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Will Model 3 truly be 'mass market'?

Discussion in 'Model 3' started by vinnie97, Mar 3, 2015.

  1. vinnie97

    vinnie97 Member

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    #1 vinnie97, Mar 3, 2015
    Last edited by a moderator: Mar 5, 2015
    (mod note: split from the Ford Will Unveil a Chevrolet Bolt Competitor This Year thread)

    I was under the impression Tesla had aspirations to move beyond just premium BEV.
     
  2. RobStark

    RobStark Active Member

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    Elon considers a BEV that starts at $35k to be a mass market vehicle.

    To most that is an entry level luxury car.

    I saw a Dutch TV show interviewing Elon and asking him questions about Tesla.

    They asked him if Tesla will ever make a Golf competitor.

    He laughed and said no more like Audi A4 type vehicles.

    It may be that during Elon's CEO tenure Tesla will never be able to meet demand for $35k plus vehicles.

    And maybe it will be up to the next Tesla CEO to pursue markets below $35k.
     
  3. EarlyAdopter

    EarlyAdopter Active Member

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    Depends what you mean by "market" when referring to "mass market." The average selling price of a new car in the US in 2014 was $32,000, so the Model 3 is most certainly a mass market car if you define the market as "everyone who buys new cars."

    However, that market is only 1/3 of the US adult population. So if you define the market as "everyone in the US," then indeed it's not for the masses. But I'd argue that's moot, since that's not where the market for new car sales has been for a long time as those people buy used or don't have a car at all.

    In time, as battery production continues to ramp up and production costs ramp down, I'm confident we'll eventually see 200 mile BEVs priced down into the teens, where any and everyone who buys a new car can afford one, and then trickle down into the used market.
     
  4. RobStark

    RobStark Active Member

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    The ASP for an American Vehicle was $32k.

    The target base price of a Model 3 is $35k.

    The ASP for a Model 3 will likely be above $45k and approaching $50k.

    Lifetime TCO doesn't seem to resonate very strongly given how many people commute in ginormous gas guzzlers.

    And how many people lease or own a new vehicle for only 2-4 years. Not letting the gas savings accumulate for very long.

    And Model 3 can't have yearly maintenance at $600/year or anywhere near that and present a credible TCO argument to the average American.
     
  5. Grendal

    Grendal Active Member

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    I agree that the Model 3 will be more of a premium mass market vehicle. Elon has always said he wants it to be on par with a BMW 3 series. That is not a Chevy Cruze, Civic, or a Focus type mass market car. I think that is where Elon and Tesla will allow the large manufacturers the room to make a low end mass market vehicle. Those will be more city car oriented like the Leaf and the i3.
     
  6. richkae

    richkae VIN587

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    I'm going to refer to a post of mine in another thread.
    The importance of price to sales

    Here is a chart of 2013 car sales bucketed by MSRP.

    attachment.php?attachmentid=59804&d=1411438861.png

    In 2013 the total vehicle market in the US was about 16 million.
    For cars that start at $70K MSRP, my best guess from this data is that the total market in the US is about 140,000 - 160,000 vehicles.
    For $60K MSRP and up the total market is about 250,000 - 300,000 vehicles.
    For $35K MSRP and up the total market is about 1.7 - 2 million vehicles.

    The market for $35K MSRP and up vehicles is 10-15x bigger than the one the Model S plays in now.
     
  7. gregincal

    gregincal Active Member

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    Certainly there is no strict definition of whether a vehicle is Mass Market or not. The top selling car in the US last year was the Camry, with about 400K sales. The BMW 3 series had 142K sales in the US, so that certainly seems pretty mass market compared to Model S sales. I would generally consider most of the entry level vehicles of the luxury brands to be mass market vehicles, and the Model 3 will be in line with that.
     
  8. vinnie97

    vinnie97 Member

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    Oops, didn't mean to wreck the thread from whence this post came.

    According to Richkae's chart, the "massiest" of markets is around $24k. I'd like a 200-mile EV in the Prius price range, but that may not be for a while yet (2020?). Hope I can maintain the Hybrid ICE'ing in the meantime.
     
  9. aronth5

    aronth5 Long Time Follower

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    I don't believe that most people will think of the Model 3 as a mass market car the same way they don't consider a low end BMW or low end Audi mass market.
    43%+ of the members who responded to a poll on the average sale price of the Model 3 said it would be over $50k with over 77% saying it would average over $45k.
    It really depends on who you ask. When I've brought this question up to people I work with the term "mass market" was interpreted by most as a low cost vehicle. Not sure I necessarily agree with that but the response was pretty consistent.

    http://www.teslamotorsclub.com/showthread.php/41924-POLL-What-will-be-the-average-sales-price-of-the-Model-3
     
  10. Trev Page

    Trev Page Member

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    It depends on how you use your car. In my case a $50k model 3 makes sense due to not having to pay for gas since I finance my cars over 5 years and I don't lease since I drive too many kms per year . The lower TCO factors in for me and I end up with a car just as nice as 3 series to boot.
     
  11. ItsNotAboutTheMoney

    ItsNotAboutTheMoney Active Member

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    #11 ItsNotAboutTheMoney, Mar 5, 2015
    Last edited: Mar 5, 2015
    TCO has failed to make hybrids top sellers, but a long-distance EV for $40k would be a whole different kettle of fish.
     
  12. renim

    renim Member

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    about 70% of Europe vehicles are Compact or smaller (ie Corolla or smaller)
    about 75% of US vehicles are Midsize or larger (ie Camry or larger)

    so there is not any significant overlap between the 2 regions.

    But make monthly lease payments on a Tesla Model 3 the same price as a cam-cord-tima + fuel - and yes it will be mass market. (for Americans anyway)

    Globally 'premium' brands are eating away the top end of the mass market anyway, for example Honda is withdrawing the EU spec Accord from market. Honda discontinuing Euro Accord, no replacement in sight
     
  13. KJD

    KJD Member

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    As long as the Model 3 is half the price of the Model S it will be a mass market car.

    The thing that surprised me is how much of the high end market Tesla was able to grab in a short amount of time. That trend will continue.
     
  14. ecarfan

    ecarfan Well-Known Member

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    What is also surprising about the S is how many buyers are spending significantly more than they ever have on a car (that includes me). The Model S is so compelling that many people are willing to go outside their comfort zone and stretch to buy it.

    I predict he same thing will happen with the Model 3. Sure it's base price is predicted to be higher than the average new car selling price in America, but if it is truly compelling many people will pay that.
     
  15. stopcrazypp

    stopcrazypp Well-Known Member

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    Can it be considered a "mass market" car in general terms? According to the price it might just be barely above, although target volume certainly matches.

    However, as a "mass market EV" I think the answer is definitely yes. Keep in mind the 2011/2012 Leaf started at $34-35k and no one would oppose calling that a mass market EV. And Tesla is targeting selling way higher volume than the Leaf sold. Yes, the Model 3's ASP will be significantly higher than the Leaf (even vs old prices inflation adjusted), but for the base price it definitely qualifies as a mass market EV. And keep in mind part of the higher ASP will be based on more battery and performance options (non-existent for any non-Tesla EV so far).

    I would also like to mention Toyota is calling their $57k Mirai the first mass-market FCV.
     
  16. renim

    renim Member

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    Chevy Impala 1LTZ has an MSRP of $35,290
    Audi A4 has starting price of $35,500
    Altima 3.5 SL goes for $32,350

    Tesla 3 base model will be mass market on lease repayments + 'fuel'

    ASP, thats another story.

    question

    Mitsubishi Outlander PHEV - is that mass market? what about the upcoming ASX PHEV?
     
  17. JohnSnowNW

    JohnSnowNW Active Member

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    We are doing the same with the Model X...just to continue the trend.
     
  18. ItsNotAboutTheMoney

    ItsNotAboutTheMoney Active Member

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    I think the Model 3 being mass market will really depend on getting the base price down, without compromising the car. I'm a "mass-market" buyer, and wouldn't dream of buying from a luxury Make, or spending $40k on a regular car. I bought a Civic ($18k), then a Prius II (~$22k), then a Volt (~$26k MSRP w/credit). However, I'm mentally prepared to spend $40k on a Model 3, for 200 mile + Supercharging + subzero package (heated mirrors, seats, heat pump). Match the performance of the Volt and my wife would be happy. My key concerns:
    - Hitting the price target: Tesla doesn't exactly have a good track record. However, I'd suggest that the key focus of Model 3 is to bring price down, and given that EV performance is still expensive, I think that base performance will depend on the other cost reductions. The lower the potential price, the more likely they'd be to release a base model with lower performance, say 32Xd performance (~7s 0-60) rather than 32Xi (~5-6s 0-60).
    - Battery size: talk of a 48kWh battery worries me, because of the proportionally greater loss of range in cold weather due to use of climate control. If they did try to have a CA-sized pack to reduce base cost, I'd hope that they'd have an intermediate pack available. Having to stump up for a 20kWh upgrade would push the car out of my budget.
     
  19. Mr X

    Mr X Future Owner

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    More so than the S yes. Still not going to be a car that everyone can afford, but a larger percentage of people will be able to afford it.
     
  20. 1208

    1208 Active Member

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    No. Not in the UK anyway. I consider mass market what the majority of people would buy or can afford. Imho based on the most popular cars in the UK http://www.autoexpress.co.uk/best-cars/85843/best-selling-cars-2014 and in the area I live I would say that price is £15,000 or $22,700. Which is roughly the cost of a Leaf. So Tesla has got to do some cost cutting to take 10k off of the model 3 to be mass marketable.

    Or sell a 4th model, the Model C, a small hatchback with basic features, which is truly mass marketable.:cool:
     

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