inventory..

Know how many dealers in a 100 mile radius had the specific Explorer we were looking for?? Zero.... Only like 5 of the model we wanted, most had zero of the type at all for test driving.

Edit: word choice.
Nobody buys those anymore, they're too popular.

Probably because you're in a very small minority who wants that specific combo. The vast majority of Explorer customers like whatever options Ford put in the cars on the lot.

 

[mongo]

Probably because you're in a very small minority who wants that specific combo. The vast majority of Explorer customers like whatever options Ford put in the cars on the lot.

It wasn't even that specific, just a Sport in one of couple colors... Could be people liked them too much and bought em all.

 

[Jedi2155]

I'm on a similar opinion on this, the brand damage from this is serious, and they have they get their act together on this by then. On the bright side, I don't see them ramping up their production much more past this (8000 Model 3's max, kind of) so I think they have a good shot at fixing it.

I'm going to correct myself here because from the latest Panasonic PR piece, Elon was said to revive the goal of 10,000/week sometime in 2019. Still, that's only a small ramp up % wise compared to what we're experiencing now.

 

[TeeEmCee]

They are absolutely not building everyone a custom car. They are building RWD and dual motor cars and putting different wheels on them and painting them different colors. In case of P3D+ the car does get different brakes and suspension.

There is no indication they are "building everyone a custom car" and every indication they are batch building configurations and then matching them to outstanding orders.

They do provide a custom assortment of quality issues for each and every car though.

 

[Knightshade]

I call bull hyperbole.
Absolute worst case situation makes them the same as every other OEM and they resort to having cars sitting on lots waiting for people to come get them.
"Come on down to Tesla central, if it's here and has a hang tag you can take it home today." Tie that to a web search, and watch teh people fight over the inventory..

Err... isn't that exactly what they did a few weeks back in Fremont at the big event? People thought they were coming to get "their" car and it turned out to just be a bunch of prebuilt cars and you could hope you found one that matched your config (and pay a higher price for doing it too!)

Know how many dealers in a 100 mile radius had the specific Explorer we were looking for?? Zero.... Only like 5 of the model we wanted, most had zero of the type at all for test driving.

Know how many dealers in a 3000 mile radius had the specific Lexus I was looking for in 2007? Zero. That config didn't exist, though it was possible to build.

So I special ordered what I wanted from the dealer. All the pricing for every option was known at the start, and never changed during the wait (not so Tesla where they didn't even announce AWD and P till months after RWD, and pricing has changed on those options repeatedly)

He took $0.00 up front (not so Tesla that too $1000 in 2016 and another $2500 when I configured).

Payment due when I was going to actually pick up the car. (not so Tesla which insisted on Payment a week ago and the car still isn't in my state, if it's coming at all)

He provided status reports throughout the process (not so Tesla- which was largely a black hole of info)

Including providing a VIN as soon as the car came off the assembly line in Japan (not so Tesla who insisted you don't get one until just before delivery- since they might give yours away to someone else on the way)

And location tracking for each step of its trip from Japan to CA, then CA to NC. (not so Tesla whom every time I ask can only tell me the car is "in transit somewhere")

When it arrived it went through dealer prep, and I was asked what time would fit my schedule to come pick it up (not so Tesla where if you can't make it they just give it to someone else and you get back in line)

Upon pickup the car was perfect, and after going over it, I paid them for it and drove it home. (I'd like to HOPE this isn't a not so tesla, except the already paid for it part... will find out when I actually get to pick it up)

Entire process start to finish was a few months and smooth as silk.

Not so Tesla.

 

[ebmcs03]

They start mass delivery of SR cars early next year?

They will handle it fine. Cuz they won’t deliver more than a handful of SR. It’ll be discontinued quick.

 

[sperkin]

If Tesla doesn't get this crap straightened out -- they have to start delivering the correct car to the person who ordered it, on a date mutually agreed with the buyer, in decent condition -- they're dead in the water. I'm not sure how long it'll take for them to be dead in the water, but this is company-breaking stuff.

Tesla already has severe reputational / brand damage from this. If it isn't cleared up by the end of Q4 it's going to become permanent reputational damage.

It’s a nice problem to have. They can’t get their product out fast enough. I have many friends in China waiting for Model 3s to comes. I’m sure many in Europe are also waiting.

 

[Xenoilphobe]

Are we still holding onto the fantasy of the $35,000 Model 3?

I agree, I bet they fill the $35,000 hold outs and kill it like they did with the rare Model S 40....that would be the smartest move...

 

[bhzmark]

If demand for cars with more options (and more margin) continues to exceed production/supply then Tesla would be stupid to take up a slot on the limited assembly line with a lower margin car. That would simply be generating a certain economic loss, for an unlikely PR gain. Actually better PR is for the story to be: "everyone loves our cars so much, they buy every single $50k car we make! We can't make enough of them!"

Tesla can prudently make and sell $35k cars when in makes financial sense to do so, namely when supply of costlier cars would cross the demand line for those costlier cars -- and not before.

 

[ItsNotAboutTheMoney]

I agree, I bet they fill the $35,000 hold outs and kill it like they did with the rare Model S 40....that would be the smartest move...

No! No SR would by implication mean a dead Tesla. It implies that they have to sell a $44k car just to be get by, which would imply that their lunch will be eaten from one end by mainstream manufacturers, and from the other end by the premium manufacturers. They can shift more LR right now because there's the juicy $7.5k tax credit + state incentives but those aren't going to last long.

The majority of the premium market is at the lower end. It's what were the 320d buyers*, who want into premium, but still look for some value.

Tesla _needs_ to be able to sell the SR.

* It was _half_ of BMW 3 series sales.

 

[mongo]

Err... isn't that exactly what they did a few weeks back in Fremont at the big event? People thought they were coming to get "their" car and it turned out to just be a bunch of prebuilt cars and you could hope you found one that matched your config (and pay a higher price for doing it too!)

Yep, worst case, Tesla is like a typical OEM.
Why was the price higher?

Know how many dealers in a 3000 mile radius had the specific Lexus I was looking for in 2007? Zero. That config didn't exist, though it was possible to build.

Not that it matters, but it was a standard Explorer Sport, there were a total of 3 in any configuration/ color. We could have special ordered, with deposit, but decided we were ok with a different color.

Glad your delivery went smooth!