So why so many people disagree that a smart business thing to do would be to adjust Model 3 prices to equalize demand with production capacity and maximize profit? 2 possible reasons come to mind: 1) they just want cheap stuff over Tesla profitability, 2) they don't really think demand outpaces production
So if demand does exceed production capacity, you agree Tesla should increase price to balance demand with production and increase profit as a means to an end?
Making profit would definitely give them more resources to accelerate word's transition to sustainable transport (maybe build more factories to meet the large demand people claim they cannot meet today). Raising prices would not penalize early adopters, it would actually reward them by raising their used car values. As for their promise of $35K car, well, Elon made a lot of promises he never kept, one more is not going to hurt his credibility any.
Because the normal business thing to do is to maximize profit, which Tesla doesn't want to do because they want to build as many EVs+PVs+Storage as possible. Tesla needs to make enough profit to show their business model is viable to wall street for investment, but they don't want to maximize profit because that would limit EVs+PVs+Storage.
And that usually requires investment in factories, machinery, worker training, etc - in other words "money", which they can either get from profit, borrowing, or raising more money. Profit is preferable from business standpoint, hence my point about maximizing profit to bring in money to expand production is the best course of action, ASSUMING that in fact demand significantly outstrips production and is expected to at least stay at that level (or else builing new factory makes no sense).
In the real world money is needed to expand production capacity, and money comes from profit, unless you think there is some Tesla charity out there which will fund the production expansion (obviously the money is not coming from investors if profit is not a goal, investors only invest in things expected to bring a return).
Money can come from profit, but with that structure you only grow as fast as your profit. If a company gets money from the market, they can grow faster even if they don't initially turn out profits, which is what Tesla and many other companies do. Profit is the ultimate goal, but the idea with growth companies is that investors are trading periodic profit in the near future for larger, less frequent gains in the distant future, with a corresponding increase in volatility and possibly risk.
The higher the risk, the higher the expected reward. Investors are, well, investing, meaning they need to make a return. Market is not a charity funding acceleration to sustainable transportation. If Tesla wants to break even in order to bring as many EV's into this world as possible, they will have to do it from profit alone, as no investor will give them any money.
Investors have already given them a lot of money, and I imagine they could raise more if they wanted to. With the amount of cash they have at this point, they can expand without raising prices to maximize profit.
Whatever production expansion rate they can afford now, they can expand faster (build more factories) if they had more profit. They could also afford to expand parts and service which they need already.
I would be asking myself why my plaid is worth $165K when there are inventory vehicles available directly from Tesla at retail.
Sounds like you are making assumptions that are incorrect. I paid for the car, tax, private delivery, and tinting and home charger and charger wiring. Just trying to get most of my money back.
I guess I don’t understand what you’re trying to accomplish then.
Well it’s a good thing that I don’t care and it doesn’t matter at all if you understand. Nobody asked you for your opinion or comments.
On the flip side of that coin, no one wants you to try and flip your car here. Parasites who join the forums to make a buck usually don’t stick around long.Well it’s a good thing that I don’t care and it doesn’t matter at all if you understand. Nobody asked you for your opinion or comments.
Is this all you do is sit on your computer and go back and forth about a car that you aren’t going to buy? It sure seems like it from the amount of comments that you have. womp womp. That’s sad.
Go outside and drive your car around and leave me alone. I don’t want your advice or comments.
Like I said. I waited for a long time and then the car arrived when I don’t need it so I registered on a Tesla forum to try and sell it.
