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Model 3 Average Selling Price Predictions
- Thread starter Paul Carter
- Start date
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- Model 3
Is sales tax added on to a software upgrade once the car is in the driveway?
Sales tax is incurred on the new car cost, 7.5% in my case. The $5000 AP purchase as part of the new car price costs $375 in additional sales tax on the new car. If the $6000 cost for the enhanced autopilot software upgrade isn't subject to sales tax, my net cost of waiting to upgrade is $625 instead of the additional $1000.
Sales tax is incurred on the new car cost, 7.5% in my case. The $5000 AP purchase as part of the new car price costs $375 in additional sales tax on the new car. If the $6000 cost for the enhanced autopilot software upgrade isn't subject to sales tax, my net cost of waiting to upgrade is $625 instead of the additional $1000.
JoaoD
Tech Enthusiast
I don't know the regulation from your country but you are probably gonna have to pay the tax for the upgrades. It's like any other service that you use, you have to pay tax for software purchases or to use a service like renting a computer to host your files (server).
JoaoD
Tech Enthusiast
Tesla has to give you a proof of purchase, usually an invoice or a receipt, and they have to report all of sales to the government, that's how the government knows that you purchased a service from them.
Now if Tesla does not give you any document that proves that you paid them the $ for the service then you are free from taxes. But I really doubt that any large enterprise would do this as tax evasion constitutes a crime, at least here in the EU.
Here in California, I suspect OTA upgrades will be taxed just like downloads of your favorite computer software, especially if the company you're dealing with has offices or stores in California. Sacramento taxes most anything they can get away with. They would even tax the water coming out of you tap if the idiots could figure out how to do it. Vultures!
I think the pricing predictions mentioned in this thread are way high. Having a $85,000 Model 3 completely defeats the purpose of this car. People willing to pay $85k for a Tesla will buy the Model S.
This is their first mass produced car, intended to be an entry level vehicle for the main stream market.
I was in the car business for 15 years and from my experience in the industry, Tesla will more than likely follow some sort of "package discount" model for their options. Or at least they should. For example, they could offer the larger battery with the super charge as one package, for what would be the price of the battery alone, etc.
They will also need to compete with other electric cars (including hybrids) at this price level if they wish to continue to sell upwards of 500k cars per year after the initial "ether" wears off.
That being said, I'd expect a well equipped Model 3 going for around $45k and maxed out no more than the $55k to $60k range. Anything higher than that, Tesla risks losing major ground in sales to competitors after the initial 500k vehicles are delivered.
This is their first mass produced car, intended to be an entry level vehicle for the main stream market.
I was in the car business for 15 years and from my experience in the industry, Tesla will more than likely follow some sort of "package discount" model for their options. Or at least they should. For example, they could offer the larger battery with the super charge as one package, for what would be the price of the battery alone, etc.
They will also need to compete with other electric cars (including hybrids) at this price level if they wish to continue to sell upwards of 500k cars per year after the initial "ether" wears off.
That being said, I'd expect a well equipped Model 3 going for around $45k and maxed out no more than the $55k to $60k range. Anything higher than that, Tesla risks losing major ground in sales to competitors after the initial 500k vehicles are delivered.
Welcome to TMC. Interesting experience and perspective on pricing. I guess only time will tell if my prediction is close.
Darryl
ModelXTracker.com Co-Adm
I thinks Paul's estimate of $81k for a fully loaded Model 3 if anything is low. I have done some analysis and figure a fully loaded Model 3 will run closer to $85-87k. Also as someone else mentioned, in the past Tesla hadn't sold cars with individually priced options but puts options into group. For example there may be a Premium Option Group with upgraded interior, leather seats, ventilated seats, fog lights, and hepa filter. In the past many of the options can't be purchased individually but must be purchased as parts of a group. All car manufactures do the same thing. This forces you to buy something you don't want to get something you do want.
There will those who buy the base car with just a few options and pay around $45k, those who want a nicely equipped car and spend $65k and those who want all the options and spend over $80k.
To that you have to add Destination and documents fee of another $1,000-$1,200 plus your local sales tax which in my state would run $3,000 to $6,500. Even using Paul's numbers for a fully loaded Model 3 including delivery and state taxes in my state it would cost $88k. This is does not include the pre-paid service options or extended service plan.
If you want a $35k model 3 you will be able to buy one and it will probably be one of the nicest $35k cars around. Since they have already said they will build the cars with the most options first it looks like there will be very few people who buy the base car eligible for the $7,500 rebate.
There will those who buy the base car with just a few options and pay around $45k, those who want a nicely equipped car and spend $65k and those who want all the options and spend over $80k.
To that you have to add Destination and documents fee of another $1,000-$1,200 plus your local sales tax which in my state would run $3,000 to $6,500. Even using Paul's numbers for a fully loaded Model 3 including delivery and state taxes in my state it would cost $88k. This is does not include the pre-paid service options or extended service plan.
If you want a $35k model 3 you will be able to buy one and it will probably be one of the nicest $35k cars around. Since they have already said they will build the cars with the most options first it looks like there will be very few people who buy the base car eligible for the $7,500 rebate.
FlatSix911
Porsche 918 Hybrid
RobStark
Well-Known Member
No more than people willing to pay $85k on a BMW M3 instead chose to buy a BMW 7 Series. Mercedes AMG C Class vs S Class etc. Some people simply have a strong preference for a smaller car. Easier to maneuver, easier to park, and/or simply prefer the look.
Tesla selling an $85K Model 3 does nothing to prevent Tesla from selling a *sugar* load of $35k Model 3. In fact it allows Tesla ,if it chooses, to sacrifice margin at the bottom if it can make it up on top and still meet its margin and volume goals.
Doubtful it was in the marketing department of a successful firm.
And there is nothing on the horizon that matches Tesla on the entire value proposition: range, Supercharger Network, auto pilot/ autonomous mobility, design etc.
And Hybrids are crap. HEV/PHEV are intrinsically flawed having two powertrains, taking up up to twice the room, up to twice the weight, doubling complexity. Prius( the Standard Bearer of Hybrids) sales are taking a dive while Tesla sales are surging.
lol. You're an enthusiast, so of course buying a Tesla makes more sense to you. I was a sales director for the largest volume car network in Central Florida. We sold over 1000 vehicles per month. So yes, I am well aware what the general public likes and values in terms of cars. And this car is intended for them, not just for enthusiats as yourself.
In 3 to 4 years, Tesla would have already delivered at least the first 500k or so of these models....most to enthusiasts. Then they will need to compete with other makes in order to continue to sell 500k or more cars per year.
Who would buy an 90k Model 3 over a similarly equipped Lexus or Acura for half the price?
Only an enthisiast.
Thanks, I appreciate it. Your predictions could very well turn out to be correct. And I don't think Tesla will initially have problems selling Model 3's if they are priced that high. But like I said, if they wish to continue to sell 500k or more of these vehicles per year, they will eventually need to compete for that market. And that market is under the $50k or so price range.
EXOTIC1
Member
Maxed out you're way low
75-85k will be more in range
Mercedes base C class 35-40k mass produced entry level BENZ
Mercedes AMG version 80-85k
it's all relative as it's basically the same car
N5329K
Active Member
I think your "well-equipped" numbers are fine. However, I think "ludicrously-equipped" examples will go for north of $75K.
Robin
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Maybe. I guess if Tesla is still able to give enough options for it to compete with similarly equipped vehicles in the $45k range.I can see a top range selling for $75k ish, if it can compete for other specialty vehicles in the $75k price range.
I'm also guessing that Tesla will rely heavily on the European market, where the price of fuel is 3x to 5x what it is in the states, if sales in the states become sluggish.
RobStark
Well-Known Member
Tesla will never run out of "enthusiast."
Same nonsense was said about the Model S when the P85+ was introduced.
Tesla has more customers than they have capacity to produce P100D vehicles with prices approaching $160k. Who would buy a P100D when you can buy a similarly equipped Lexus or Acura at half the price?
Look at the recent sales of Model S vs Lexus LS460 in the US.
BTW We said Model 3 at $85k which is roughly half the price of a fully loaded Model S. Yes, if you keep raising the price $5k every 24 hrs the market for a fully loaded performance Model 3 shrinks.
Maybe. Maybe on a global level they won't have issues selling 500k vehicles per year. I was mostly thinking of the U.S. Market.
Does Tesla eventually want to sell millions of vehicles per year though? Or will they be happy selling 500k to maybe 750k vehicles per year, to a niche market?
You gotta be kidding - right? I highly doubt that you will be ever be able to buy a $45K Lexus that matches a "nicely configured" $75K Model 3 in all areas. The rear wheel drive, 2017 RC F starts at $64,165 before options, 0-60 in 4.4 seconds, on, and on, and on. A nicely configured RC F will run about $80K and still be left in the dust by a nicely configured M3 for the same price.
