A fair price is what people are willing to pay for the product at the time. Look at the housing market. Houses can change value by 100k or more over the course of 30 days. Do they go asking the seller for a rebate after? No at the time you thought it was a fair price. Also as per Tesla/Elon the prices are based on anticipated cost of materials, labor, etc when your car will be built and you guessed it....demand. Since demand has dropped the profit/vehicle will go down but supply and demand is a fundamental of capitalism. Welcome to your economics lesson in real life. If you think a price is inflated at a time wait and see what happens before committing.
This is why it gets tricky. You do have a valid point. The issue here with getting the rug pulled from under all of our feet is more unique to the examples given. I get what you're saying, but at the same time there is a greater point here. - We've all been sucker punched, lost a ton of value over night, shafted, slapped in the face as customers who own a Tesla. There's a little more principle at play here than the typical circus in economics.
Not everyone - many more people are ecstatic and snapping up Tesla's at a record rate I expect. As someone else mentioned on another thread, capitalism is great until you're on the wrong end.
And many of those can be the uninformed who just sees a good deal and doesn't know much about cars aside to the badge or buying into the hype. There will always be different motivations for jumping on a good deal.
I can see that scenario playing out. But if this scenario puts you in any sort of financial bind, then perhaps people that could be in that situation should not be purchasing a $70k vehicle....its a luxury/toy....not a necessity.
True. Can't argue that. On the flip side, it still sucks when you get shafted by an extreme move like this by Tesla. Again, this is abnormal and that's what most of the folks here are sour about. Understandable.
The biggest difference is that Tesla has unilateral control over what a new Tesla sells for, not the market. If an agency, for example, engaged in price fixing to control the prices of real estate in a certain market, there would be legal repercussions against that agency. Tesla enjoys nearly monopolistic power in the US EV market; that type of control is something our government has sought to curtail since the Sherman act of 1890. When the major player in a sector makes a huge adjustment that moves the entire sector the FTC absolutely takes notice. Tesla has the right to set their own prices, but I’m sure they’re gonna be required to have a conversation with regulators and explain why they’re doing what they’re doing.
I can't believe that a lot don't understand this. Just baffling.
Rule number 1 when buying a depreciating asset.....dont put yourself on thin ice.
It's true that there are likely a lot of folks who do buy a lot more car than they can afford. The thing is though, in this situation with the price drop, the thin ice was brought onto all of us over night. It's a slap in the face and a punch in the gut whether people want to admit it or not.
Yeah... some people call it a bubble (like tech bubble, housing bubble, tulip bubble, etc.. etc..) Imagine spending your life's fortune only to have a bunch of tulips at the end. Crazy, right? Thank God, I assume you didn't spend your life's fortune, and you still managed to get an awesome car while helping transition away from ICE vehicles.
To be honest, this level of irrationality regarding the drop has shocked me. What it has taught me is that a lot of Tesla buyers seemingly do not know basic economics. Also, to alot of people, Tesla the brand, has been associated with "premium" quality and "exclusivity" which was never Elon's intent for Tesla.
Fair. Teslas are entry level luxury at best.
Does no one remember that all other cars and dealerships were selling new cars OVER MSRP?? And now cars are at or below MSRP? Does no one remember that? Does no one remember used cars selling MORE than new MSRP cars? For example the MB G Wagon?
All those people chose to pay over MSRP or buy expensive used cars because that was the market at the time. Now the market calmed down and more cars are available and prices have dropped across different car brands. So it makes sense that Tesla prices would drop.
I am serious, does no one remember the crazy mark ups?? I recall a friend paying over 20K MRSP for a Toyota Thundra TRD Pro.
You made the choice to make a purchase during the time when market was inflated. It is what it is. It is not just Tesla, it is every other car maker, its just that others have dealership as escape goat.
The difference is, for those that chose to pay $20K over MSRP for an ICE car has no right to complain. You might be thinking, but wait, what about those that paid a Premium for a Tesla before the price drop? Well, name one auto maker that, over night, shafted their customer base like Tesla just did?
It never makes sense to include automobile equity in any calculation of personal wealth (unless the car is a collectible). If you have anything more than a tiny percentage of your financial net worth tied up in a car, then you made a mistake in purchasing it. As everyone knows, they are depreciating assets unlike every other component that makes up net wealth (real estate, stocks, bonds, gold, silver, etc). Sure the other assets may vary up and down in value, but in general the value doesn't go to zero over time.
True. I get that there may be a lot of people here complaining who had to finance their cars, but the point being made about getting shafted is valid, regardless of the financing option one went with.
I never said there was anything wrong with it. Two people in this thread stated that Tesla made no money on financing. That is simply not true.
You’re talking about competition in the broader sense. I’m talking about competition when someone gets it in their mind that a Tesla is aspirational and they really want one. What else are they going to compare it to? When I was looking, I wouldn’t even consider a Mach E or Ioniq 5, etc.
What I’m saying is that it will be interesting to see what happens once there are equivalently advanced, similarly priced and good looking electric vehicles to compete with Tesla that also have recognition and cachet. Today there are none.
Tesla is the Starbucks and Apple. When you're the first at a major scale in something, you inherit a particular perception among the consumers.
Ex. Look at Starbucks coffee... subjective or not, in many reviews the coffee sucks, yet people still buy it and drink it when there are better non-burnt tasting options out there. Look at Apple, went from making solid quality products to disposable junk, yet people still buy it and among them a ton of uninformed buyers who barely know how to press the On button on a computer; however, they buy it because it's an Apple product.
Tesla isn't as glamorous as you make it out to be. Us owners know how it suffers from terrible cabin/road noise (not well insulated for the price point), over inflated range on paper, poor range in cold weather, build quality issues, terrible service centers, etc...
What Tesla does have as an edge over the competition are in scalability, software/UI, and charging infrastructure.
I can see why you passed up on the mach-e as it is inferior in many ways to even a Tesla that isn't all that perfect either.
The IONIQ 5 on the other hand is far better built than Teslas, quieter, way better tolerance levels, rigid, safe, among the best UI in and above its price range, top tier safety suite and drivers assistance, 800v architecture, attention to detail and practicality etc... There's a reason the IONIQ 5 has Won multiple Awards around the World.
The only true EV competitor to the Model 3 will be the upcoming IONIQ 6. Other available EVs out right now are a bust. VW with their terrible Software issues, low range, poor charging speeds, poor cold weather performance etc... I hope they up their game, but the VW group in general has major issues to solve.
So as for today, there is competition and the gap is closing fast. Tesla is riding on the wave of having the power of scalability, but once other legit makers catch up the rate of market share will increase, taking away from Tesla's market share. When you (Tesla) are the only ones on the playing field for so long at 100% and others enter the market, there's only one way it'll go and that is down for Tesla.
Forgot to mention the KIA EV6 GT that's quicker than the M3P and Genesis GV60 that offers true luxury that Tesla lacks at the price point.
True. Or find a working station
