They discounted all these RWD vehicles a couple weeks ago, I guess they found the price point / demand intersection point.
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Inventory Discussion
- Thread starter Buckminster
- Start date
The inventory discount on the Model 3 RWD has been bumped up to $2.5k.
If the discount and the return of the $7.5k federal tax credit don't sell these units, I don't know what will. The cheapest Tesla now goes for $30k after federal tax credit. If you qualify for the California rebate, you can get a new Model 3 for $28k + fees and sales tax. These are the cheapest Tesla vehicles in history!
If the discount and the return of the $7.5k federal tax credit don't sell these units, I don't know what will. The cheapest Tesla now goes for $30k after federal tax credit. If you qualify for the California rebate, you can get a new Model 3 for $28k + fees and sales tax. These are the cheapest Tesla vehicles in history!
Perhaps potential buyers are still waiting for clarification on the updated rebate amount, or maybe they are just ignorant of these changes. Otherwise, I don't see why anybody in search of a new sedan would not jump on a $30k Tesla. Maybe we should head to the Advertising thread ...
In other news, used inventory is selling like hot cakes. Most Model 3 units I saw on Tesla a couple of weeks ago are now gone. Almost all of them come with EAP or FSD. Looks like people are happy to snatch these upgrades at a discount. Selling used cars is a great way for Tesla to reach the lower price point customers who don’t qualify for the tax rebates and to push EAP/FSD to more customers.
The first Model 3 Long Range units have hit inventory! $500 discount to start, much lower than the discounts on the 2 other Model 3 trims. Tesla is probably feeling out the demand for the Long Range upon its return.
Looks like a bigger batch of the Model 3 Long Range hit LA over the weekend. Given the current discounts, a Performance costs about the same as a Long Range. Maybe bigger discounts on the Long Range are coming.
In other news, the Model Y inventory was sold out. All inventory units are in 'Coming soon' status.
So Model Y is selling like hot cakes, while Model 3 is likely going to get further discounts to clear inventory by the end of the quarter. Hope the margins on the Model Y units are large enough to offset the low margins on the discounted inventory Model 3 units.
Or maybe a global price reduction or incentive on the Model 3 is pending? Free supercharging miles?
In other news, the Model Y inventory was sold out. All inventory units are in 'Coming soon' status.
So Model Y is selling like hot cakes, while Model 3 is likely going to get further discounts to clear inventory by the end of the quarter. Hope the margins on the Model Y units are large enough to offset the low margins on the discounted inventory Model 3 units.
Or maybe a global price reduction or incentive on the Model 3 is pending? Free supercharging miles?
I think it’s definitely some buyers showing hesistation about the listed models that qualify on IRS website. Is the 3 standard range even listed as qualifying for the entire $7500? Another item to consider is some people won’t pay in even close to 7500 in federal tax in 2023. So their credit is limited to 3100 if they only pay that into federal withholding. Did Elon even explain WHY it qualified suddenly? If I was guaranteed the 7500 and perhaps a 30k price for the vehicle it would be what I would consider a strong value. I’d drive the car for 7 years and then sell it probably for 15k leaving a cost to drive or 178 a month (excluding taxes interest if you finance) which is nothing. Last but not least savvy buyers may be waiting til the last week of the quarter to get the sweetest deal of all.
Doggydogworld
Active Member
They show 27 Ys and 50 3s in south TX. No 3 LRs, only SR at 2500-ish discount and P at 3300-ish. Only 5 of the Ys are discounted, and only ~500 bucks.
Indeed.
Not sure if Tesla offered any special discount on the Model 3 SR at the end of Q1. Inventory buildup is relatively new for the US market. If I were a buyer though, I'd wait till the last week of the quarter as you said. So let's watch inventory movement in the next couple of weeks.
Hmm more Model Y inventory than I'd expect. The one Model Y configuration in LA that's available also has a $500 discount. I think the Model Y units will sell out nationwide for sure, but pushing the Model 3 units out will be much more difficult. Maybe some additional incentive in the very last week will help.
The newest offer to move the old 3’s is laughable. Tesla raised the discounted price by $250 and claimed to offer 3 months of supercharging. This is basically a switcheroo of value to get net zero of value. We now know Tesla accountants value charging at $83 a month lol. This won’t move cars
Doggydogworld
Active Member
IMHO these are all just experiments. Most are too small to meaningfully change total sales, but by studying the effect of small perturbations they can learn what type of promotions generate the biggest response.
I think the wild price gyrations of the past 12-18 months produced blowback, so they're looking for more ways to change the transaction price without constantly changing the headline price. That's one advantage of legacy's dealer/MSRP model. Maybe the only advantage, ha.
They've also done some weird things with leasing lately. The premium Euro brands do a lot of backdoor discounting via leases, so I think Tesla is experimenting with that as well.
The Model 3 LR discount has been bumped up from $500 to around $1,500.
The Model 3 SR discount, on the other hand, has been cut from $2,500 to around $2,200. It doesn't look like Tesla has been clearing inventory though; there are a lot of configurations available in LA.
The discount on the Model Y has stayed the same at $500.
The Model Y inventory has grown tremendously in the past couple of weeks. There are now 30 configurations available in LA.
There is likely going to be a larger gap between production and delivery this quarter than in past quarters.
The Model 3 SR discount, on the other hand, has been cut from $2,500 to around $2,200. It doesn't look like Tesla has been clearing inventory though; there are a lot of configurations available in LA.
The discount on the Model Y has stayed the same at $500.
The Model Y inventory has grown tremendously in the past couple of weeks. There are now 30 configurations available in LA.
There is likely going to be a larger gap between production and delivery this quarter than in past quarters.
The flattening of the $TSLA delivery wave began in Q3 '22. The diff between Production and Deliveries peaked in Q4 at 34.4k. Since then the diff is declining.I expect the Q3 '23 gap to be about 10k and perhaps we see a steady state of 6k-8k gap from there forward.
This is both informative and accurate, on a steady state basis. The discrepancy between my view and this one is predicted on the impact of Cybertruck being produced in a single factory for some years with wide distribution, albeit only is large pickup truck markets, the continuing expansion of countries served by exports including Monterrey serving all of South America and otter's coming. Those will all end out being optimized but there will still be inventory build to support new distribution.
The largest single factor by far really has just begun. That is the evolving transition to a mix of building-to-order and sales from inventory. As that grows so too, by definition, will inventory to make those sales. That is distinctly different than past history and is NOT a problem. It is a consequence of massive growth in sales volume which makes it more efficient to have some inventory than to ship only on order.
I have zero argument with @The Accountant analysis, on a steady state basis. Tesla has thrived without consistently maintaining store inventories for reasons we all understand. As volumes pass to levels that allow broader distribution in existing markets and entering smaller and/or more remote markets the underlying supply equations change. If my perspective is incorrect then there may never be any material change in global DOH. FWIW, despite my views I think it to be very unlikely that anything approaching traditional OEM inventory levels will ever happen. Why? Because the Tesla approach to equipment levels, software upgrades and model mix will always have many fewer mixed variants than do traditional OEMs. A substantial part of traditional OEM inventory levels is the multiplicity of distinct hard-wired models, so necessitating large inventories made up of many models. Check any major OEM in detail and you'll find quite a few models with 180days or more and other models with only a few days. That will not happen with Tesla.
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