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The Model S prices will plummet. By mid-2018, Tesla will have discontinued the Model S 75D as well and used Model S 75/75D prices will drop below new Model 3 75/75D prices. There is no way a used Model S with less range is more valuable than a brand new Model 3 with more range.
The main reason the Model S is more expensive than the Model 3 is that the Model S production line is less automated. A big part of the Model S is hand assembled. High prices have nothing to do with Model S being more premium and have everything to do with being unable to reduce prices because of high labor costs.
Elon said when they designed the Model S they were trying to make it work instead of designing it in a way that would make production easy but when they designed the Model 3, easy production was the main concern.
Therefore, the Model S will remain more expensive to produce until they do a complete redesign and they build a completely new production line. Listen here where Elon confirms the Model 3 production line is more automated than the S and X.
The main reason the Model S is more expensive than the Model 3 is that the Model S production line is less automated. A big part of the Model S is hand assembled. High prices have nothing to do with Model S being more premium and have everything to do with being unable to reduce prices because of high labor costs.
Elon said when they designed the Model S they were trying to make it work instead of designing it in a way that would make production easy but when they designed the Model 3, easy production was the main concern.
Therefore, the Model S will remain more expensive to produce until they do a complete redesign and they build a completely new production line. Listen here where Elon confirms the Model 3 production line is more automated than the S and X.
Prices at retail are set by what the customer will pay. A loaded P100D has a much higher margin percentage than the entry Model S.
It's hard to say what Tesla will do with the 75D until we see an interior refresh for the premium line. If the 75D premium interior can be differentiated from the Model 3 premium interior then that model could stay in the lineup. But you are right that if the 75D is close to the primo model 3 then they should have a preference to build the easier model 3.
Tesla doesn't know how buyers will react until they start to sell better model 3.
Model 3 will act like a massive advertising campaign for Model S. People will start to see friends with Model 3 and how they can live with electric charging, but then think wow - if only I could have something more exclusive, with more storage, a proper dashboard and a hatchback. Oh, they do a Model S - now I'd pay 20k more for one of those ...
First off, Model 3 production is going to be very constrained versus demand for quite a while. As people keep making reservations, it probably won't be until mid or even late 2019 that they burn through the waiting list. The earliest Model 3s will probably sell for higher than Ss, simply due to how few will be available on the open market. Until the reservation list is gone, limited availability of 3s will keep S prices up. Also, as Tesla is actively growing the total EV market, even if the S demand drops as a share of total EV sales, it can remain constant in absolute numbers.
Tesla is actively working to differentiate S and 3, as can be seen by changes such as making all Ss air suspension and all 3s coil suspension. Expect more of that - more luxury features on the S that aren't available on the 3. Over the next several years, while Tesla slowly burns through the 3 reservation list, expect work to increase automation of S production, if not outright working to switch it to a new platform. Tesla has worked on a number of cost-saving techniques for the 3, and they're doing even more for the Y (such as tremendous simplification of the wiring harness and elimination of the 12V system). They're going to keep updating their luxury platforms as they continue work on their midrange platforms.
Tesla is actively working to differentiate S and 3, as can be seen by changes such as making all Ss air suspension and all 3s coil suspension. Expect more of that - more luxury features on the S that aren't available on the 3. Over the next several years, while Tesla slowly burns through the 3 reservation list, expect work to increase automation of S production, if not outright working to switch it to a new platform. Tesla has worked on a number of cost-saving techniques for the 3, and they're doing even more for the Y (such as tremendous simplification of the wiring harness and elimination of the 12V system). They're going to keep updating their luxury platforms as they continue work on their midrange platforms.
I seriously doubt that sorry to disagree, but why would someone pay more for less.....you'd just buy a MS!
I disagree. I predict that air suspension will be available on the Model 3 before the Model 3 P75D starts production. I'm expecting the opposite of what you said. In other words, over time, the Model 3 will become more and more premium. There is no way, the Model S can compete against the Model 3.
The Model S has the old design that's difficult to build and it has the older and less automated production line. Also, it has the older battery technology. The only reason why Tesla didn't switch S/X to 2170 cells is that they are holding off that idea until they do a complete redesign on the S/X. They know very well, the S can't survive without a complete redesign and a brand new production line. Those will take 2-3 years.
Here is what people should expect:
- More premium features on the Model 3 over time
- Model S continues with the older battery cell technology for 2 more years
- Model 3 has air suspension option before Model 3 P75D starts production.
- 3.1s 0-60 on the Model 3 P75D.
- As soon as Model 3 P75D starts production, Tesla will make more revenue per quarter on the Model 3 P75D.
- By the end of 2018, Tesla will hit higher gross margins on the Model 3 P75D than the Model S P100D
- The Model 3 85 kWh version will be released before the Model S gets a battery upgrade.
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To be the first one on their block with Tesla's newest car, I would guess. This sort of person may already own an S.
1) Explicitly contradicted by Musk, in multiple statements
2) Illogical (more options = more expense to Tesla)
3) "Model 3 P75D" is something that you made up.
Both Musk, and Tesla, have been very explicit. S and X will continue as luxury models. 3 and Y will be midrange. S and X will have many options. 3 and Y will have few. S and X will have more standard features (incl. air suspension). 3 and Y will not. On and on. There has been no ambiguity on this. Your wishing that Model 3 is going to be "Model S, but cheaper" is not in line with anything that Tesla has stated on the subject. The've had to anti-sell the Model 3 to make this point clear.
S vs. 3, from Tesla:
"Later this year, we will introduce Model 3 - a smaller, simpler and more affordable version of our flagship: Model S. With more range, more acceleration, more power, more interior space and more customization choices, Model S will continue to feature the very best in Tesla technology".
"“We want to be super clear that Model 3 is not version 3 of our car. Model 3 is essentially a smaller, more affordable version of the Model S with fewer features ... Model S will be better than Model 3, as it should be, because it’s a more expensive car.”
- Elon MuskVerified account @elonmusk Mar 24
Model 3 is just a smaller, more affordable version of Model S w less range & power & fewer features. Model S has more advanced technology.
814 replies1,814 retweets9,883 likes
Chaitu @ckalapala Mar 24
less range & power expected. But fewer features weren't expected
2 replies0 retweets8 likes
Wrecks @akaWrecks Mar 24
it will probably be just completely incompatible features, like space for the rear-facing 7-seater option.
1 reply0 retweets8 likes
Elon MuskVerified account @elonmuskReplying to @akaWrecks @ckalapala
Only Model S will have the seven seater option, more cargo space, plus higher range, acceleration, two screens vs one, auto extend handles …
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jelloslug
Active Member
The 3 Series BMW has nothing to do with 7 Series cars and the C Class MB does not poach sales from the S Class. The Model 3 will have very little impact on Model S sales. In fact, the lack of availability of the Model 3 for the foreseeable future will drive use Model S prices for the next 18 months.
Exactly. At least 18 months, because while they burn through the current reservation list, new reservations will be accumulating. Plenty of time for Tesla to enhance the S product line, both in terms of capabilities and manufacturing cost / consumer pricing. As is standard in the automotive industry, new features will appear first at the top end (S/X), and only eventually (if at all) migrate down to the midrange (3/Y).
It's a bit more challenging for Tesla than for gasoline automakers, of course, because 3 is more efficient due to its smaller size and lower drag coefficient. So the batteries that they put in the S won't go as far per unit mass, and don't get as much range per hour on a given charger. They're in a bind because to make the S more valuable, they need it to be roomier, can't afford to sacrifice any style for aero, and yet want more range on it. But they seem to be working to counteract this problem very large pack sizes and rolling out the V3 superchargers, which could even charge a Semi quickly
Still, it'll be hard for them to maintain a range distinction without deliberately hindering the Model 3's range. I think they're eventually going to have to give up on the concept of maintaining a range distinction (after all, gasoline cars don't do that) and simply focus on space and luxury features.
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OK, so what do you expect to see if not a Model 3 P75D? No performance version or Model 3 P70D or something else?
By the way, if you are good at predictions, check out the contest I started here: Tesla Predictions Competition. Two of the polls have closed and two will close before the event but I will add more polls over time.
Such a vehicle might appear eventually (certainly not in the first year), but you can't act like it definitely exists, and with specific stats. As for any performance versions, expect to see the same sort of policy that other automakers use. You can make performance versions of low-end cars (separate models or via options), which can outperform the base versions of your high-end cars, but lack luxury features, and are bested in performance by performance versions of your high-end cars. You can make luxury versions of your low-end cars (separate models or via options), but then they're trounced in performance, and the high end cars can be optioned to even higher levels of luxury. Etc. You always make it so that the base version of the high-end car has something more desirable than the low-end one, even if the low-end ones can be optioned up to better stats.
Applying this to Tesla, you might end up with something like the following for 0-60mph/0-100kph performance:
Model 3: 5.5 seconds baseline, 3 second performance
Model S: 4 second baseline, 2 second performance
The same sort of trend would apply to luxury features. And they'll probably try to do the same with range, although they've got physics working against them. The S will always offer more room, that's not going to change about the S vs. 3 distinction.
Elon confirmed the Performance version with Ludicrous mode here and he tweeted about the production start date here and he talked about the 75 kWh Model 3 battery size here. Therefore I feel pretty good about my Model 3 P75D prediction.
Some people might say, predicting the Model 3 P75D after Elon has tweeted about the 75 kWh battery is nothing special. I agree. After that point, it is already almost confirmed. However, I wrote about it here in December 2016 a few months before Elon mentioned the 75 kWh pack. Also, the Estimator has been displaying P75D since September 2016.
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Some say like BMW 7 vs. 3 or MB S vs. C, that Model S and 3 are not in the same market. I don't think these are valid comparisons and that Model S and 3 are much more in the same market compared to the large vs. small German cars.
I totally agree that BMW 7 and MB S are not in the same market as the BMW 3 or MB C. The smaller German cars are meant to be sports sedans, particularly the 3 series which historically has been the measuring stick of the sports sedan. The large German cars are luxury barges, with the MB S as the measuring stick of any luxury vehicle. The buyers of these vehicles are in different markets, with different priorities and looking for completely different qualities in their cars.
The Model S is not a luxury vehicle. It is a technology vehicle. Instead of oozing luxury (it does not), it oozes technology. And amazingly, it drives like a BMW! The Model 3 essentially has the same technology and is significantly lighter. So it will be equal tech wise but better in terms of driving dynamics! Even if it accelerates slower at each level, it will still drive better just because of the of lighter weight.
Basically unless you must have that space or if the Model 3 turns out to ride like a Toyota Camry (highly unlikely), Model S doesn't really do anything better than a Model 3. Moreover, range is king! And with the same battery, the Model 3 has more range. So you get more range for less money...
I totally agree that BMW 7 and MB S are not in the same market as the BMW 3 or MB C. The smaller German cars are meant to be sports sedans, particularly the 3 series which historically has been the measuring stick of the sports sedan. The large German cars are luxury barges, with the MB S as the measuring stick of any luxury vehicle. The buyers of these vehicles are in different markets, with different priorities and looking for completely different qualities in their cars.
The Model S is not a luxury vehicle. It is a technology vehicle. Instead of oozing luxury (it does not), it oozes technology. And amazingly, it drives like a BMW! The Model 3 essentially has the same technology and is significantly lighter. So it will be equal tech wise but better in terms of driving dynamics! Even if it accelerates slower at each level, it will still drive better just because of the of lighter weight.
Basically unless you must have that space or if the Model 3 turns out to ride like a Toyota Camry (highly unlikely), Model S doesn't really do anything better than a Model 3. Moreover, range is king! And with the same battery, the Model 3 has more range. So you get more range for less money...
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