If you are waiting to place an order until the price drops then you could be waiting a LONG time.
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Model Y price cut may come when demand is satiated?
- Thread starter Terminator857
- Start date
Prices will go down eventually. Not just because of increased manufacturing output meeting demand, but because of good old capitalism, no different than the out-of-control new and used car prices we see today. Inflation like what recently has occurred (regardless of your political beliefs) should be temporary due to unprecedented circumstances. Supply and demand is impacting new/used car prices more intensely than inflation. At some point, and my guess is within 12-18 months, it will be harder to sell a $60K MYLR against $35K-50K BEVs with comparable range and features. Not everyone wants or needs AWD, sub-5 second 0-60, or will buy a Tesla because of the Supercharging network (especially if it is opened up to other brands). Tesla has a solid track record of dropping prices by thousands for every model. My 2-week old 2020 MYLR suddenly went from $52,900 to $49,900, and dropped another $1K sometime after that. IMO, our MYs are overpriced at $60K against the competition. FSD is astronomically overpriced for its stage in its development cycle. Ford, VW and Hyundia/Kia are solid competitors. For some of us, even without 'market adjustment', which will end, there will be incentives one day. And dealers will and must compete on price if they want to stay in business, which is the only good thing about the legacy dealer network. At a minimum, thousands of buyers of these brands are eligible for corporate discount plans that will bring the price down further. On top of this, there is no guarantee there will be future reinstated tax incentives for Tesla, so Tesla will have that fact to content with.
You mean that it's gone down in terms of actual dollars , not just inflation adjusted ones? Not sure what your point is exactly but your assertion that "nothing every goes down" is incorrect. Prices for many grocery items move up and down all the time.
Perhaps you've never taken a college level Econ course, or been exposed to the concept of price elasticity.
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Price Elasticity of Demand: Meaning, Types, and Factors That Impact It
Price elasticity of demand is a measure of the change in the demand for a product in relation to a change in its price.
The wildcard right now is that we're in a fairly high inflationary period, along with significant supply constraints. It seems doubtful Tesla will need to lower prices until more supply (their own + competition) sates demand.
I don't think they'll lower prices on existing vehicles and disagree with this "race to the bottom" theory for EV prices.
I expect they'll introduce a lower priced model, likely cheaper than a Model 3 - and ultimately end up with a lineup of low, medium and higher priced vehicles (similar to the BMW approach with a 3, 5 and 7 series models).
And let's be honest, Tesla is an aspirational brand and can afford to charge a premium - Hyundai and Ford are definitely not.
I expect they'll introduce a lower priced model, likely cheaper than a Model 3 - and ultimately end up with a lineup of low, medium and higher priced vehicles (similar to the BMW approach with a 3, 5 and 7 series models).
And let's be honest, Tesla is an aspirational brand and can afford to charge a premium - Hyundai and Ford are definitely not.
Right now, Tesla has priced their cars to return a profit. They have just invested $$$$ in new factories in Germany and Texas. These huge expenses are partially to satisify demand, but also to make the cars quicker and less expensive to produce. Those huge Giga Presses are a good example. Costs $$ now but will save $$$ along the production cycle.
At a certain point, used quality EVs will command higher prices than gassers. Few cities will allow gassers in their city centers and the price of gasoline might make ownership more expensive.
When EVs cost less than gassers, few will want to pay extra to get a gasser.
At a certain point, used quality EVs will command higher prices than gassers. Few cities will allow gassers in their city centers and the price of gasoline might make ownership more expensive.
When EVs cost less than gassers, few will want to pay extra to get a gasser.
Don't hold your breath. Inflation of 12-13% over a 2 year period means price increases are likely here to stay. Considering lithium/battery, chipnand other resource shortages will persist at least some for quite a while... don't expect a price cut.
If anything I think they'll unlock more range, add a few more features and use it as an excuse to increase prices yet again.
If anything I think they'll unlock more range, add a few more features and use it as an excuse to increase prices yet again.
I’m with this post.
If you want the vehicle, buy it. If you are waiting for a lower price then you will be disappointed or waiting a long time and end up with a different vehicle. Something smaller or with less features.
As long as global supply chains and shipping are constrained, Tesla will continue to exploit the rest of the auto industry struggling to deliver cars. If you are the only one capable of delivering quarter after quarter, why would you ever reduce the price?
Supply/demand/market-share/competition... maximum profit equals more rockets to space
Supply/demand/market-share/competition... maximum profit equals more rockets to space
Over the long haul, no, but over short periods of time prices fall pretty regularly. This happens for everything from Milk and Gasoline, to Tesla vehicles. It wasn't that long ago that the price of basically all Tesla models was trending down for a while.
Put another way, it isn't crazy to think a high probability of price decreases in 1 - 3 years. It probably is crazy to think they will be lower in 20 years, though. Inflation always wins the long game.
You never know. When I ordered my MYLR in June 2020, after I placed my order, and while I was waiting for a VIN, the price dropped $3K. FSD also went up by $1K, to $8,000. Tesla honored the new price but stated I also had to take the new price for FSD, which I did...and still saved $2K. If you just follow along, you'll see the prices change a lot; lately it's been up and up...but we also have the manufacturing challenges, such as chip shortages and extremely high demand. Once Giga Texas and Berlin start kicking out full production, eventually I anticipate the supply will begin to eat into the high demand and prices may come down.
While Tesla has a history of price cuts, I don't anticipate any price cuts till 2024 at the earliest when supply chain displays some level of normalcy. Every vehicle manufacturer is rising their prices and Tesla has a massive backlog (even if you exclude Cybertrucks) and with GigaAustin ramping up + 4680 battery cell (which, let's be clear, Elon did mention it was developed for margin improvement) it'll take a good 18-24 months to catch up to demand.
Good news for EV buyers is there will be a plethora of options coming out by other brands which gives customers many more options; competition is healthy and I anticipate Tesla to maintain the lead however. When the competition has "caught" up, given Tesla does not have EV credits, I would anticipate Tesla to use the pricing lever. That said, Tesla is pretty far ahead of the gam.
In summary, they won't lower prices because of
- Genuine continuous improvement (i.e. AMD ryzen cpu's)
- Supply chain uncertainty and rising cost of material + labor (i.e. Tesla does not have 0 employee attrition)
- Significant backlog of vehicles sold at the higher price; until manufacturing catches up, no incentive to lower price
- It's Elon, he doesn't have to
Good news for EV buyers is there will be a plethora of options coming out by other brands which gives customers many more options; competition is healthy and I anticipate Tesla to maintain the lead however. When the competition has "caught" up, given Tesla does not have EV credits, I would anticipate Tesla to use the pricing lever. That said, Tesla is pretty far ahead of the gam.
In summary, they won't lower prices because of
- Genuine continuous improvement (i.e. AMD ryzen cpu's)
- Supply chain uncertainty and rising cost of material + labor (i.e. Tesla does not have 0 employee attrition)
- Significant backlog of vehicles sold at the higher price; until manufacturing catches up, no incentive to lower price
- It's Elon, he doesn't have to
You may be right it may be 2024, but I can't foresee as it "never happening". If I had to buy another MYLR today, I couldn't stomach paying $7K more for the same car I purchased 18+ months ago. A heated steering wheel and bio-defense mode isn't worth that kind of price increase. If the 4680 + structural pack brings increased range and charging performance, I could see this helping justify the case, but that assumes yet another price hike isn't in the works. Having owned many cars, including my MYLR, I maintain that the MYLR does not justify a $60K+ price tag, and will have a tough time overcoming ICE competition as supply chain issues work themselves out. Most studies show that the vast majority of US buyers are still not interested in BEVs no matter how much the government attempts to subsidize. Buyers will continue to flock to brands who offer more traditional creature comforts, convenience, and style for the same or less price until BEVs are truly on par with ICE. No matter how passionate about BEVs we are on this forum, that time is still years from now in the US.
ZenRockGarden
Active Member
Given the thousands-over-MSRP being seen at almost all viable competitors due to their dealer networks, I simply don't see any market pressure on Tesla to reduce prices, and the line isn't getting shorter.
Texas will help them make it -less- of a wait for a Model Y, and then when it gets comfortable they'll pivot to CyberTrucks
Texas will help them make it -less- of a wait for a Model Y, and then when it gets comfortable they'll pivot to CyberTrucks
Hah that was one thing I was going to mention...it has been many weeks since Tesla raised their prices, wondering when/if the next one will be. Like, currently with the MYLR at $59k I thought it'd deter a lot of buyers. But from this forum and Reddit posts, clearly not....
Economics/Finance 101. Would you discount an item at your store that just keeps flying off the shelf? Not just that, people are putting cash money down to get in line? I think not. Think about how much $250 x 250,0000 units/qtr is in non-refundable deposits. Yes, Tesla is laughing all the to the bank right now.
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