Model 3 Ludicrous 2.0 seconds flat?!!

[dss33]

The pessimist (read: realist) in me says $100k+ for a loaded 3. The argument "but but this is what the competition costs!" is kinda ridiculous when you look at what will make a loaded 3 loaded. You can't magically cut costs. The only way they'd do that is to neuter functionality or eliminate options altogether. I don't see them doing either based on Tesla's sales model and the "near-loaded" cars they debuted at the reveal. So we pay the price.

I was following your argument there until the end. Musk has said a few times that the car, in order to make it easier to manufacture, will not have all of the bells and whistles that the S and the X do. Perhaps that doesn't apply as much to options as it does to things like auto-presenting doors and FWDs, but I took that to mean that, at least for the first batch of cars, the options will be relatively limited and maybe even skew toward software-unlockable versus there or not. But we'll hopefully see soon enough

 

[igotzzoom]

With literally every option and personalization in the book, I'm thinking the Model 3 will maybe be $75-80k. I will not be buying that model. My absolute max budget is $50k.

 

[Garlan Garner]

After the recent earnings call by Elon Musk.....I am "all boxes checked".

What did I hear on the earnings call that now solidified me as "all boxes checked"? Elons specifically stated that the M3 will be a "no bells and whistles" as the MS and MX are. He mentioned bells such as the "self presenting door handles" of the MS and the falcon wing doors of the MX. He mentioned that the amount of wiring in the harness is HALF of the amount of wiring of the MS or MX.

The M3 appears to be a car that will exclusively have the "necessities" of a great car. - Very few options.

For example: If self presenting door handles would be an option ... I would not check that box.

 

[Model 3]

Keep in mind, the Gigafactory is supposed to drive prices below $170/kWh if I remember right (and I think I read an article saying it had already done more than that?)

From all that I have read about the battery pricing I expect the cell level pricing to be just above $100/kWh for the cells ($100-110). Even if you are more pessimistic then me, it should at least be in the $120-129/kWh. Not sure how much the battery pack add to that... But we know that they was "below $190/kWh" on the pack level last year, and that Tesla now sees at least 35% price reduction (probably on the cell level?) from the GF-I. So I see $170/kWh even at the battery pack level as to be an to high an estimate. $150/kWh at the pack level is absolutely max, probably it is well below that.

 

[Model 3]

and still quickly overheats with vastly reduced power after only a few minutes of demanding acceleration. The problem has not been solved folks.

We do not know that for sure for the Model 3 yet. Different cells, different chemistry, different battery, different cooling(?)... It may very well be that you are right, but we still needs to wait and see before we can conclude.

 

[JeffK]

From all that I have read about the battery pricing I expect the cell level pricing to be just above $100/kWh for the cells ($100-110). Even if you are more pessimistic then me, it should at least be in the $120-129/kWh. Not sure how much the battery pack add to that... But we know that they was "below $190/kWh" on the pack level last year, and that Tesla now sees at least 35% price reduction (probably on the cell level?) from the GF-I. So I see $170/kWh even at the battery pack level as to be an to high an estimate. $150/kWh at the pack level is absolutely max, probably it is well below that.

Back in July Elon mentioned the batteries getting to $100/kWh by 2020. Batteries would imply the pack level

Getting the price per kWh at the pack level below $100 has been a goal of Tesla's for the Gigafactory since at least 2014.

From August 1st, 2014:

Tesla announced yesterday that it had signed a formal agreement with Panasonic Corp. to build a large-scale battery manufacturing plant, dubbed the "Gigafactory." In light of the technical and logistical advances the factory would bring, Musk said he would be "disappointed" if it took Tesla 10 years to make a $100-per-kWh pack, suggesting it could happen before the end of the decade.

AUTOS: Tesla chief predicts price parity with gasoline-powered cars within 10 years

 

[Model 3]

Back in July Elon mentioned the batteries getting to $100/kWh by 2020. Batteries would imply the pack level

Getting the price per kWh at the pack level below $100 has been a goal of Tesla's for the Gigafactory since at least 2014.

I know. I should have stated that my predictions was for 2H 2017, not 2020.

 

[eisbock]

I was following your argument there until the end. Musk has said a few times that the car, in order to make it easier to manufacture, will not have all of the bells and whistles that the S and the X do. Perhaps that doesn't apply as much to options as it does to things like auto-presenting doors and FWDs, but I took that to mean that, at least for the first batch of cars, the options will be relatively limited and maybe even skew toward software-unlockable versus there or not. But we'll hopefully see soon enough

Like, I said, just being pessimistic. I want to agree with you, but a lot of the stuff Tesla offers as options are offered as options elsewhere on similar cars. I can't see them straight up not offering options for the sake of keeping costs down so they can... not make as much money? Avoid the "backlash" that inevitably comes when everybody finds out Model 3 is not truly "affordable"?

I can see Tesla offering those options heavily bundled together though. Maybe we can select from only a handful of trim levels, like instead of offering options as seperate, the design studio will only look like "XX, XXD, YYD, PYYD, PYYDL", and each of those comes with the options for that price point. This would increase manufacturability. Though I suspect there will be some level of customization beyond that.

I think Musk's comment about minimal bells and whistles is what makes Model 3's base cost lower. All that fun stuff is standard in S/X for the most part, and will not be on the 3. Might be offered as an option, but I can see the gimmicks being excluded altogether.

 

[eisbock]

Well, you're certainly entitled to your opinion, and we certainly don't have proof one way or another yet. For the record, I think you're way of base, and the 3 PXXD will start in the same neighborhood as the "competition" I identified earlier.

Keep in mind, the Gigafactory is supposed to drive prices below $170/kWh if I remember right (and I think I read an article saying it had already done more than that?) - which means that the largest plausible upgrade pack (~80 kWh) will cost Tesla less than $14k - and the difference in cost to Tesla from the base pack is likely around $3k. Obviously they'll want some incremental profit as well, but I think your assumption of $10k is excessive.

I certainly respect your opinion, but you can't ignore hard costs. It costs $40k to get from base to P90D on Model S. There's no way you can expect that jump to be less than half that for the 3. Margins on the S aren't that high.

A $20 reduction per kWh means an upgrade on the Model 3 from 55 to 80kWh results in savings of... $500. Big whoop. I don't see how saving 5 Benjamins will drop battery prices by more than half when we're looking at numbers in the tens of thousands. It just doesn't make sense. Again, Tesla can't magically cut costs out of nowhere and still expect to make a profit.

 

[jbcarioca]

Some of seem to confuse issues when discussing Model 3 features, performance and pricing.

First, Elon, JB and every other source confirm that the Model 3 is built for simplicity, including the open roof along production line allowing the interior to be robotically assembled, then the top dropped in place. That, and myriad other things speak to engineering for manufacturing ease and consistency. All of that speaks to the single display pod but says zero about HUD because HUD is easy to install. We need to think about manufacturing ease, not user features, when discussing Model 3. Software enabled features could be simply amazing, so long as manufacturing stays "easy" meaning machines can do it. QC improves with manufacturing ease too.

Second, features are likely to be surprising to most of us because most of them will be delivered via only software or by simple to install models. Either way almost all features that will be optional will be either software-based or modular so they can be essentially 'plug and play'.

Third, performance will be better than simplistic extrapolations of battery size imply. Remember this is a true third generation Tesla with entirely new architecture and packaging. There will be a wide range of options, some of which will come with later offerings. Either way the "P" versions will at least match the SP100D in most relevant measures but with <25% better wh/distance.

Fourth, the everlasting debates about pricing will be resolved because the range with be ~$35,000 starting to ~$90,000 or even ~$100,000. Thus the Model 3 range will be similar to that of the S and X, the BMW, MB etc ranges. Just as with all these cars that wide range will accommodate a vast array of dramatically different tastes and budgets.

Lastly, repetitive though it is, the innovation above all others for Model 3 is in manufacturing ease and consequent ease of installing options while maintaining high build quality. They'll certainly have an array of aftermarket upgrades available for buyers who desire them. That will improve everyone's results, buyers and Tesla's.

Nothing I just said is really new, but most of our discussions imagine that the Model 3 will e just like other cars. It won't.

Some might think me too optimistic. Not so. This approach will
test the living daylights out of suppliers. It is almost unprecedented. It should be better and simpler. I hope it will be. I'm betting it will be.

 

[JeffK]

I certainly respect your opinion, but you can't ignore hard costs. It costs $40k to get from base to P90D on Model S. There's no way you can expect that jump to be less than half that for the 3. Margins on the S aren't that high.

Let's look at costs

60->60D is $5000
60D->100D is $19500
100D-> P100D $39500

for the performance model what do you actually get beyond an inconel connector (which is rather inexpensive)... a larger rear motor.
So we know that the price of the small motor is under $5000, but magically you take away a small rear motor for a loss of let's say $5000 and you have to pay an additional $40k meaning the large motor is worth nearly $45000 alone? No, I'm not buying it, those margins are HUGE.

Tesla can price it any way they want but let's try for a model 3 with some healthy margins. Let's say both a 55kWh and a 95 kWh are available (40 kWh difference like the 60->100)

55->55D is under $5000 (we already know this)
55D -> 95D it's under $190/kWh for Model S/X heading toward $100/kWh for Model 3 but let's say they get to $130/kWh
(40 * 130) = $5200 let's say they sell it at 50% gross profit margin, so $10400 (current battery packs have 2-3X markup so 50-66% gross profit)
95D -> P95D = ??? keep in mind from the old 85 to the P85 the price difference was $10-15k

If we went with 15k$ for the performance upgrade we'd be at 5k+10.5k+15k+35k base price = $65.5k

Realistically this can still be much lower while still getting Tesla a profit.

 

[Saghost]

Let's look at costs

60->60D is $5000
60D->100D is $19500
100D-> P100D $39500

for the performance model what do you actually get beyond an inconel connector (which is rather inexpensive)... a larger rear motor.
So we know that the price of the small motor is under $5000, but magically you take away a small rear motor for a loss of let's say $5000 and you have to pay an additional $40k meaning the large motor is worth nearly $45000 alone? No, I'm not buying it, those margins are HUGE.

Tesla can price it any way they want but let's try for a model 3 with some healthy margins. Let's say both a 55kWh and a 95 kWh are available (40 kWh difference like the 60->100)

55->55D is under $5000 (we already know this)
55D -> 95D it's under $190/kWh for Model S/X heading toward $100/kWh for Model 3 but let's say they get to $130/kWh
(40 * 130) = $5200 let's say they sell it at 50% gross profit margin, so $10400 (current battery packs have 2-3X markup so 50-66% gross profit)
95D -> P95D = ??? keep in mind from the old 85 to the P85 the price difference was $10-15k

If we went with 15k$ for the performance upgrade we'd be at 5k+10.5k+15k+35k base price = $65.5k

Realistically this can still be much lower while still getting Tesla a profit.

Keep in mind, your 60->60D is actually removing a large motor and replacing it with two small motors, not adding a small motor to the existing structure.

The small motors are presumably cheaper than the larger motor, so the cost of the small motor might be more than $5k and still break even/create more margin.

Having said that, I tend to agree - I think a lot of the price difference in the P cars is extra margin, which is okay because folks buying those cars aren't terribly price sensitive to begin with and no one is building anything resembling competition at any price, let alone a competitive one.

 

[JeffK]

Keep in mind, your 60->60D is actually removing a large motor and replacing it with two small motors, not adding a small motor to the existing structure.

The small motors are presumably cheaper than the larger motor, so the cost of the small motor might be more than $5k and still break even/create more margin.

true, good point

 

[Chris L]

Going from a 55 kWh battery to a 95 kWh battery adds 40 kWh worth of weight (a lot!), which adversely affects performance, braking, handling, efficiency, tire wear, etc. It's not just a number. Adding another 40 kWh also adds a lot of volume (73% more than with a 55 kWh battery). Adding that volume means you have to take it away from passenger and cargo space. If you size the battery pack volume to accommodate a 95 kWh battery, then that means there would be a lot of volume wasted in 55 kWh cars — not a good thing. Seems like having a 95 kWh battery option would not be good for the Model 3. 70 might make more sense. My preference would be to optimize the car for the 55 kWh battery (probably not what they're doing).

 

[dss33]

Like, I said, just being pessimistic. I want to agree with you, but a lot of the stuff Tesla offers as options are offered as options elsewhere on similar cars. I can't see them straight up not offering options for the sake of keeping costs down so they can... not make as much money? Avoid the "backlash" that inevitably comes when everybody finds out Model 3 is not truly "affordable"?

I can see Tesla offering those options heavily bundled together though. Maybe we can select from only a handful of trim levels, like instead of offering options as seperate, the design studio will only look like "XX, XXD, YYD, PYYD, PYYDL", and each of those comes with the options for that price point. This would increase manufacturability. Though I suspect there will be some level of customization beyond that.

I think Musk's comment about minimal bells and whistles is what makes Model 3's base cost lower. All that fun stuff is standard in S/X for the most part, and will not be on the 3. Might be offered as an option, but I can see the gimmicks being excluded altogether.

I do agree. Thinking about it a bit more, I think you're correct re: limited number of trim levels, similar in nature to the way they now bundle interior options packages. It'll be interesting to see what they decide to run with.

 

[JRP3]

Let's say both a 55kWh and a 95 kWh are available

I'd be surprised if the 3 can hold more than 80 kWh with existing cell chemistry.

 

[JeffK]

I'd be surprised if the 3 can hold more than 80 kWh with existing cell chemistry.

Where did you come up with that number, seeing as the area of the car is only 10% smaller than the Model S?

We do know the chemistry is different in the '2170's.

 

[zenmaster]

I'd be surprised if the 3 can hold more than 80 kWh with existing cell chemistry.

You could be right, but lacking planned pack and cooling system design we don't know volume requirement.

 

[JRP3]

We do know the chemistry is different in the '2170's.

Do we? They need to put proven chemistry in the Model 3, I don't think it will be any different in a few months from now than what would be going into the S and X a few months from now. The packaging is irrelevant in relation to the chemistry.

 

[Saghost]

Where did you come up with that number, seeing as the area of the car is only 10% smaller than the Model S?

We do know the chemistry is different in the '2170's.

I think I saw an article or quote talking about how the 2170 cells being made for Powerwalls were different chemistry from the existing car batteries. The spin seemed to be that it was about optimizing to the application, though, and I don't think it said anything about the cells for the Model 3 one way or the other.