Was I wrong?

[bonaire]

Maybe you missed it but for about 4 days in mid October, Tesla was selling the Model 3 Mid Range for $45,000 which after federal tax credit and California state rebate would have been net $35,000 to you. Pricing and tax credit has changed since then, but the fact remains you could have had a Model 3 for $35,000 a few months ago.

That's not the point of the $35k car "before incentives" which was promised.

 

[bonaire]

My feeling is, most of the people who were looking at the 35k tesla Model 3 were not looking at a "35k" model 3. They were looking at a "25k" model 3. I have no proof, but I feel that pretty much everyone who did not jump on the 46k - 7500 (and for OP - another 2500 from california rebate, and another 500-1k if OP puts charger in garage), means that OP could have had a "36 k" mid range tesla model 3 with premium interior, that they could add EAP to "later" or not at all.

But, those people had done the math with the car being 35k minus 7500-10k, so..25k. Given how pretty "basic" the model 3 is to begin with as far as interior and options go, the mid range with the premium pack built into the price and no EAP was the clear winner there.

The "35k" Ev is going to be so basic that other than the exterior looks, a bolt or leaf will likely be a better choice from an options luxury feel.

Nothing wrong with those, they are nice cars but I dont like how they look... but if I had to choose between a bolt / leaf with their options, a base model 3, or an ICE car in that price range, I dont think I would choose the model 3.

If the choice was actually "35k car" then 46k minus 10k with the premium pack was the obvious choice to make, unless one was either stubborn about "I put a reservation on a 35k car" or was expecting a 25k model 3 which they are not going to get. By the time the standard range model 3 comes out, its going to be 35k minus 1875, or 35k minus zero (my opinion), so the value was already missed.

The good thing for OP is, that OP can get their money back and in 1-2 years there will be many more choices in this 35-50k space for EVs.

California will keep funding the CVRP rebate for a long while. It seems $2500 will be on the hood for at least all of 2019 and you know California... They know that in the USA, CA accounts for 40%+ of Tesla sales, where Tesla is located and when the Model 3 SR is released, may account for even more percentage given the rebate in place. Current trend is now about 200 total EVs apply for a rebate daily in CA - across all brands. It was much higher in late December.

Nearly 50% Of Tesla Model 3 Registrations In First Half Were In California
Clean Vehicle Rebate Project

 

[Knightshade]

That's not the point of the $35k car "before incentives" which was promised.

And is what you will be able to buy, sometime before end of this year, as promised. In fact if you go back to original Tesla promises it was 2020 before volume production of the 3 was supposed to happen- so they're WAY ahead of that schedule.

Tesla made no promises about what incentives would be available to reduce that 35k further when that happens of course, since they have little control over that.

 

[commasign]

That's not the point of the $35k car "before incentives" which was promised.

There’s no question Tesla is milking the tax credit while it lasts, but Tesla and Elon have never said or suggested a $25k or $27500 Model 3 after incentives would be available. The point is not $35k before incentives. The whole point of Model 3 is $35k without incentives as in Tesla has to be (and will be) competitive with similar gas cars even without incentives. Elon has stated on numerous occasions that he actually prefers that there be no incentives as long as ICE cars lose their incentives too (i.e. level playing field by eliminating oil subsidies and having a carbon tax on oil). Regardless, the standard battery and standard interior is coming as promised, but most likely after the tax credit is down the $1875 or zero. In the meantime, current incentives help bring the net cost of a Model 3 Mid Range with Premium Package to around $40k.

 

[bonaire]

There's a 2013 interview where he says it is the $30k car. So it's been moving around ever since. Intention is to ignore incentives since eventually, they should go away as cost of scale helps all automakers get into the game. The only way for EVs to win is if everyone wins. Else, it's just a this-decade hobby.

 

[Dana1]

Why build a base 35k model while your premium demand still exceeds your international demand? I wouldn’t. Seems like common business sense outside a slight bit of guilt and desire to put to rest the notion some have that the base model will never be offered. When they have meaningful production capacity to sell they base model, they will. And I don’t doubt they want to gain some time for more efficiencies to make a fair profit first. It all should come together this year while some tax credit still exists. This way Tesla guarantees good demand for at least all of 2019.

From a manufacturing perspective a mix of high and low margin products can result in market share gains. You wouldn’t want to cannibalize higher margin sales and have 80% of your sales be the less expensive option so there has to be some thought about this but you don’t want to lose a client if you can help it. Say there’s a potential client with a simple need. If you have a simpler product that cost less you capture them as a client. When their need is more complex they come back to who they know and buy the higher margin product. For Tesla this would be selling some $35K cars to the recent graduate. In five or six years they upgrade to a more expensive model or upgrade the one they have now. Or, Chevy sells them a Bolt now and later sells them a Cadillac. Tesla has some reservations...why not have a goal of producing those models two days a month. You could even do the last two days one month and the first two days the next month to reduce line changeovers.

 

[Knightshade]

From a manufacturing perspective a mix of high and low margin products can result in market share gains. You wouldn’t want to cannibalize higher margin sales and have 80% of your sales be the less expensive option so there has to be some thought about this but you don’t want to lose a client if you can help it. Say there’s a potential client with a simple need. If you have a simpler product that cost less you capture them as a client. When their need is more complex they come back to who they know and buy the higher margin product. For Tesla this would be selling some $35K cars to the recent graduate. In five or six years they upgrade to a more expensive model or upgrade the one they have now. Or, Chevy sells them a Bolt now and later sells them a Cadillac. Tesla has some reservations...why not have a goal of producing those models two days a month. You could even do the last two days one month and the first two days the next month to reduce line changeovers.

Because selling money-losing cars, which the 35k one would have been up to at least now, would cause Tesla to not exist in 5-6 years to sell them a more expensive car.

Elon was pretty clear on this point regarding why the expensive model 3s have to come first.

 

[Dana1]

Because selling money-losing cars, which the 35k one would have been up to at least now, would cause Tesla to not exist in 5-6 years to sell them a more expensive car.

Elon was pretty clear on this point regarding why the expensive model 3s have to come first.

So, re read the post. A MIX. Sell 4 cars at a 10% margin (just an example, not a Tesla margin) each, 1 at zero and you have an effective 8%. Also, we can assume cars like the Roadster have the highest margins which would offset the lowest margin vehicles. It takes some planning and some math but is do-able. At a certain point Tesla has to mix in the low margin vehicles, might as well start this year. Hopefully there will be continual demand for higher margin vehicles.

 

[Uncle Paul]

Tesla has always produced their highly optioned cars at the beginning of production. Model S and X started with signature versions, and it was not till later that the base vehicles were available for delivery. They then offered less expensive versions with smaller batteries, standard radios, smaller wheels, cloth seating and reduced performance. The lowest cost options with 40 size batteries were seldom purchased, so the 40 was upgraded to 60 then only 70 or 75s became the smallest capacitiy batteries available. Now those 75s have been eliminated and the smallest battery packs are not 100kWh.


Same with Model 3. Many had high hopes that the base model ($35,000) car would come out quicker than it has. Elon has stated that they needed to sell the highly optioned versions first, until volume could be ramped up to allow efficiencies to allow the base model to be delivered profitably. Selling the base unit in the beginning of production would have bankrupted the company, and nobody (except some shorts) wanted that.

He mentioned that they are currently developing a new, less expensive to produce, standard range battery pack that will go a long ways in making the base model possible.

It is much the same with other auto manufacturers. They make very few stripper models in their mix. They are mostly used as advertising specials to bring people in so they can be sold more profitable configurations and extra cost options.

Reality is much more common that wishes, and it will still be some time before you can order your non-optioned base Model 3. Probably still slightly over $35,000 to correct for inflation.

Elon is often guilty of over estimating what can really be produced. People who understand this usually understand to dampen their over reliance on overly enthusiastic Elon hopes.

 

[Knightshade]

So, re read the post. A MIX. Sell 4 cars at a 10% margin (just an example, not a Tesla margin) each, 1 at zero and you have an effective 8%.

Which is less than 10.

And ignores the fact the 35k car wouldn't have sold at "zero" margin, it'd be sold at a loss up to this point.

Also, we can assume cars like the Roadster have the highest margins which would offset the lowest margin vehicles.

Except the roadster isn't for sale, and won't be until next year... well after the 35k car is for sale. So that's pretty weird to bring up.

It takes some planning and some math but is do-able.

When the company needs to turn a profit and stop cash burn, no, it's really not. Hence why they didn't do it.

At a certain point Tesla has to mix in the low margin vehicles, might as well start this year.

Certainly it'll be this year... costs have steadily decreased as volume has increased, so expect they'll be able to sell a 35k model 3 without losing money this year.

Sell them at a loss last year would've made 0 sense. Especially when every money-loser would've been taking up a MFG spot a profitable car would've otherwise been built in... (and especially when making an SR non-PUP config, which is what the 35k car is, would've vastly added to manufacturing complexity during a time production was still trying to ramp).

 

[ebmcs03]

Pretty unbelievable that the $35k is still not available. I will never put a deposit down for Tesla ever in my life again. Got me once and I will never fall for it again.

Now that I blew $60k on the model 3 instead of $35k I don’t want the $35k to come yet. Otherwise I would kick myself for not waiting “a few more months” for it.

 

[Toumal]

I honestly don't know what the problem is. Yeah, the deposit wasn't worth it IMO, especially here in Europe. But I certainly won't "kick myself" for having bought the LR model. More range, better acceleration, glass roof, etc...

I see in your signature that you configured in April, which correct me if I'm wrong means that you had the choice to not take the premium upgrade. You could've also not taken EAP. But you did. That doesn't sound very logical. If you wanted to keep the price as low as possible, why did you not opt for the most basic package available? Or is range really the only thing you don't care about, and you absolutely wanted the smallest battery but otherwise max out the car - which means it's not $35k either?

 

[MXWing]

Pretty unbelievable that the $35k is still not available. I will never put a deposit down for Tesla ever in my life again. Got me once and I will never fall for it again.

Now that I blew $60k on the model 3 instead of $35k I don’t want the $35k to come yet. Otherwise I would kick myself for not waiting “a few more months” for it.

Completely believable why the 35K is not available.

Demand on the worldwide scale says no need to produce any 35K cars yet.

$1000 refundable deposit isn’t that much money. Look at insurance for a year on a Model 3. You also got 3% in points/rewards as well - more than interest from banking.

Lastly the 35K Model 3 isn’t the 60K Model 3, identical in all but price.

Performance, charging speed, range, exterior, interior, autonomy features - all change.

 

[lolder]

Pretty unbelievable that the $35k is still not available. I will never put a deposit down for Tesla ever in my life again. Got me once and I will never fall for it again.

Now that I blew $60k on the model 3 instead of $35k I don’t want the $35k to come yet. Otherwise I would kick myself for not waiting “a few more months” for it.

The car you got for $60k is not the $35k one. You got lot's of big extras and a big tax credit. Sorry you feel you "blew it". Anybody that buys the SR without EAP is making a big mistake so that car should cost 35+5+1(delivery) = $41k before any paint other than black or wheel upgrades. If someone cannot afford a $41k car ($38k after current credit) they shouldn't buy it. These cars are the most advanced items of human manufacture on the planet. That includes smart phones and jet airliners. Tesla's are smart phones and it's harder to drive a car with an autopilot than it is to land a plane on one.

 

[lolder]

I honestly don't know what the problem is. Yeah, the deposit wasn't worth it IMO, especially here in Europe. But I certainly won't "kick myself" for having bought the LR model. More range, better acceleration, glass roof, etc...

I see in your signature that you configured in April, which correct me if I'm wrong means that you had the choice to not take the premium upgrade. You could've also not taken EAP. But you did. That doesn't sound very logical. If you wanted to keep the price as low as possible, why did you not opt for the most basic package available? Or is range really the only thing you don't care about, and you absolutely wanted the smallest battery but otherwise max out the car - which means it's not $35k either?

No cars are yet available without the PUP.

 

[duanra]

True unless the autopilot screws up (plane), which sometimes happens ! ;-)

 

[Toumal]

No cars are yet available without the PUP.

I stand corrected on the PUP then. My point about EAP still stands.

Furthermore, I'd wager LR will be worth a lot more in a few years compared to SR. But that is just a guess.

 

[voip-ninja]

Pretty unbelievable that the $35k is still not available. I will never put a deposit down for Tesla ever in my life again. Got me once and I will never fall for it again.

Now that I blew $60k on the model 3 instead of $35k I don’t want the $35k to come yet. Otherwise I would kick myself for not waiting “a few more months” for it.

For starters you bought AP so that means $55K vs 40K. Secondly, you bought PUP, so if SR with PUP held pricing you are now comparing $45K to 55K.

Final point is you got tax credits that future buyers likely won't get, so the difference will be even less in practice.

Nobody knows what a $35,000 stripped down SR is going to be like but I know it won't have auto-pilot and I know the range would be impractical in about 2/3 of the country that get cold weather for big parts of the year.

I'm not sure where you are getting the $60K price from either, an LR RWD Model 3 was $55,000 with autopilot, not $60K.

 

[super20g]

View attachment 368406 Yes they tried to push me into canceling. That didn’t feel good. Why would they think I want to cancel? I’m waiting patiently for almost 3 years for my order

They might want people to take their deposits back because perhaps the only people that will be invited to order the 35k Model 3 are reservation holders... Since it wont be nearly as profitable as a car with more features/larger battery, one would assume they don't have a strong desire to sell them to every tom, dick, and harry...

 

[Knightshade]

They might want people to take their deposits back because perhaps the only people that will be invited to order the 35k Model 3 are reservation holders... Since it wont be nearly as profitable as a car with more features/larger battery, one would assume they don't have a strong desire to sell them to every tom, dick, and harry...

They're only going to build/sell them once they can do so at a profit- and after they've exhausted all backlogged demand for more expensive versions of the car worldwide.

So at that point they'll make, and sell, to anybody who wants one, as quickly as their remaining MFG capacity allows for.

Why wouldn't they?