Model S 60 and 60D to be removed

[mbhforum]

If you think it's BS you're right, but the formal term is "marketing".
They have to give a reason, and they can't just say it's to separate the price points of the M3 and MS. That would annoy people.
But it's pretty obvious to close observers like you find on these forums.

Couldn't agree more. They are not losing money on the 60's. Tesla is in the business of making money, so they didn't decide, "let's lose money for another month". They are doing it this way to increase 60 sales in the short term for end of q1 and then create the separation of price points for the upcoming m3. I highly doubt they will be revealing any new refresh of S as they need to really focus on the m3 release. They aren't big enough to make all of these drastic changes at once. They are still a young company that is going through growing pains.

 

[Rbcnr]

An interior refresh won't be too surprising but I doubt they will completely change it. How many of you think they would introduce HUD to MS before they show it on the M3? Less wow factor plus hands full with M3 and AP. Doubt they would reveal at the same event. Just curious

 

[FlatSix911]

According to Electrek ... Tesla is discontinuing its least expensive Model S with 60 kWh battery pack next month
I am not buying Tesla's explanation. Now only 5 variations of the Model S remain... and the 90D is next to go

...Tesla is planning to discontinue the least expensive versions of the Model S next month. Today, Tesla started sending out emails to warn potential buyers who have shown interest in the vehicles that the change is coming and Electrek confirmed the news with Tesla. April 16th, 2017 will be the last day to order the Model S 60 and 60D. The vehicles were the least expensive models that customers could purchase from Tesla – starting at $68,000. The Model S 60 and 60D were equipped with 75 kWh battery packs software-locked to 60 kWh. Owners were able to unlock the remaining 15 kWh through a software update for a fee at any time after the purchase if they decided that they wanted more capacity.

Tesla says that they are making the change because most customers ultimately end up upgrading to 75 kWh and they want to streamline the ordering process. It comes as Tesla is preparing to launch the Model 3, which should start at $35,000, but higher performance versions are expected to be offered at higher prices closer to the price of the Model S. It would make sense for Tesla to try to create a bigger gap between the two vehicles.

The base version of the Model 3 is expected to feature a battery pack smaller than 60 kWh and we reported that Tesla has been driving a Model 3 test mule with a 70 kWh battery pack. Now that Tesla’s least powerful option for the Model S is about to become a 75 kWh battery pack, it would make sense that the less expensive Model 3 would have an option below the more expensive Model S.

 

[jimmyz80]

Except they are the same packs - neighbor.

So I'm sure there is the 3 range thing which has only been mentioned once. The base 3 shouldn't have a longer range than the base S. So perhaps mid April is Reveal #2. And at the same time - new interior for the S? Or some other next big thing. Have to keep the S orders flying. I'm glad I am not needing a new car now. Probably would get a stripper 60 - best deal. To be replaced in a month by the new S thing and then a 3. I think there will be a tough psychology out there spending $75k on an S when you really want a 3 but the wait is 2 years. That market will be tanked once the 3 is on the road. So Tesla needs to get more of the usual MB/Big BMW crowd - so they need to get to interior par.

True, and to be honest I briefly forgot about that since it was like 3am when I posted this. I still wonder if there's any positioning going on here though in terms of that strategy. Maybe costs are such that 75kWh would become the new base-model with the new cells, at roughly the cost of a 60kWh previous-gen car? Who knows...

 

[rainforest]

The MX60 was a great deal while it lasted as well.

I'm so grateful that I could get the X60D while it lasted. Only thing though is that the X has 30km less range than the S60D. Hope the range is good enough for me.

 

[Sonny Daze]

Well that's disappointing. If I am not happy with the final version of the 3 I was going to consider an S60. That won't be happening.

 

[AnxietyRanger]

Couldn't agree more. They are not losing money on the 60's. Tesla is in the business of making money, so they didn't decide, "let's lose money for another month". They are doing it this way to increase 60 sales in the short term for end of q1 and then create the separation of price points for the upcoming m3. I highly doubt they will be revealing any new refresh of S as they need to really focus on the m3 release. They aren't big enough to make all of these drastic changes at once. They are still a young company that is going through growing pains.

Instead of Q1, they are actually creating demand for Q2.

The 60 sales end, with international 14 day confirmation window included, on April 30th. That leaves exactly two months to deliver those 60s during Q2 and count them as Q2 sales. Two months is enough to deliver the car to most of Tesla's markets.

It is, once again, Tesla's quarterly play. Q2 is being beefed up here. I'm guessing the 90 will go during this time period as well, maybe at discounts, to unload any remaining batteries and beef up the Q2 numbers.

Q3 will be all about Model 3 and possibly other demand levers (if the expected Model S/X upgrades are "delayed" there?).

 

[sorka]

I'm not surprised. Just last week I wrote here why Tesla would discontinue the 60 soon. Last month I wrote about it here and here. I was expecting this. I think many of us were expecting it.

Nice job. Here's your:

 

[hariclt]

Overall - lots of good thoughts. They were not losing money on the 60 - but my initial thought is that a S60 should end up being worth a lot more than it would have been in the future ... this is of course unless the M3 just rocks everyone's socks off and has a longer range or a better EAP or something .. typically good to own the least expensive home in a very expensive neighborhood ... many folks end up getting a used 5 or E series vs a new 3 or C .. those cars are just too small for some folks ... my mom is a good example - just could never get a C class.

 

[OBX John]

I'm glad I bought when I did! I think. Hopefully this will make my car worth a bit more when I trade it in on a 100D.

 

[vigge50]

Last quater tesla had a 22.2% margin on there cars and I'm completely sure that they have higher margin on the more expensive models and extra equipment so let's say that they have 15% margin on a Model S 75. The Model S 60 cost 9% less but is the exact same car. That means they have a profit margin of 4.6%, maybe to low for Tesla?

 

[geometro]

Well that's disappointing. If I am not happy with the final version of the 3 I was going to consider an S60. That won't be happening.

^ This.
I was also hoping to compare the two models to decide. I don't care for the size of the S (slightly too big), but am uncertain if the 3 will be too small.

 

[bredi]

I don't like this move. Better to NOT have a jump between car lines. Its better to be closer. Hence BMW 1,3,5,7 series. 325, 335. etc.How many of us were willing to spend money on a lower version item, to only get just close enough to self justify the next model up?
F'it i'm already spending XXXXX, what just a little xxxx more?

I'd rather they drop it because the 75 and 75D is replacing it, and to make room for the 100D and the next battery jump. Keeping the entry level the same price point.

 

[Burnt Toast]

I don't like this move. Better to NOT have a jump between car lines. Its better to be closer. Hence BMW 1,3,5,7 series. 325, 335. etc.How many of us were willing to spend money on a lower version item, to only get just close enough to self justify the next model up?
F'it i'm already spending XXXXX, what just a little xxxx more?

I'd rather they drop it because the 75 and 75D is replacing it, and to make room for the 100D and the next battery jump. Keeping the entry level the same price point.

I think this is what will happen, or there will be a compromise between the 60 and 75 price point. I think that they will probably change the model structure to 75 @ close to 60 prices, then a software limited 85 (100 battery) and the 100. Hopefully this will result in a price drop again for the 60-75 upgraders.

Right now in Australia a 60D with a couple of options is $150k. If they only have the 75 @ the current price point, their range is going to start at $170k here, which is way too expensive for any brand.

 

[Reeler]

I wonder if they will bring back the 70? Maybe they get honest about things and relabel the 75 as a 70 since it is actually a 72. The 90 could be relabeled as an 85. Keep the 100.

So you end up with 70, 85 and 100 as options.

 

[Troy]

Tesla won't bring back the 70. In fact, they will discontinue the 75 too because after the Model 3 75D specs are announced (range, performance, and price), sales of the Model S 75/75D will start dropping and it will continuously drop to almost zero until these versions are discontinued. My best guess is, they will discontinue the Model S 75/75D in July 2018 and the Model X 75/75D in Dec 2018.

Tesla will announce the Model 3 specs before 15th June 2017 because they need to open the design studio to employees. In this shareholder letter, Tesla said they will start low volume production in July and high volume in Sep 2017. Of course, not all supplier parts will arrive before July. 1-2% of parts will be missing. Tesla will substitute these with what they call "prototype parts". These are hand made or 3D printed parts. During the last conference call, Elon said these might cost as much as 30 times more than volume produced parts. The reason they want to start low-volume production in July is because the production line needs fine tuning before they start high volume production in September.

For a while, this will be the most popular car Tesla sells:

Model 3 75D:

• 304 mi EPA rated range (Seel my calculation here)
• 5.0s 0-60mph (Should be slightly quicker than S75D's 5.2s because of less weight)
• Dual motor AWD
• $47,000 before options (35+8+4=47. $35K for 55 kWh base model. $8K for the battery upgrade to 75 kWh. $4K for dual motors)
• 18% more efficient than the Model S. Charging costs will be 18% less. 12.5% of the 18% is because of 0.21 drag coefficient instead of 0.24. 2.9% is because the frontal area is 2.9% smaller. 2.6% is because of reduced weight.
• 18% faster supercharging compared to the Model S 75D because of higher efficiency.
• About the same cabin space as the Model S. The height of both cars is exactly the same at 1435mm. The width is very close too. I have measured the frontal area of both cars. See details here. The Model 3 has only 2.9% smaller frontal area. 12.5% of the efficiency gain is because of the aerodynamic shape of the frontal area. That means it is likely that Tesla will change the Model S/X front design to the same as the Model 3.

If somebody is contemplating whether or not it would be a good idea to switch from an S60/S60D/S70/S70D to a Model 3 75D, that would be absolutely the correct idea. It is better to do the switch sooner instead of waiting because the market value of second hand 60 and 70 kWh Model S will start dropping after Model 3 production starts. Also, the Model 3 delivery priority to existing owners is not going to last much longer. My best guess is, the deadline will be 1st July 2017. However, I think many people will stick with their Model S 60 or 70 kWh because of psychological reasons even if they could do the switch this year without losing any money which won't be the case in 2018.

 

[AnxietyRanger]

@Troy

I am not convinced Tesla can drop the lower-end Model S entirely (meaning 75 or similar follow-up), at least not until they have something in the BMW 5/Audi A6/Mercedes E class of cars, which they probably won't for a few more years...

As it stands, Model S is sort of covering the entire range of the 5-7/A6-A8/E-S segment, for which Model 3 is simply too small. Model S is already expensive for that range, removing its lower-end option would push it solely into the BMW 7/Audi A8/Mercedes S class territory, leaving nothing in the lucrative volume mid-segment of "boss cars".

After all, dropping the software-upgradeable 60 (which by design has poorer margins than the rest of the fleet) is quite different from dropping a 75 from the line-up.

I can see 75 turning into 80 or something, but dropping a lower-end Model S entirely... I don't see it.

 

[JRMW]

I wonder if they will bring back the 70? Maybe they get honest about things and relabel the 75 as a 70 since it is actually a 72. The 90 could be relabeled as an 85. Keep the 100.

So you end up with 70, 85 and 100 as options.

Doubtful from a marketing perspective
Numbers going down looks like going backwards. People here might know about the "true" pack sizes but 99% of consumers don't. Most don't even know where you put the gas or how to change Teslas oil

Imagine if Apple released the iPhone 5 next year

Tesla brought back the 60 for only 1 reason. To increase demand last year by pulling Model 3 orders into 2016. They were very successful, especially combining it with the pre-announced $2k price hike and removal of unlimited free SC access.

Now they announce this to urge the rest of the potential 3 laggards into an S, and to put distance between Model 3 pricing and Model S pricing.

Remember, model 3 will be cheaper for Tesla to build. Thus, higher margins. Tesla makes big margins in options. Thus an optioned out 3 will have far higher margins than a "stripped" S.

My guess is that means that an optioned out 3 may hit $60k or more, and Tesla doesn't want the 3 to "compete" with a stripped S

 

[AnxietyRanger]

Agreed with @JRMW's speculation.

 

[Shock-On-T]

I don't like this move. Better to NOT have a jump between car lines. Its better to be closer. Hence BMW 1,3,5,7 series. 325, 335. etc.How many of us were willing to spend money on a lower version item, to only get just close enough to self justify the next model up?
F'it i'm already spending XXXXX, what just a little xxxx more?

I'd rather they drop it because the 75 and 75D is replacing it, and to make room for the 100D and the next battery jump. Keeping the entry level the same price point.

The top spec M3 might be same price as the current S60.