Staggering amount of issues found at/after delivery. Considering returning the car.

[mattjs33]

When I mean Tesla car buyer pressure I mean pressure FOR TESLA to deliver in 2018. Why can’t the buyers who want perfection wait till 2019?

That's not how it works. Tesla declared the Model 3 ready to deliver in volume in 2017, and that it would be the "best car in its class, period". It's ASSUMED the cars will be, while maybe not perfect, but acceptable to what they expect a $50K car to be, quality-wise. It's not the job of the customers to withhold their purchase until Tesla gets its act together, there were no conditions given for the Model 3's on-sale date.

Imagine the same scenario, substituting "GM" for "Tesla", and imagine what the reaction would be on this forum.

By design it will always be a pain the ass. The purchasing process from a traditional dealer is an ADVERSERIAL process. It is a zero sum game. Every dollar I get discounted on is one less dollar for their coffers. If they don’t get their pound of flesh from me they will get it from the next person.
I happen to thrive in scenarios that involve negotiation. However I see the value of treating everyone the same like Tesla does.

Agreed.

Don’t forget also that the dealers make money off service. You wouldn’t want your Tesla service to be a profit making venture for the sellers.

Why not? It works pretty darn well for every other OEM on the planet. And it seems Teslas need a fair bit of service. Don't forget service = parts sales. Wouldn't making money on service, make a dealer more eager to sell the product?

Look, I'm not saying Tesla is blameless here. Clearly the delivery folks and initial managers screwed up majorly. But I seethe at poor comparisons and Monday morning quarterbacking. No one has done what Tesla is doing. Full stop. It's silly to suggest that any of us could do better, or have sufficient info to believe that we know what Tesla should have done better.

No one has done what Tesla is doing, for certain, but there's a hundred years worth of data for why they have not. Tesla laid out a plan, and in doing so should have been able to see the same potential hurdles that I saw (and I'm just an industry observer), way back in 2012. That they didn't, is their management's fault, and that's squarely on them.

If the quarterback fails to see the guy wide open in the end zone and doesn't throw the ball to him, losing the game, it's his fault. Yes, it's MUCH easier for us to watch the replay and see what he didn't see, but it's still HIS JOB to have seen the guy. It's still his fault. Whether WE would have ALSO NOT SEEN the open man, is irrelevant.

 

[Zaxxon]

Again, agree to disagree. You are wildly overestimating your own competence (and that's not an insult, just a fact). I don't think we'll see eye to eye on this, and that's ok.

 

[Dr. J]

Remember also that you have to agree to arbitration if you want to take the car home.

The MVPA says you have 30 days to opt out of arbitration.

 

[voip-ninja]

The MVPA says you have 30 days to opt out of arbitration.

That's correct, but you still have to sign the agreement that you will accept arbitration before you take initial delivery. This is why your best two options when you do final inspection is to either reject the vehicle at that time or get a due bill for the repairs the vehicle needs and accept that your brand new car needs repair.

 

[voip-ninja]

No matter how you want to put the percentage on it, in raw numbers Subaru is building 400K more cars a year than they were just ten years ago. Exactly what Tesla is trying to do. And I don't recall hearing any such growing pains from Subaru customers. In fact I believe Subaru owners are some of the most satisfied (feel free to confirm).

Tesla is a market disruptor. Subaru is not.

Tesla is doing something very similar to what Apple did when they disrupted the cellular phone market 13 years ago, Apple had plenty of bumps on that road too, ultimately though extremely successful at it.

 

[neroden]

Update. They said there's no new car that they can match and I have to place a new order if I want a replacement. So of course now I'm gonna get the money back. Audi e-tron here I come!

So you're willing to wait an extra *year*? *Minimum*?

It would be quicker to place a new order with Tesla! It would be quicker to wait two months, see if Tesla's delivery situation has improved and *then* place a new order with Tesla!

 

[beachbum77]

Long time Audi customer here, I am myself starting to question my decision to give these clowns money.

I put in an order, got in touch with an advisor the next day, sent all paperwork in and made full payment within a few hours. Everything nice and smooth so far. Once they had my money they stopped answering emails. The call center can't give me any actual status on the vehicle, the IDA is AWOL and the local service/delivery center's voicemail is "full and can no longer accept messages".
Based on the trucking receipt I found online, the car has been stuck in Lathrop for almost two months and seems to still be there, in which case there's no way it can make the delivery appointment.

None of this crap ever happened with Audi (or any other brand for that matter).

That's because the others did not ask for prepayment. Once you paid Tesla you lost all leverage. Sorry, but that was your fault.

 

[beachbum77]

Sorry, your spiel re: the pristine wonderfulness of BMW & MB is just nonsense.

I’ve owned both brands, S, E class; X5 (4), x3 (2), 5, 2, 1.

Each and every one has had some issue that needed adjustment, repair etc due to failure. Let see, moonroof leaks, uncontrolled window failures, electronics module failures among others.

Fact is many of them use the same part supplier so it’s a common thread when there is an issue.

Moreover, uncontrolled fires seems to be a big issue for BMW right now.

Things do indeed break on all brands. But how many were delivered to you new with issues even close to what the prof has gone thru on his car? I have bought used CPO Mercedes that were flawless at the time of delivery. My 2008 SL550 is one of them. I have owned it for 8 years now. An SR M3 is going to replace my older '98 SL500 daily driver. If it is not pristine at delivery sometime in 2019 I will be rejecting it. I have zero tolerance for sloppy workmanship or bad prep service. Tesla needs to raise their level to compete with premium brands.

To date, Tesla buyers have been more than tolerant in support of this startup. But those buyers are about exhausted and the more demanding mass-market will not be anywhere near as forgiving.

 

[SoCalGuy]

When I mean Tesla car buyer pressure I mean pressure FOR TESLA to deliver in 2018. Why can’t the buyers who want perfection wait till 2019?


Why people want that I really have no idea. If you are that salty about quality:

Wait till 2019. It’s that simple.

Um, haven't we been over this @MXWing? It's $3750 plus whatever ridiculous price hikes Tesla has done in the last 2 months (my configuration went up $3K).

So for me, it would cost $7K more to wait until 2019 without any assurance that quality in 2019 will be materially better than current cars. Tesla has yet to prove that it can consistently produce the Model 3 at a reasonable level of quality at volume.

Care to ask this question again for a 5th time?

Some people's kids .

 

[beachbum77]

It seems you agree with me that Tesla should prioritize the number of cars that are delivered so the maximum amount of people get the full tax credit? If so, then you would agree with me that quality will suffer as a byproduct.

For the short run which is what we are discussing here:

More quality, more accuracy = slower speed.

More speed = lower quality, lower accuracy.


Speaking for Costa Mesa, Tesla literally has no room in both the service center and the delivery center. Driving on Pullman you will see tons of Tesla's just parked on the side of the roads because there are no parking lots to hold them. The idea of Tesla pulling out a QA factory out of their ass anywhere in SoCal or anywhere before the end of the year is laughable and unrealistic.

Why couldn’t they have done it last year? Well.. they only have 1 billion in cash. They are burning 9000 per minute, and have an EPS of -4.

Who’s going to give them money to pay for this QA center? Not only is no one giving them money but they are pestering Tesla to build 35K Model 3s that give them even less cash to work with.

You would think all the geniuses here that built and sold reasonably successful businessss would know how rapid scaling works.

Unless they were reasonably successful lemonade stands where the end product is fungible from one stand to the next making QA a non issue.

If Tesla was a sports team the advice being given to them here is:

Stop them on defense and score on offense.

Really? No *sugar*.

I described the logistics here:

P3 Costa Mesa Delivery - Admirable effort, considering the challenges.

Tesla has tons and tons of free class flow to finance a delivery center right? How should one interpret the chart @fnce_prof ?

View attachment 336255

Your chart points to the real problem that plagues Tesla: A flawed business model.

It is no secret. The more cars Tesla builds the more money they lose and burn in cash flow. Why?
1) They are trying to be the manufacturer, seller, servicer, and power provider. For Christ's sake, there is not enough profit to cover all of those bases. Their warranties are killing them in electric motor and battery pack replacements.
2) To make matters worse, in their model, used cars are sold at zero profit or a loss. This is a HUGE profit center for new car dealers around the world. But Tesla sees it as unimportant to their "big picture".
3) In order to cut costs, they built a very limited number of delivery centers. Yet expect these centers to deliver dozens of cars a day to keep up with the pace of production here in the U.S. Instead cars are piling up everywhere. Most were not designed to accommodate the current volume of arrivals. Now they are moving to home deliveries with pre-paid cars and full refund options. Home delivery is the most expensive option out there. While doing so will make the Q3 numbers look good, this new idea could end up devastating Q4.

No option will be cheaper than delivering cars in great condition at a delivery center. But Tesla appears to be desperate to record sales of flawed cars just to hit a number by the end of this month, and to hell with the impact on next quarter and beyond. That is a terrible way to run a company with long-term aspirations.

 

[Canuck]

It might be interesting to note, Subaru sold under 200K cars in the US in 2007. Last year they sold over 600K. No one had to "cut them some slack" while they ramped up sales.

Says who? Please post the stats on customer satisfaction since I personally know someone who had to cut Subaru a ton of slack, while cursing them, but unlike you I know the value of anecdotal evidence.

No matter how you want to put the percentage on it, in raw numbers Subaru is building 400K more cars a year than they were just ten years ago. Exactly what Tesla is trying to do. And I don't recall hearing any such growing pains from Subaru customers. In fact I believe Subaru owners are some of the most satisfied (feel free to confirm).

Please, again let's stick to facts. Do we really have to do a rehash of how evidence from anecdotes is seriously flawed?

Here's the facts from a broad view perspective, with valid data from random sampling. It looks to me like Subaru still can't get over its hurdles. 24% of their customers have dumped them -- would not buy again! Nearly 2.5 times worse than Tesla -- in Tesla's first year of sampling! This is the company you use as an example?

Rank Brand Owner Satisfaction
(Average of all models)
2018 2017
1 — Tesla 90
2 — Porsche 85
3 NA Genesis 81
4 ▲ 4 Chrysler 78
5 ▼ 2 Audi 76
6 ▲ 1 Mazda 76
7 ▼ 3 Subaru 76

Car Brands Ranked by Owner Satisfaction

But how many were delivered to you new with issues even close to what the prof has gone thru on his car?

Two Tesla were delivered to me without issues the OP had. Your point? Reaching out for people to validate your point on the internet will get validation by way of anecdotal evidence. Again, not of much use.

 

[MXWing]

Um, haven't we been over this @MXWing? It's $3750 plus whatever ridiculous price hikes Tesla has done in the last 2 months (my configuration went up $3K).

So for me, it would cost $7K more to wait until 2019 without any assurance that quality in 2019 will be materially better than current cars. Tesla has yet to prove that it can consistently produce the Model 3 at a reasonable level of quality at volume.

Care to ask this question again for a 5th time?

Some people's kids .

You don’t have 100% assurance your car in 2018 won’t have a problem. Neither will a car in 2019, or a car in 2020.

Tesla hasn’t been explicit about their strategy in 2019 but any capable economist in their employ would recommend what I predict.

1.) 2018 - Maxmize top line growth while maintaining positive bottom line. Do this at all cost through the shipment of as many vehicles as possible at the highest margins possible. This includes raising prices of options as demand will be price inelastic as the year ends.
2.) In 2019, maintain modest top line growth but stronger emphasis on bottom line growth. This includes producing fewer than max throughput vehicles being mindful of max profit. To achieve this, Tesla’s shifts to quality versus volume. With this said, volume still increases anyway relative to 2018 but quality catches up. SR Model is expected in 2019 and Tesla cannot afford reworks on a lower margin vehicle.

Tesla also raised prices in 2018 because they can. I expect the them to dial back car costs in 2019 to a convenient figure: $3000 cheaper than the same car in Dec 2018.

So yes, quality will be better in 2019. You wouldn’t listen the 5th time anyway so it’s a lost cause to convince you. Others may see what I see however.

 

[MXWing]

Your chart points to the real problem that plagues Tesla: A flawed business model.

It is no secret. The more cars Tesla builds the more money they lose and burn in cash flow. Why?
1) They are trying to be the manufacturer, seller, servicer, and power provider. For Christ's sake, there is not enough profit to cover all of those bases. Their warranties are killing them in electric motor and battery pack replacements.
2) To make matters worse, in their model, used cars are sold at zero profit or a loss. This is a HUGE profit center for new car dealers around the world. But Tesla sees it as unimportant to their "big picture".
3) In order to cut costs, they built a very limited number of delivery centers. Yet expect these centers to deliver dozens of cars a day to keep up with the pace of production here in the U.S. Instead cars are piling up everywhere. Most were not designed to accommodate the current volume of arrivals. Now they are moving to home deliveries with pre-paid cars and full refund options. Home delivery is the most expensive option out there. While doing so will make the Q3 numbers look good, this new idea could end up devastating Q4.

No option will be cheaper than delivering cars in great condition at a delivery center. But Tesla appears to be desperate to record sales of flawed cars just to hit a number by the end of this month, and to hell with the impact on next quarter and beyond. That is a terrible way to run a company with long-term aspirations.

I don’t disagree with you despite being a bull. Where we diverge is you expect this mondus operandi to continue indefinitely.

As I outlined above, I expect it to change.

This is why I preferred and supported Tesla to go private. No games have to be played with quarterly. If Tesla delivers less cars in 2018 than so be it. I’m more worried about bottom line stability versus top line growth.

Q4 I think will be an even bigger madhouse than Q3 as people realize they want a Tesla by end of year over Thanksgiving dinner.

Every Model 3, RWD included and all store cars will be gone by Dec 31st.

No one will be rejecting vins, that’s for sure.

 

[SoCalGuy]

You don’t have 100% assurance your car in 2018 won’t have a problem. Neither will a car in 2019, or a car in 2020.

Tesla hasn’t been explicit about their strategy in 2019 but any capable economist in their employ would recommend what I predict.

1.) 2018 - Maxmize top line growth while maintaining positive bottom line. Do this at all cost through the shipment of as many vehicles as possible at the highest margins possible. This includes raising prices of options as demand will be price inelastic as the year ends.
2.) In 2019, maintain modest top line growth but stronger emphasis on bottom line growth. This includes producing fewer than max throughput vehicles being mindful of max profit. To achieve this, Tesla’s shifts to quality versus volume. With this said, volume still increases anyway relative to 2018 but quality catches up. SR Model is expected in 2019 and Tesla cannot afford reworks on a lower margin vehicle.

Tesla also raised prices in 2018 because they can. I expect the them to dial back car costs in 2019 to a convenient figure: $3000 cheaper than the same car in Dec 2018.

So yes, quality will be better in 2019. You wouldn’t listen the 5th time anyway so it’s a lost cause to convince you. Others may see what I see however.

You're an economist now? LOL.

 

[voip-ninja]

Your chart points to the real problem that plagues Tesla: A flawed business model.

It is no secret. The more cars Tesla builds the more money they lose and burn in cash flow. Why?
1) They are trying to be the manufacturer, seller, servicer, and power provider. For Christ's sake, there is not enough profit to cover all of those bases. Their warranties are killing them in electric motor and battery pack replacements.
2) To make matters worse, in their model, used cars are sold at zero profit or a loss. This is a HUGE profit center for new car dealers around the world. But Tesla sees it as unimportant to their "big picture".
3) In order to cut costs, they built a very limited number of delivery centers. Yet expect these centers to deliver dozens of cars a day to keep up with the pace of production here in the U.S. Instead cars are piling up everywhere. Most were not designed to accommodate the current volume of arrivals. Now they are moving to home deliveries with pre-paid cars and full refund options. Home delivery is the most expensive option out there. While doing so will make the Q3 numbers look good, this new idea could end up devastating Q4.

No option will be cheaper than delivering cars in great condition at a delivery center. But Tesla appears to be desperate to record sales of flawed cars just to hit a number by the end of this month, and to hell with the impact on next quarter and beyond. That is a terrible way to run a company with long-term aspirations.

You should put right in your signature that you hold a short position on Tesla and have written anti-Tesla pieces on Seeking Alpha. Not doing so is extremely disingenuous.

 

[MXWing]

You're an economist now? LOL.

I always was. Both by education and responsibilities.

I have Ahnolds signature on the paper.

 

[SoCalGuy]

I always was. Both by education and responsibilities.

I have Ahnolds signature on the paper.

So a CSU/UC grad who received his degree between 2003-2011 yet has a disdain for the millennial club of which he would find himself a member? Interesting

 

[MXWing]

So a CSU/UC grad who received his degree between 2003-2011 yet has a disdain for the millennial club of which he would find himself a member? Interesting

Not a CSU, but degree is not important anyway - its what you do with it matters most.

Millennial definitions vary. While most include me, I choose to pick the definition that excludes me. My wife is solidly a Millennial however being one year younger. Or they call it the strawberry generation from where she comes from. Bruises easily.

I understand you got upset when I seemingly threw all millennials under the bus. Many things I said are generalizations meant to be funny or sometimes snarky - not to be taken seriously. Or sometimes there are grains of truth in stereotypes. Sorry for the offense on that. It’s self deprecating humor to me anyway.

Bottom line is that OPs delivery experience was pathetic. I’d quit out of principle than shovel *sugar* at a customer. Age of delivery person doesn’t matter.

 

[Krugerrand]

So you're willing to wait an extra *year*? *Minimum*?

It would be quicker to place a new order with Tesla! It would be quicker to wait two months, see if Tesla's delivery situation has improved and *then* place a new order with Tesla!

Nah, it would be better if he wasn’t a Tesla customer. Really. Let Audi deal with him...at least until they are out of business.

 

[RandyS]

I know I'm only one data point, but I took delivery of a red P3D+ a month ago with white seats. I was worried in advance what might be wrong with it upon delivery, and I have to say, other than the due bill for the badge and spoiler, the car was flawless. I mean perfect. I looked it up, down and sideways in the daylight, and drove it away with an awesome Tesla grin...After a month of driving, I love it more than ever....