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Will the continued low price of gas affect EV (or Model 3) sales?

Discussion in 'Model 3' started by Config, Feb 27, 2016.

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  1. tomas

    tomas Only partially psycho

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    I'm with the group that says "yes" for EV sales… except for Tesla.

    Most EVs are: 1) Small and/or ugly, 2) limited range, 3) acceptable but not great performance characteristics, 4) made in low volumes by companies with other high volume products, and represented by dealers who will push the easiest sale. With gas prices low, less new buyers will consider the "compromises" in these cars regardless of their ethics and values. Not saying nobody will buy them… just not much growth.

    Tesla cars to date (and assume the Model 3 going forward) are: 1) Roomy and beautifully styled, 2) acceptable range plus enabled for long range travel via free supercharger network, 3) great performers, 4) made by a company that only makes EVs and sold by a sales force that will never push a non-EV model.

    Tesla will continue to devour competitors' market share… because they make a great car AND it is an EV. No compromises. Any marque that makes an EV truly competitive with Tesla who takes the trouble to educate and incentivize their dealers will experience great sales as well. You know what they say: once you go electric, it's hard to go back for so many reasons.

    Having said all this, I've seen this movie before: something will jolt gas prices back to higher levels, and then the non Tesla EV sales will perk up again.
     
  2. MSEV

    MSEV Member

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    Here (Midwest) gas is up 17 percent (from 1.49 to 1.75)...
     
  3. eloder

    eloder Active Member

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    Strange, I've never once seen a line in my garage to charge my Leaf.
     
  4. wdolson

    wdolson Supporting Member

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    It just dipped below $2 for regular here and premium is still above $2 most places. It's been fairly stable for weeks though.
     
  5. ArtC

    ArtC Member

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    You should drive to the Portland area. Prices have been below $1.90 for quite some and sinking. The local gas station near my house has $1.65 as of yesterday.
     
  6. roblab

    roblab Active Member

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    No, I haven't. What's more, I never see lines when I'm out driving (just got back from a little thousand mile jaunt last weekend). No lines. No lines at Tejon Ranch or Harris Ranch, Saturday afternoon. Never needed to share an inverter (Pairing).

    I wonder that the lines were so very unusual, people had to take pictures. This is not so at my friendly neighborhood Costco gas station. There are almost always lines.

    And there's never a line in my garage. That's why we sold the Prius.
     
  7. Twiglett

    Twiglett Single pedal driver

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    Wow - last month we saw $1.28 in Killeen
     
  8. eloder

    eloder Active Member

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    The Midwest is indeed a lot less stable. I saw $1.24 here 1.5 months ago and I was seeing some $1.99 prices today.
     
  9. neroden

    neroden Model S Owner and Frustrated Tesla Fan

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    #49 neroden, Mar 1, 2016
    Last edited: Mar 1, 2016
    Model 3 is initially primarily going to be competing in the Audi A4 size bracket, and largely in the same price bracket (once loaded; we all expect the base model to be VERY stripped down). So it's competing with cars which use premium gas -- a market of buyers who are obviously not sensitive to gas prices! Those buyers will flock to Model 3 and I think they are all that is needed for the "needed" reservation numbers. So I think it's not going to make much difference to the "needed" reservation numbers. It probably will mean that fewer people "stretch their budgets" to get the Model 3, so it may have an effect on reservations further down the road. But in the near term... Tesla's still upmarket of the Nissan Leaf.

    (PS. The market of buyers I'm talking about is much more worried about having enough Superchargers, having a local-enough Service Center, having good sales & service experience....)
     
  10. wdolson

    wdolson Supporting Member

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    I think Oregon's gas tax is a bit less than Washington's. In any case Portland is consistently cheaper than Clark County. If I'm on that side of the river and need gas I do fuel over on the Portland side of the river, but working from home, I go weeks without having to fill my car. My SO also doesn't like my car so 90% of the time when we're running errands together we take her car.

    I still look forward to fueling at home. It's really miserable to buy gas in January when the Gorge winds are blowing. Unlike Oregon, it's all self serve over here.
     
  11. eloder

    eloder Active Member

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    The M3 will still be not too far off from the price of a mid-trim Leaf or a Volt. A Model 3 is going to be cheaper than a Prius after tax credits, maintenance, and fuel (post oil glut).

    I upmarketed from a smart car to a Leaf with very minimal additional cost (leasing both). You can upmarket to a Model 3 from just about any car on the market today.
     
  12. neroden

    neroden Model S Owner and Frustrated Tesla Fan

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    I guess I'm saying that it will reduce demand, but I expect Tesla to be supply-limited *anyway* so I don't think it'll reduce Model 3 demand enough to drop it below supply for the first year or two. By 2020, low gas prices might be cutting demand enough to reduce it below Tesla's supply, but I think that's about the time gas prices are gonna start going up again.
     
  13. Model 3

    Model 3 Active Member

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    I think you got it upside-down. The right question to ask is "What will Model 3 (and other mid-/long-range BEV's) do to the price of gas?".
     
  14. MP3Mike

    MP3Mike Well-Known Member

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    I guess you cancel me out. I hate how Portland spends their share of the gas tax money so I make sure to buy my gas in Clark County so Portland doesn't get any of it to waste.
     
  15. wdolson

    wdolson Supporting Member

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    Short term, probably not much, even when the Model 3 is out there 2020 production projections (which are optimistic IMO) is still less than 0.5% of the car and light truck production in the world. However, the CAFE standards will continue to reduce oil consumption until 2025 unless the US Congress decides to scrap the program, which could happen.

    I do buy most of my gas in Clark County, I don't cross the river all that often.
     
  16. Model 3

    Model 3 Active Member

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    Correct. But I did not think about short term here :)
     
  17. raysspl

    raysspl Member

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    The low price of gasoline/diesel, at this point, won't affect much the sales of EV. Technological breakthroughs in batteries & cheaper unit economics + people's awareness to climate change will continue to increase demand shift to EV.
     
  18. Twiglett

    Twiglett Single pedal driver

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    Tesla is growing even faster because its just a better car regardless of being an EV or not. Model S is outselling its ICE competitors in the year that oil prices plummeted.
    yep - price of gas has no bearing on EV sale otherwise sales of EV would have halved, but instead the growth has slowed - but still growing.
    On that basis Model 3 will not be impacted in the slightest by gas prices.
     

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