Tesla releases Model S price for China Market!

[Discoducky]

Today's market reaction will be very telling. I hope Elon gets on Bloomberg or CNBC with a short interview. This announcement for 'fair' pricing will most likely cause a rumble on wall street. I think it is great and really hope there is enough battery supply to meet the demand as well as production capacity at NUMMI. The next earnings announcement will need to avail these concerns.

 

[yobigd20]

Here is why I can't stand the media: Tesla to charge more in China for Model S - Silicon Valley Business Journal

That article got it all wrong. Tesla is **NOT** charging more in China. In fact, it's the exact same price as the US models, and the final price is same as US price + their government taxes. Tesla's point was that the 'normal practice' is to charge almost double the US price, and THEN add the government taxes on it. So Tesla's "risk" is that they are taking a lower profit and selling it much cheaper than they could be. Sigh. The media needs to hire some intelligent people.

 

[Krugerrand]

The media needs to hire some intelligent people.

I suspect they know exactly what they are doing.

- - - Updated - - -

...but why not add some additional profit in?

"...simply because we want to treat our Chinese customers just as well as we'd treat customers in any other country."

No one would have blinked at an extra 5-10k thrown in for their troubles.

That's not the point.

Don't they have to modify it for the market as well?

Sure, just like they modified for the Canadian and European markets, they will also modify for the UK/Japanese/Australian markets, and are modifying for the German market, they will also modify for the Chinese market. And just as they didn't rip off the other markets, they won't be ripping off the Chinese market, not even a measly 5-10k for their troubles.

 

[ckessel]

Hmm. They didn't need to double the price, but why not add some additional profit in? No one would have blinked at an extra 5-10k thrown in for their troubles. Don't they have to modify it for the market as well?

Either way, hope they've got their production constraints worked out...

Tesla has said many times they're goal is to make the same profit on each car no matter where it's sold and that they try to make the way the price of the car is computed as transparent as possible.

Their China pricing is just following through with what they said they were going to do. From a purely financial viewpoint, one could argue they're missing out, but I think it all goes back to Elon's mission of making every car electric. I think it also builds a lot of long term goodwill to Tesla, particularly in what is almost certainly going to ultimately be their largest market.

For me, I'm glad to see Tesla follow through on their earlier strong statements on how they'd planned to do pricing around the world.

Edit: Oh, and remember, Elon's talked about an "executive" version of the Model S specifically in regards to the China market. Given that has no current price, they could start with that puppy's price sky high and still hold to the letter of their "same profit everywhere" motto even if China is really the main market for it.

 

[Owner]

And China has been struggling with huge air pollution issues. So lots of Teslas would be great. Hopefully a lot of solar panel installations too.

 

[AnOutsider]

Tesla has said many times they're goal is to make the same profit on each car no matter where it's sold and that they try to make the way the price of the car is computed as transparent as possible.

Their China pricing is just following through with what they said they were going to do. From a purely financial viewpoint, one could argue they're missing out, but I think it all goes back to Elon's mission of making every car electric. I think it also builds a lot of long term goodwill to Tesla, particularly in what is almost certainly going to ultimately be their largest market.

For me, I'm glad to see Tesla follow through on their earlier strong statements on how they'd planned to do pricing around the world.

Edit: Oh, and remember, Elon's talked about an "executive" version of the Model S specifically in regards to the China market. Given that has no current price, they could start with that puppy's price sky high and still hold to the letter of their "same profit everywhere" motto even if China is really the main market for it.

Makes sense... especially goodwill with the whole tuosule thing. I was just thinking if they were still production constrained and needing cash, that's some low hanging fruit. The executive version is what I was referring to when I said changing it for their market. I was under the impression that in general the Chinese Model S' would be "executive" style vs it being a "trim" level.

 

[ckessel]

Makes sense... especially goodwill with the whole tuosule thing. I was just thinking if they were still production constrained and needing cash, that's some low hanging fruit. The executive version is what I was referring to when I said changing it for their market. I was under the impression that in general the Chinese Model S' would be "executive" style vs it being a "trim" level.

I suspect the initial shipments are the car unchanged from the US market, other than anything that might be related to China regulations.

I think I remember Elon mentioning the executive version will just be a 4-seater, so heavy modifications to the interior, so I'd guess that'd be announced/released down the road a bit? Today's announcement is the foot in the door and the executive model later on is the big money maker?

Just thinking out loud

 

[AMPd]

That's awesome, and I don't think Tesla needs to worry about other car companies trying to convince the public the model s is less of a car, once the public get to test drive the car they'll love it.

 

[AMN]

While there is a large group of Chinese customers that would buy a Tesla at 3x the US cost just because they can showcase it as a status symbol, culturally the Chinese are even more sensitive to being treated with respect. Great PR campaign from Tesla Motors!
Tesla is on a smart mission to concur the world and they are doing it in style. Congrats!

 

[brianman]

Hmm. They didn't need to double the price, but why not add some additional profit in? No one would have blinked at an extra 5-10k thrown in for their troubles. Don't they have to modify it for the market as well?

Primary goal is to move the industry toward EVs. This announcement furthers that agenda in two ways: (1) the Model S in China is more towards the "affordable" offering of Gen 3 than it is in the other markets (except Norway) thus far and (2) this puts pressure on the competition to lower their prices, which cuts into the profit they make in this market.

While I agree the announcement has been in line with their previous statements about pricing and it's a good warm fuzzy kind of PR thing, there's also some larger game strategy here.

 

[Subhuman]

To bad we can't buy a Model S in the USA at half the price of a Mercedes S-class. China pricing is going to be similar to Norway in the fact that a Model S will be significantly less than a comparable ICE vehicle. We are all well aware how that has worked out for Tesla in Norway (#1 Selling Vehicle).

 

[NigelM]

Mod Note: identical topic, threads merged.

 

[772]

Makes sense... especially goodwill with the whole tuosule thing. I was just thinking if they were still production constrained and needing cash, that's some low hanging fruit. The executive version is what I was referring to when I said changing it for their market. I was under the impression that in general the Chinese Model S' would be "executive" style vs it being a "trim" level.

I think they will be production constrained for a while yet. They could charge more, but as a new entrant to the market, pricing it this way captures attention, goodwill, and ultimately, market share. As demand and production expands, their margins will naturally improve.

 

[xdguo]

Tesla has already built a very nice image in China by launching Model S pricing in China when you look at the mass social media reviews and comments! this is a very successful move!!

 

[anticitizen13.7]

My gut feeling is that Model S is going to be a very sought after car in China.

It's big, it looks awesome, it's stupendously fast, it's American, and it has no tailpipe.

Instant status symbol.

 

[Discoducky]

Over the next few days and ongoing it would be awesome to hear from people in China as how this is being received and thanks in advance!

 

[hiroshiy]

So while RHD markets such as Japan, Hong Kong, Australia and U.K. were waiting for their Signature models for more than one year, China was prioritized above those markets for apparent reasons.
Good move for Tesla, but some disappointed reservation holders in such countries incl myself, with no official price announcements yet in RHD markets.

 

[eepic]

So while RHD markets such as Japan, Hong Kong, Australia and U.K. were waiting for their Signature models for more than one year, China was prioritized above those markets for apparent reasons.
Good move for Tesla, but some disappointed reservation holders in such countries incl myself, with no official price announcements yet in RHD markets.

sorry to hear that hiroshiy, must be an agonizing wait if it's any consolation, elon mentioned about two weeks ago that the RHD versions would be ready by about april so hopefully the wait won't be too much longer!

 

[hiroshiy]

@eepic thanks, yes they will annoince pricing for Japan probably next month. Back to the topic, are chinese model Ss European car or American?

 

[Blaze]

Going global. Can production satisfy the world demand. Supercharge networks all over the world. When is my local SC (Oxnard) going to make progress? I admire Tesla, and hope they make perfect choices.