[Poll] - Will online-sale only model succeed?

[Merrill]

One of the many things I love about Tesla was no salesman needed, order at home on your computer. If you do the research you do not need anyone to help you, you will still be able to see and drive one.

 

[Eric714]

I would have to assume that it would still be a high-touch online sale. Other than the test drive, I could have done everything online.

 

[P100D_Me]

Hmm...but price cuts is normal for any new technology products though.

This isn't a price cut, this is a price massacre with no regard for anyone that has supported them up to this point. A Tesla car used to be a safe bet for resale value, now it is trashed by the company themselves.
I'm waiting for Elon to do a late night infomerical shouting, I've slashed prices,.not 10%, not 20%, but 30% offf!!

 

[gnuarm]

I'm not sure why this is really a question, Tesla has essentially ALWAYS been an online only ordering organization. Even when you go into a store, they just give you a web browser to go online to order.

1) You do it online, as has been the case.
2) You do it at the Delivery Center, as they've been doing
3) Either at the delivery center or delivered directly to your house.
4) I didn't sit in one before I ordered it.
5) The same as it is.

It is really obvious that you never have had any dealing with Tesla, VERY FEW people have a "store" near them. Remember, Tesla doesn't use dealers, there stores weren't dealers. The stores were only showrooms.

Obviously there will be something different... or they wouldn't be able to lay off anyone! I dug around on the web site quite a bit and I nosed around other places on the web. I did go in for a test drive and a second test drive months later. If there are no sales people, who would be setting up test drives and going with you? Will there be no test drives? I think this is what Musk is picturing. He keeps talking about how many people bought Teslas without a test drive. But that is going to happen less and less.

Personally, I think the next year or two are going to be more critical than even 2018 was. While they were trying to get one car into high volume production in 2017/2018, they will be trying to translate production to a foreign country in 2019 and start new production of a new car in Nevada by 2020. I'm thinking these will be tougher hurtles or no easier than the model 3 ramp. I don't see sales increasing without a sales force. They've already said not to expect profits in Q1. I'm not hearing much good news.

 

[gnuarm]

I actually think Tesla announcing to the world that they are going to online-only sales would only make the dealership association join forces to stop all online-sales in all US states through legislation. Tesla should have transition to "online-only" model in "secrets" gradually in the next few years.

You aren't smelling the fear in Musk's announcement. They are laying off people to cut costs so they can sell the model 3 at $35,000 and not lose their shirt. They chose the sales department to shut down because Musk could delude himself into thinking they don't matter. This is not an uncommon mistake in companies hurting for money. It often ends badly.

 

[scottf200]

I personally think the online only model will be a massive fail. Here are some of the concerns that I have:
1. Where will customer go when they need to trade in their old car?
2. Who is going to handle the paper work with licensing/ registration/ loan and leasing documents from bank etc? Customer and Tesla have to mail this back and forth to each other through UPS or Fedex now?
3. Where will customer go to pick up their car? Tesla will deliver the car to customer at their residential address? If it is the case, it would end up to be hugely more expensive than the store model.
4. For customers who has never heard of Tesla (there are still tons of them), where will they go to see or sit inside a Tesla? Moving store away from shopping center/ high-foot traffic area will only make the brand awareness get worse over time.
5. Given the occasional horrible Tesla customer services that you hear all the time, even at its current store model (email being ignored, phone calls are answered but never get followed up and never do things that are promised), what will the online-sale experience be like? many times worse than the current situation?

Note 78% already.

Last year, 78% of all Model 3 orders were placed online, rather than in a store, and 82% of customers bought their Model 3 without ever having taken a test drive. Customers can now buy a Tesla in North America via their phone in about 1 minute, and that capability will soon be extended worldwide. We are also making it much easier to try out and return a Tesla without a test drive. You can now return a car within 7 days or 1,000 miles for a full refund. Customers are becoming increasingly comfortable making purchases online, and that is especially true for Tesla — which is a testament to the products we make.

Via: Elon Musk just sent this memo to employees about the cheaper Model 3 and store closures

 

[thegruf]

online sale model will "succeed" as this will be the only model available.

However, as Tesla move from an enthusiast to regular customer base what will be unknown is what sales could have been by having stores too.

I'm just not convinced that Tesla aren't firing all their bullets before competition arrives.
A smarter strategy surely is to wait for the imminent launch by a serious competitor and then pull the rug out from them with a strategic announcement that grabs the headlines and disorientates the competitor.

The way they are doing it now just given the competition time to adjust models/marketing strategy prior to their launch.
I have long viewed Tesla sales divison as critically flawed. Nothing here changes that view.

 

[gnuarm]

Note 78% already.

Via: Elon Musk just sent this memo to employees about the cheaper Model 3 and store closures

Yep, those numbers apply to previous sales. Sales that were driven by the massive media hype from the new things Musk was doing. New car, new reservation, new... whatever. This stuff isn't new anymore. It will have a less significant impact and I don't see the model Y garnering the same level of... let's call it "enthusiasm". Sure, it will be a popular car and will likely sell well. But as Teslas intrude more and more into mainstream buyers, you can be pretty sure fewer and fewer of them will want to buy a car with so many eccentricities without even a test drive! I think many in the US and likely elsewhere will not be interested in buying online. Heck, they almost wouldn't take my money when I bought the thing in person. How do you pay online for something so expensive?

 

[immolated]

1. Where will customer go when they need to trade in their old car?

There will still be service centers.

2. Who is going to handle the paper work with licensing/ registration/ loan and leasing documents from bank etc? Customer and Tesla have to mail this back and forth to each other through UPS or Fedex now?

There will still be service centers.

3. Where will customer go to pick up their car? Tesla will deliver the car to customer at their residential address? If it is the case, it would end up to be hugely more expensive than the store model.

There will still be service centers.

4. For customers who has never heard of Tesla (there are still tons of them), where will they go to see or sit inside a Tesla? Moving store away from shopping center/ high-foot traffic area will only make the brand awareness get worse over time.

There will still be service centers.

Honestly I'm getting tired of all these posts from random people who think they have smarter business sense than Tesla. You actually think they're just going to close everything and one day say "Whoops no one can sign paperwork or pick up their car anymore, we messed up" ?? Really??!

I never even visited a mall store once. I went to my local service center showroom to sit in the display models, schedule a test drive, and pick up my car.

 

[henderrj]

1.

Honestly I'm getting tired of all these posts from random people who think they have smarter business sense than Tesla.

"Random people", who've been on this forum for years. Some of them with thousands of replies. These are people who thought about this for a long time, not people who have, and I don't mean any disrespect, but less than a hundred replies.

I've been on this forum a long time and most of the people who contributed a lot, in thought and ideas, aren't here anymore. The excitement for Tesla is both shifting and changing. It is also diminishing too a dramatic degree. But that's not surprising as we are getting past the early adopter stage. Okay, we're well past it.

I'd also be interested to know if you own a model 3, as that seems to be the people who love to order online. The models s and x, and certainly the Sportster, probably the pickup, are going to need test drives.

Elon listens to whoever tells him how wonderful he is, understand I'm an Elon fan, but this is his greatest weakness. He has a deep psychological need for acceptance and for acclimation. He responds to it absolutely. It's not a desire, it's a deep-seated need. This is why he makes decisions like this. He has to have a constant flow of people telling him how wonderful everything is going to be or he can't handle it. Again, I've been a Tesla fan for many years, but the reality is there.

I think they're going to have to bring back the award program, in an abbreviated form, but they're going to have to bring it back. Besides, it's a good idea. Additionally look for new push announcement. Vehicles, batteries, whatever. It's going to be fairly constant for a while again. That'll keep sales going for a while.

But, for the very expensive luxury cars, they're going to have to bring back salespeople. Otherwise Audi and Mercedes will simply blow Tesla out of the water. And not a little, completely remove them from the market.

Then again, that may be the plan. Elon's need to be seen as hugely egalitarian, the ultimate current complement or put down, probably drives him to want to see the model 3 and Y succeed more than anything else. And, if they don't do an upgrade on the S and X they might as well quit making them anyway. It's not going to be that long until the competition will be fierce. Five years at the absolute outside.

 

[svp6]

Note 78% already.

Via: Elon Musk just sent this memo to employees about the cheaper Model 3 and store closures

But that is not reflecting current situation. We bought 2 model 3s last year - RWD in February and P3D- in September. We did not take a "test drive" in either of them. For the first purchase, simply because there were no test drive cars in Minnesota before we took delivery. I trusted Tesla after my P85D - which I ordered just because a very knowledgeable sales person. The second model 3 purchase is "without a test drive" but after driving the LR RWD for 6 months - so we did not feel we needed a test drive. We also were first day reservation holders. I suspect many buyers in 2018 were in similar position.

Transition to today: other than the hypothetical day 1 reservation holders who were interested in standard 3, and the few who are coming to a lease end or replace their early S and X, prospective buyers are all virtually new to the brand. I am somewhat skeptical that it will work as smooth as advertised. For Tesla's sake, I hope it does.

 

[TheGrimSweeper]

Stores are closing (most not all).

Service Centers are remaining and there will be more of them.

Anything you could previously do at the store, can now be done at service center.

What is all this mass hysteria about?

 

[gnuarm]

Stores are closing (most not all).

Service Centers are remaining and there will be more of them.

Anything you could previously do at the store, can now be done at service center.

What is all this mass hysteria about?

Dude, the only "hysteria" is you. People are just discussing the facts. Why do the Tesla fanbois always have to talk like people are forecasting doom and gloom? Starting an auto company is fraught with peril. Discussing the issues can help people understand the concerns and not be upset by them.

The idea that Tesla can sell millions of cars without having sales centers is a totally radical idea, even more radical than the battery electric vehicle. It will be a hard sell with middle America.

No one here is hysterical about it. People simply don't know the full implications and want to understand it better.

 

[Zythryn]

I can't answer the poll as the question does not apply to Tesla.
Nowhere has Tesla, Musk, or anyone else in control of Tesla, stated they are moving to an online order ONLY model.
Stores are being drawn back, and Service is being expanded, true.
However, Tesla and Musk have stated that some high traffic stores will remain.

As such, the question for the poll is hyperbole to start with.

 

[gnuarm]

I can't answer the poll as the question does not apply to Tesla.
Nowhere has Tesla, Musk, or anyone else in control of Tesla, stated they are moving to an online order ONLY model.
Stores are being drawn back, and Service is being expanded, true.
However, Tesla and Musk have stated that some high traffic stores will remain.

As such, the question for the poll is hyperbole to start with.

Sales are already limited in many markets by the lack of stores. Try buying a Tesla in South Carolina! I had the first one registered in my county. Worse, try getting one serviced! No, they haven't and aren't going to be selling so many Teslas in South Carolina.

 

[immolated]

But, for the very expensive luxury cars, they're going to have to bring back salespeople.

Again, They Will Still Have Service Centers. Service centers have show floors with demo models you can sit in, salespeople to talk to, test drives, etc. Why is this blowing everyone's mind? I didn't even know those little mall shops could do test drives or orders, I did all my sales process through the local service center, half the office area is dedicated to sales at all locations I know of.

I also don't know why my post count has anything to do with how much I've thought about something. Exhibit A: OP has 1325 posts and makes this objectively ridiculous post, with blatant misinformation (i.e. neglecting that people can sign still their paperwork or pick up their new cars at service centers). He is legitimately spreading FUD that people will have to mail forms back and forth and only do residential deliveries. He obviously didn't think about this for "a long time." I suggest you stop looking at post counts and consider the advice of Mark Twain: "It is better to remain silent and be thought a fool than to open one's mouth and remove all doubt."

 

[henderrj]

Again, They Will Still Have Service Centers. Service centers have show floors with demo models you can sit in, salespeople to talk to, test drives, etc. Why is this blowing everyone's mind? I didn't even know those little mall shops could do test drives or orders, I did all my sales process through the local service center, half the office area is dedicated to sales at all locations I know of.

I also don't know why my post count has anything to do with how much I've thought about something. Exhibit A: OP has 1325 posts and makes this objectively ridiculous post, with blatant misinformation (i.e. neglecting that people can sign still their paperwork or pick up their new cars at service centers). He is legitimately spreading FUD that people will have to mail forms back and forth and only do residential deliveries. He obviously didn't think about this for "a long time." I suggest you stop looking at post counts and consider the advice of Mark Twain: "It is better to remain silent and be thought a fool than to open one's mouth and remove all doubt."

So, are we to take it to the car you bought was a model 3? And, did you know that two product announcements have already happened?

Years of thinking beats hours of thinking anytime. Especially group think. I don't know how long you thought about it, I'm just saying that people who have deeply thought about it have ideas that are different from yours, don't discount them just because they're different than you. They've had some time to think about this.

 

[jerry33]

The idea that Tesla can sell millions of cars without having sales centers is a totally radical idea, even more radical than the battery electric vehicle. It will be a hard sell with middle America.

I'm not so sure about that. Even Southern Middle America States like Texas are doing quite well with online only sales and an anti-Tesla government. What's happening here is the commercial equivalent of jury nullification.

 

[gnuarm]

So, are we to take it to the car you bought was a model 3? And, did you know that two product announcements have already happened?

Years of thinking beats hours of thinking anytime. Especially group think. I don't know how long you thought about it, I'm just saying that people who have deeply thought about it have ideas that are different from yours, don't discount them just because they're different than you. They've had some time to think about this.

Lol! You make it sound like Tesla is doing this because it is a good way to sell cars. They are doing this because they are running low on fuel and throwing the seats out of the airplane to keep it flying. Yeah, an airline can fly planes without seats, but they won't sell as many tickets for sure.

In 1 or 2 years they will quietly open new sales offices as they start to make proper profits... if they start to make proper profits.

 

[ggnykk]

Note 78% already.

Via: Elon Musk just sent this memo to employees about the cheaper Model 3 and store closures

I think the 78% that Tesla disclosed didn't explain that some of these sales happened only after the buyer seen the car in person or did a test drive. This figure could be quite misleading.