Tesla Unveils The Model S 60 at $66K..... effects on the Model 3

[ModelNforNerd]

If they start putting batteries, into cars, that aren't being used, they had better not, not once, be limited in production because of lack of batteries. If my Model ≡ is delayed so some Model S owner can carry around the dead weight baggage of my batteries, I will be more than a little annoyed.

Thank you kindly.

The free market economy dictates that you can take your money anywhere you want.

If you're that upset about it, do so.

I just hope you were ahead of me in line.

Thank you kindly.

 

[diamond.g]

If they start putting batteries, into cars, that aren't being used, they had better not, not once, be limited in production because of lack of batteries. If my Model ≡ is delayed so some Model S owner can carry around the dead weight baggage of my batteries, I will be more than a little annoyed.

Thank you kindly.

Will the existing S and X packs take the 20700 cell?

 

[182RG]

If they start putting batteries, into cars, that aren't being used, they had better not, not once, be limited in production because of lack of batteries. If my Model ≡ is delayed so some Model S owner can carry around the dead weight baggage of my batteries, I will be more than a little annoyed.

Thank you kindly.

I can't wait for the entertainment on TMC in a couple of years when the $35K base model crowd is crying over the highly optioned crowd getting pulled to the front of the delivery line for Model 3s. Captialism's a bitch, ain't it?

 

[ModelNforNerd]

I can't wait for the entertainment on TMC in a couple of years when the $35K base model crowd is crying over the highly optioned crowd getting pulled to the front of the delivery line for Model 3s. Captialism's a bitch, ain't it?

I don't normally like to be "that guy".....

but i'll post all sorts of pics of me driving around in my Model 3.

 

[182RG]

I don't normally like to be "that guy".....

but i'll post all sorts of pics of me driving around in my Model 3.

Good luck. Building low margin stripped down Model 3's ahead of orders for higher margin vehicles is fodder for shareholder lawsuits. Passing up on increased revenue is malfeasance for a public company.
Ask the Model X 75 kWh, 5 seat, coil spring "owners" where their cars are? Ask them if newer 90kWh order were pulled ahead of theirs. (The answer is 'Yes' in case you are wondering).

$35K reservation holders are in for a rude awakening over "sequence".

 

[ModelNforNerd]

Good luck. Building low margin stripped down Model 3's ahead of orders for higher margin vehicles is fodder for shareholder lawsuits. Passing up on increased revenue is malfeasance for a public company.
Ask the Model X 75 kWh, 5 seat, coil spring "owners" where their cars are? Ask them if newer 90kWh order were pulled ahead of theirs. (The answer is 'Yes' in case you are wondering).

$35K reservation holders are in for a rude awakening over "sequence".

I'm not getting a stripped down one, was my point.

I'll be in a highly optioned one, while everyone who's only ponying up $35K complains on the forums about A: not having their car and B: what it doesn't come with at that price point.

If you want cooler/better things, you have to spend the money. That's how it works.

 

[Booga]

Good luck. Building low margin stripped down Model 3's ahead of orders for higher margin vehicles is fodder for shareholder lawsuits. Passing up on increased revenue is malfeasance for a public company.
Ask the Model X 75 kWh, 5 seat, coil spring "owners" where their cars are? Ask them if newer 90kWh order were pulled ahead of theirs. (The answer is 'Yes' in case you are wondering).

$35K reservation holders are in for a rude awakening over "sequence".

Uhh.... what? Please, explain this to me.

That increased revenue is simply a matter of timing, and if you believe that the markets are rational and not short-term oriented, then the order doesn't matter. You never hear Buffett say, "Gee, if only back in 1969 Coca Cola prioritized production of X to people who bought the limited editions." In the long term, it doesn't matter, and it could be argued that treating people fairly is good for the brand name and reputation of the firm, like increasing the warranty on the drive units for the Model S retroactively. It cost the shareholders money, but it was still the right thing to do even from the perspective of a shareholder.

 

[N5329K]

If they start putting batteries, into cars, that aren't being used, they had better not, not once, be limited in production because of lack of batteries. If my Model ≡ is delayed so some Model S owner can carry around the dead weight baggage of my batteries, I will be more than a little annoyed.

Thank you kindly.

I doubt the bottleneck will be batteries. By then the beta test issues at the GF will be mostly resolved, but the beta test issues for the M3 will just be appearing. That's going to be the bottleneck. You might have the option of an earlier delivery of a car with some issues, or a deferred delivery of a car without them. Or, as in the MX, they stick to the production schedule and you get to be an outsourced division of Tesla's QC department.
Don't think that would work so well with the vehicle numbers we're seeing. Just imagine having to answer phones at the Service Center. But that is how Silicon Valley usually operates, so who knows?
Robin

 

[xav-]

For some, sure. For me, well let's think about it, for the same amount of money (speculating of course):

• maximum range vs minimum range
  • Something that most likely is enough even in winter vs something that will most likely not be enough during winter (long trip cases of course, daily driving is same for both)
• some options vs no options at all
  • so no AWD, AP, winter package etc
• more reasonable sized car vs a tad big car
  • to be fair, I'm sure the S isn't too much trouble but still

Just from the top of my mind, I'll keep on saving money (for more options) and wait patiently. And like I started my post, for some this is probably excellent deal, which is great. More choices for customers is good.

I know I face the same challenges hehe. I do think though that yes the S is big but it's a hatch. The 3 has a closed trunk. Trunk will be a step back for many if not most Europeans.

 

[ModelNforNerd]

Uhh.... what? Please, explain this to me.

That increased revenue is simply a matter of timing, and if you believe that the markets are rational and not short-term oriented, then the order doesn't matter. You never hear Buffett say, "Gee, if only back in 1969 Coca Cola prioritized production of X to people who bought the limited editions." In the long term, it doesn't matter, and it could be argued that treating people fairly is good for the brand name and reputation of the firm, like increasing the warranty on the drive units for the Model S retroactively. It cost the shareholders money, but it was still the right thing to do even from the perspective of a shareholder.

while you may not agree with it, Elon has already said this is how it's going to be.

\_(ツ)_/¯

 

[182RG]

I don't normally like to be "that guy".....

but i'll post all sorts of pics of me driving around in my Model 3.

Good luck. Building low margin stripped down Model 3's ahead of orders for higher margin vehicles is fodder for shareholder lawsuits. Passing up on increased revenue is malfeasance for a public company.
Ask the Model X 75 kWh, 5 seat, coil spring "owners" where their cars are? Ask them if newer 90kWh order were pulled ahead of theirs. (The answer is 'Yes' I. Case you are wondering).

$35K reservation holders are in for a rude awakening over "sequenc

Uhh.... what? Please, explain this to me.

That increased revenue is simply a matter of timing, and if you believe that the markets are rational and not short-term oriented, then the order doesn't matter. You never hear Buffett say, "Gee, if only back in 1969 Coca Cola prioritized production of X to people who bought the limited editions." In the long term, it doesn't matter, and it could be argued that treating people fairly is good for the brand name and reputation of the firm, like increasing the warranty on the drive units for the Model S retroactively. It cost the shareholders money, but it was still the right thing to do even from the perspective of a shareholder.

In the potential volumes we're talking about, it matters greatly. "Fair" and "Capitalism" don't blend. What the market will bear matters the most. After Employees, revenue contribution will be the #1 criteria for production scheduling. I promise you this.

Tesla, in net, is losing money on every car they build. Maximizing rev$ is their #1 financial priority.

 

[ModelNforNerd]

Good luck. Building low margin stripped down Model 3's ahead of orders for higher margin vehicles is fodder for shareholder lawsuits. Passing up on increased revenue is malfeasance for a public company.
Ask the Model X 75 kWh, 5 seat, coil spring "owners" where their cars are? Ask them if newer 90kWh order were pulled ahead of theirs. (The answer is 'Yes' I. Case you are wondering).

$35K reservation holders are in for a rude awakening over "sequenc


In the potential volumes we're talking about, it matters greatly. "Fair" and "Capitalism" don't blend. What the market will bear matters the most. After Employees, revenue contribution will be the #1 criteria for production scheduling. I promise you this.

Tesla, in net, is losing money on every car they build. Maximizing rev$ is their #1 financial priority.

it's been mentioned MULTIPLE times that Tesla will be attempting to make back their tooling costs with higher margin vehicles first.

 

[neroden]

Tesla, in net, is losing money on every car they build.

I flag people who say this because it shows a misunderstanding of the economic concepts of "fixed costs" and overhead". It's arrant nonsense.

Tesla is making money on every car they build. Lots of money. Unfortunately, they're spending way more than that on overhead and other fixed costs, so they're losing money overall. Obviously they have a strong incentive to increase volume production, and to put higher-margin cars ahead of the lower-margin cars. But it's just arrant nonense to say "losing money on every car".

 

[neroden]

I doubt the bottleneck will be batteries. By then the beta test issues at the GF will be mostly resolved, but the beta test issues for the M3 will just be appearing. That's going to be the bottleneck. You might have the option of an earlier delivery of a car with some issues, or a deferred delivery of a car without them. Or, as in the MX, they stick to the production schedule and you get to be an outsourced division of Tesla's QC department.
Don't think that would work so well with the vehicle numbers we're seeing. Just imagine having to answer phones at the Service Center. But that is how Silicon Valley usually operates, so who knows?
Robin

Yeah, this is actually what worries me, because it's the one scenario which could harm the *brand value*.

 

[182RG]

I flag people who say this because it shows a misunderstanding of the economic concepts of "fixed costs" and overhead". It's arrant nonsense.

Tesla is making money on every car they build. Lots of money. Unfortunately, they're spending way more than that on overhead and other fixed costs, so they're losing money overall. Obviously they have a strong incentive to increase volume production.

You apparently missed the phrase "in net" in my response. I get "finance" dude, really I do, probably better than you. It's not "arrant nonsense" in the real world.

 

[neroden]

So, another thought on the effect of the S60 on the Model 3.

I think Tesla is testing the market at this range. Remember the Model 3 is supposed to have about the same base range. If the market at this range proves to be quite small, I suspect Tesla will make a serious effort to have a higher range for the base Model 3.

 

[Booga]

while you may not agree with it, Elon has already said this is how it's going to be.

\_(ツ)_/¯

For the Model 3, or just based on history with the X and S?

 

[neroden]

You apparently missed the phrase "in net" in my response. I get "finance" dude, really I do, probably better than you. It's not "arrant nonsense" in the real world.

It's a bad and misleading way to say it, so you should say it differently. "Losing money on each car" has the implication that producing another car will lose more money, which is not true. "In net" can be understood to include the net variable costs only (such as warranty reserve and other deferred costs), which often don't show up in gross numbers. If you understand the situation accurately, you should phrase it differently. "Tesla loses money overall" is accurate. "Tesla loses money on each car" is misleading.

Given that I make my living off investing, and according to your profile, you do not, I do not think it would be safe for you to bet that you understand finance better than I do, though perhaps you understand it equally well.

 

[182RG]

Given that I make my living off investing, and according to your profile, you do not, I do not think it would be safe for you to bet that you understand finance better than I do, though perhaps you understand it equally well.

Agreed. Perspective. I make my living on the C level manufacturing, GAAP, rational side of the equation. Tesla is challenging the platform. I'm used to public company, S & OP, traditional methods. It will be very interesting, the next few years......

 

[neroden]

Agreed. Perspective. I make my living on the C level manufacturing, GAAP, rational side of the equation.

Heh, yeah, it's totally fair to call your side the rational side, and the investing side the irrational side! I always tell people there's a lot of psychology involved in investing...