By on March 1, 2019

tesla-model-3

Is the long-awaited, stripped-down $35,000 Tesla Model 3 profitable? Company CEO Elon Musk won’t say, brushing off the question during a late Thursday conference call.

“Yeah, we’re not going to talk about that. Next question,” said Musk, who last fall warned that releasing the lower-priced car prematurely could sink the company. The nearly three-year wait period for the 220-mile electric sedan saw a constantly evolving end date, though the anticipated March deliveries jibes with Musk’s October prediction of four to six months.

What doesn’t jibe is Musk’s Thursday admittance that, after two profitable quarters, his company will likely sink back into the red.

Less than two months ago, Musk said he was optimistic for a profitable first quarter of 2019, as well as “all quarters going forward.”

That optimism has since dimmed, with Musk telling journalists last night, “Given that there was just a lot happening in Q1, and we’re taking a lot of one-time charges and there are a lot of challenges getting cars to China and Europe, we do not expect to be profitable in Q1.” He added, “But we do think that profitability in Q2 is likely.”

Yesterday also brought news of the automaker’s move to online-only sales, with its retail stores turned into galleries, service centers, or perhaps closed. Again, the potential for job losses was something Musk preferred not to mention.

“That’s not today’s topic,” he said when asked about further layoffs. In a memo sent to employees last night, Musk warned of job cuts in Tesla’s sales and marketing divisions.

As for the public’s desire for a spartan, 220-mile Model 3 available only in black (any other paint shade will set you back at least $1,500), Musk said he wasn’t sure how many customers might spring for one. Spend two nanoseconds on “Tesla Twitter,” and you’ll be bombarded by claims that said demand is drying up faster than the Aral Sea, but accurate info on Model 3 orders is not an easy find.

JMP Securities analyst Joseph Osha told The Street “we believe that surge of late 2018 demand as buyers rushed to catch the full [federal EV tax] credit has created a hole in Q1 demand that Tesla is still working to figure out.”

Edmunds analyst Jessica Caldwell, speaking to the Los Angeles Times, said the entry-level car might have made a bigger splash had it arrived earlier. “If this model had come out when the Model 3 first launched and passion for Tesla was at its peak, shoppers might have given more latitude,” she said. “But the expectations have been set and it’s likely going to be a tough sell moving forward.”

Given that Musk won’t say if the standard model has a profit margin, it’s unlikely he’s worried about meager early sales.

While the online-only gambit will reportedly allow Tesla to drop prices by an average of 6 percent (as well as sell cars in more markets), online critics howled over the company’s plan to offer full refunds to buyers who return the car after a week, even with 1,000 miles on the odometer. The offer seemed ripe for both abuse and profit loss, they claimed.

[Image: Tesla]

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82 Comments on “With $35k Model 3 Finally Available, Tesla’s Musk Warns of a Financial Rough Patch...”


  • avatar
    jatz

    “But we do think that profitability in Q2 is likely.”

    The guy is a schadenfreude catalyzer, Too easy. Empty calories of contempt.

  • avatar
    turbo_awd

    I don’t get their “7 days, 1000 miles to return, UNLESS you took a test drive – then one day” gambit.. Just seems like they don’t actually want anyone to test drive the car ahead of time..

    • 0 avatar
      jatz

      “Just seems like they don’t actually want anyone to test drive the car”

      I test drove a Yaris once for my wife. Tesla’s not so dumb.

    • 0 avatar
      chaparral

      I think it’s because the Model 3 doesn’t immediately seek to make you comfortable – after twenty minutes your “gut feel” is that you’ve got to get out of this thing and you can’t even find the door handle to get out.

      You’ll need a thousand miles to stop panicking every time you can’t find a control or display. It will take two road trips to learn how to be sure to make it to the next Supercharger. The range / charge anxiety only goes away when you’re done installing your 240V x 30A plug at home.

      Once the fear subsides you’re able to enjoy the car. It’s easy to tell when a reviewer is still in the white-knuckle phase; read what he has to say about the steering feel. Once you’re no longer driving with your body locked up you’ll find that its changes in effort are describing what is going on at both ends of the car and that its high gearing is ideal for driving the car from the back end rather than the front. With only a few degrees of difference in wheel and pedal input I can choose between skating the front end across the road or backing the car into the corner with the motor dragging the rear end to where I need it. If you’re not paying attention all you’ll learn is that they put a large antiroll bar up front; cue the complaints about understeer.

      It’s then that you learn what they were trying to do. All you’re supposed to do is drive it. Set the climate control to 63, turn the seat heater on, put on a station you like, then change the focus of your eyes to “way down the road” and think about where you want to put the car two corners from now.

      • 0 avatar
        ToolGuy

        chaparral,

        Awesome… I’m jealous.

        • 0 avatar
          chaparral

          I hope my car lasts 300k miles; by then I’ll have figured it out.

          This week’s lesson was on overtaking. Normally with a 13-second car you use the 2nd half of passing zones, getting a good runup on the first half while looking down the opposing lane to be able to make the pass at a higher speed than the other car can get to. With a Model 3 you do the opposite – look for a clear spot right at corner exit so that you can use the big acceleration hit from 40 to 80 MPH to get it done in the first half of the passing zone.

      • 0 avatar
        jatz

        “Once the fear subsides you’re able to enjoy the car.”

        Just relax and enjoy it.

        • 0 avatar
          chaparral

          Jatz, but isn’t that true of every worthwhile driving experience?

          Your first day in a Miata is about breaking the fear of being exposed from every direction but forward. Your first day in a 3/4 ton truck with 5000# behind you is about learning where that trailer is going and where it’ll push the truck. Your first day behind the wheel of a luxury car is about not scratching that shiny pearl metallic paint on the far corners and getting enough information to drive when the car’s isolating you from your surroundings. Your first day driving in the mountains is about not looking over the edge and about driving only where you can see. Your first day in a kart is about not looping it every time you touch the brakes.

          • 0 avatar
            jatz

            I suppose the same phenomenon occurs with muslim women who endure FGM and then go on to perform it themselves.

          • 0 avatar
            chaparral

            Jatz, no, more along the lines of comparing being in a relationship to bringing someone home from a bar.

      • 0 avatar
        trackratmk1

        @chaparral props for being able to put into words what many car reviewers struggle to

        • 0 avatar
          ToolGuy

          There are respectable people I’d like to send to this site, but then I remember that there are comments like jatz’s above (“same phenomenon…”) strewn about everywhere…

    • 0 avatar
      indi500fan

      I read one post on Tweater that the fine print shows a 1200 dollar non-refundable charge for this deal. An expensive weekend rental if that’s true.

  • avatar
    ajla

    Looking at the Model 3 line, the “premium interior – long range” version would give ~300 miles of range, 5.0 0-60 time, and RWD for about $43K (no autopilot, base wheels, red paint, include destination, full Fed tax credit).

    I’m not ready to join the cult of Elon yet, but that seems pretty good.

    • 0 avatar
      Art Vandelay

      Isn’t the full tax credit a thing of the past on Teslas? And if I am just car shopping vs buying a Tesla I would counter that I can get a faster Genesis G70 for around 10 grand less and 43k gets me into a twin turbo V6. This is prior to any haggling.

      I only throw this out because without fail, anytime performance comes up with Tesla fans they talk about the crazy 0-60 times you can get on the higher end models and how fast they are for the money. They aren’t wrong but in this price class the Tesla may actually be at a performance disadvantage and given where gas prices sit, an performance per dollar an ICE car may be the cheaper option. The S feels special in its price class. This car feels sort of competetive in its price class…nothing more.

      • 0 avatar
        ajla

        The “big” tax credit is gone, but there is still a ~$3700 one around.

        As far as competition goes, I’ve bought a new V8 Mopar sedan and a new 3.3T H/K car so I’ve already seen those movies, and although I liked them both I’m not sure I’m down for a repeat so soon. I definitely think I’d rather do an EV over a turbo-4 and it would be nice to not have to pop over $55K.

      • 0 avatar
        FreedMike

        Anything with the performance envelope ajla’s talking about in the Model 3’s size class (i.e., 3-series, C-class, A4, etc) is fifty grand, more or less. To outdo that, you’re looking at something like a 340, S4, or AMG, and those push sixty.

        Plus you have the Tesla brand cachet, which is strong right now, and Lord knows buyers of these kinds of cars value that. I don’t think it’s uncompetitive at all.

        • 0 avatar
          Art Vandelay

          Branding is a thing, for sure…I just don’t see this as as strong versus the competition as the S. Then there are the current quality control issues. But yes, if you want a Tesla and aren’t making model S money, Ajla’s proposed car probably makes the most sense…moreso than the true “Ace of Base” model 3.

        • 0 avatar
          jatz

          “Plus you have the Tesla brand cachet”

          I’ve heard vinegar in bathwater can remove that.

        • 0 avatar
          Lockstops

          A Dacia Lodgy is even bigger than a 3-series as well as cheaper. As it should be. Same goes for Tesla. Absolute s**t quality, design, features, possibility for customisation, and reliability. Why the hell should a Tesla cost anywhere near as much as a proper car?

          You have to be high as a kite to compare Tesla to BMW, Mercedes etc.

          • 0 avatar
            mcs

            @lockstops: “You have to be high as a kite to compare Tesla to BMW, Mercedes etc.’

            Seriously?? BMW engineering makes the Chinese cringe. Try and keep either one of those craps brands out of warranty is asking for trouble. You’re better off with a Chinese Geely.

          • 0 avatar
            Lockstops

            Luxury, quality, how many thousand of engineering man-hours and at what level is not defined by how well you can maintain old beaters with 100k+ miles.

            Tesla is a joke, it just has a big battery pack and big electric motor. That does not equal being a good car.

          • 0 avatar
            Lockstops

            Once again a Dacia Lodgy might be more reliable than a BMW 3-series when it’s at over 100k miles. That doesn’t mean that it’s a better car, and worth the same price.

          • 0 avatar
            ajla

            “You have to be high as a kite to compare Tesla to BMW, Mercedes etc.”

            I’m not comparing it to BMW or Mercedes. I’m comparing it to Kia and Dodge.

            “… it just has a big battery pack and big electric motor. That does not equal being a good car.”

            But that does make it a quick car. Which is very high on my shopping list.

          • 0 avatar
            Art Vandelay

            “But that does make it a quick car. Which is very high on my shopping list”

            So the serious Tesla performance models are seriously fast. No argument there, but this thing is like hot hatch quick. Quicker than my hot hatch to be sure, but at twice the price. I mean if quick is where it’s at, this is Golf R money for granted, what is pretty close to Golf R performance in a straight line, but I bet the R would stomp it everywhere else (though I am speaking out of my kiester here). Still, I’ve driven both and I know which one is more fun.

            But choice is good. I want to see an electric built to handle.

      • 0 avatar
        HotPotato

        If $35k gets you 0-60 in 5.5 sec, and $0 gasoline cost, and practically no NVH now or later, that’s clearly a better deal than comparable ICE cars.

  • avatar
    Rocket

    A 1,000-mile test drive won’t work if it requires financing and all the other paperwork up front. There’s no way I’d go through the entire car-buying process before knowing if the seating position is even livable. Idiotic decision.

    • 0 avatar
      trackratmk1

      I don’t understand this either. To your point, not only is it financing, which could be one of the easiest things to undo with the exception of your credit hit, but it’s also the:

      Title application
      Sales tax
      License plates
      Insurance
      What am I missing?

      If this is a calculated move thinking people won’t want to unwind it after getting locked in, it’s a piss poor customer retention strategy that will erode all of the image equity they have built.

  • avatar
    FreedMike

    The online buying thing / return it after 1000 miles thing is nothing new – Carvana does it with used cars. As long as demand for Teslas stays strong, I can’t see the “love it or return it” thing as a significant hit to profit.

    Based on all the whining people do – legitimately – about car dealers, I’m not sure why there’s this amount of pushback on a different sales channel.

    • 0 avatar
      Art Vandelay

      I purchased my 92 Saturn because someone had driven it for a week and decided they wanted a twin cam modand took GM up on returning it. Yes, not new except I think with Saturn it was 30 days or 3000 miles

      • 0 avatar
        PSX 5k Ultra Platinum Triple Black

        I purchased a new SL2 manual transmission in 1998. It wasn’t my first choice, but it was cheap and they were still honoring the $1000 for my trade they test drove the week earlier. The transmission pretty much failed that week so I bought the Saturn. I really thought it was an ugly little car and I hated it. So I did the Saturn 30 day 1500 mile return. The Saturn dealership didn’t even know how to do the paperwork at first, but they took it back with 1497 miles on it. I was only out about $250 for the first payment that I made, but it was easy enough to do, and I got a check for my trade.

        Regrettably, I did the same thing about 8 years later with a Dodge Ram I bought in June, I traded in for a Pontiac GTO when GM did 0 for 72 months that same July. I carried about 39k on that 72 month loan, but the payment was the same as the Ram (a year longer term, but totally worth it).

    • 0 avatar
      Art Vandelay

      Also, back when I worked for car dealers I found that yes, people whined and longed for no haggle pricing…for everyone else but without fail when THEY came in they wanted a deal.

    • 0 avatar
      sirwired

      It’s very different doing that with a Used Car vs. a new one. I know that if I’m buying a car, it better have a hefty discount attached if you expect me to accept it with a few hundred on it, during which who-kn0ws-what transpired.

      I’ll accept a car with a few dozen miles that went through the around-the-block test drives, but not much beyond that.

    • 0 avatar
      trackratmk1

      Carvana isn’t profitable either!

  • avatar
    Tstag

    Tesla and Jaguar should merge. Think about it Jaguar needs a supercharger network and Tesla struggles to understand how to make cars and how to design interiors that have buttons. Tesla are good ar software, Jaguar are also rans. Jaguar has European factories, Tesla American factories. They overlap in the right places. Land Rover meanwhile actually makes money. Tesla wouldn’t get swallowed by a big corporate like Ford and JLR would retain its uniqueness. Got to be worth a shot.

    • 0 avatar
      multicam

      Call Tata and let them know… don’t they still own JLR? This was actually an idea a few friends of mine and I came up with in business school a few years ago. We saw it as an opportunity for Tata to further expand into the U.S. market.

  • avatar
    wooootles

    Given Tesla’s past practices I will not be surprised one bit if they remove this entry level car soon. They won’t lose any more money, and they can finally live to the promise that they sold a $35k Tesla.

    • 0 avatar
      Land Ark

      This is spot on.

      I doubt it’s profitable, so this will probably be a 1, maybe 2 year option.

      People are funny though:
      Tesla will never be able to build a $35k car.
      See? Tesla can’t build a $35k Model 3!
      Where’s the $35k Model 3? Musk is a shyster.
      *Tesla builds a $35k Model 3*
      Tesla will never be make a profit selling a $35k Model 3.
      Musk is a moron, why would he sell a car without turning a profit.
      *future – Tesla stops selling the $35k Model 3*
      Tesla is such a scam, I can’t believe they stopped selling the $35k Model 3

      When talking about Tesla, a lot of people are sitting with their arms folded with big frowns.

      • 0 avatar
        Lockstops

        So you don’t understand the simple concept of it being impossible to sell a proper, profitable car for $35k?

        It’s pretty simple. All of what you wrote is completely logical, and goes back to that fact. Tesla is full of s**t about selling a $35k car (because for normal businesses and normal people living in the real world, making an honest living, selling at a loss is something they refuse to do, that would mean cheating someone out of their money). Then Tesla so full of s**t towards its investors that it screws them over and sells them for $35k just to stick it to people calling out their BS. But they will not make a profit, so they will most likely stop building the $35k car because either their cash register will be empty or their investors will revolt (maybe, in the long run, you never know since Tesla investors are…um…a bit ‘special’…)

  • avatar
    ToolGuy

    Steph,

    Good article – thanks, and thank you for including a link to the memo. The changes make a lot more sense after reading the memo.
    – “Customers are becoming increasingly comfortable making purchases online”
    – “A small number of stores in high-traffic locations will remain as galleries, showcases and Tesla information centers”
    – “we will be increasing our investment in the Tesla service system”

    “Last year, 78% of all Model 3 orders were placed online, rather than in a store, and 82% of customers bought their Model 3 without ever having taken a test drive.”

    A *lot* of people buy shoes (Zappos) and eyeglasses (Zenni, Warby Parker) online – items which most people want to try on/evaluate in person. Those companies cracked the code and the selling model works. The shipping is not a deal-breaker; the return process is very manageable.

    Most of Tesla’s current customers do not live in West Nowhere – they are within easy striking distance of a ‘gallery/showcase’ – and a test drive – and a service center.

    (My wife’s new Michelins were delivered to my driveway, mounted and balanced on new rims, complete with new tire pressure sensors. New catalytic converter/exhaust manifold was delivered by UPS. This is not 1978. The system works.)

    It is intriguing to me to watch the comments evolve here from “detractor” to “person who has wandered *way* down the purchase funnel.” If I were a Tesla salesperson I’d be following up on some leads from TTAC. (“Overcoming Objections” – LOL)

    • 0 avatar
      Art Vandelay

      “Most of Tesla’s current customers do not live in West Nowhere – they are within easy striking distance of a ‘gallery/showcase’”

      Were I considering a purchase, I wouldn’t have a problem taking a day trip to Atlanta or Nashville to kick the tires, but I am not a fan of having to ship it back there for service. I have heard Tesla makes this process fairly easy, but I am not sure how well the current process scales.

      Tesla will need to service those customers in “West Nowhere” however, especially if Musk is serious about taking on the D3 fullsized pickups. The trendy urban “Apple Store” model isn’t going to work there.

      • 0 avatar
        ToolGuy

        – “we will be increasing our investment in the Tesla service system”

        Note that I said ‘current’ customers. It looks like they are aware of and working on your concern.

    • 0 avatar
      SPPPP

      “A *lot* of people buy shoes (Zappos) and eyeglasses (Zenni, Warby Parker) online – items which most people want to try on/evaluate in person. Those companies cracked the code and the selling model works. The shipping is not a deal-breaker; the return process is very manageable.”

      Those items have something like $15 production costs apiece, and the shipping is also in the $5-20 range. It’s a bit different when shipping a car and letting someone use it for a while. Also, those brands trade on convenience and just build the costs of those returns into the price of the product. They are usually not the cheapest option. But the claim is that Tesla’s direct sales will let them reduce sales channel costs, and in theory reduce prices in the future. I think that remains to be seen.

      • 0 avatar
        Art Vandelay

        Let’s say I get lit and go stupid crazy and order a set of new in the box Nike Agassi’s with the neon green stripes straight out of 1992 for 500 bucks. Or I go all in on some Brun Malis autographed by OJ for a grand. Stupid expensive shoes but frankly, I’m ok at that level buying online. 40-50k on a car sight unseen? Not so much. I suspect I’m not alone but as a gen xer, I know car companies don’t care about my opinion anyway…we aren’t “cool” anymore so who really knows.

        • 0 avatar
          ToolGuy

          I understand the perspective here, but for many of Tesla’s current customers, the level of emotional involvement/engagement with their eyeglasses or shoes is higher than it is for their vehicle.

          Also from their perspective, the car is like their phone – it’s digital – ones and zeros – it works or it doesn’t.

          And in their partial defense, it *does* get over-the-air updates.

          The beauty of the automotive business is, you don’t have to satisfy *everyone* to be very, very successful.

          In 2018, most Teslas were purchased online, without a test drive. Most didn’t get returned.

    • 0 avatar
      trackratmk1

      I also don’t need to do a power of attorney/title app, registration, financing, insurance, and value a trade when I buy a set of glasses on Warby Parker.

  • avatar
    Rocket

    JLR is also trending toward all-touch interfaces, and they have their own quality issues, plus they’re in serious financial trouble themselves. I can’t think of a worse potential custodian for Tesla.

  • avatar
    Master Baiter

    We may be approaching a point, in the United States anyway, that everyone who wants an EV, has one.

    I think range anxiety is still a big issue. While most people don’t drive a lot of miles in a day, that’s not the only consideration when buying a car. How many people buy a pickup truck because twice a year they need to haul something?

    • 0 avatar
      trackratmk1

      Any long term salesman knows the answer – nearly everyone buys wants over needs. 3 row SUV for family of three so you can haul the neighbors kids too. 1/2 ton truck when a midsize would do. 700hp when 200 is more than enough. Right now, people WANT to be able to drive 500 miles in a day, perhaps only once or twice per year. But pundits would be foolish to discredit that as an avoidance reason on EVs. It’s still a bid deal.

      • 0 avatar
        ToolGuy

        Speaking of range and wants, some ICE vehicles run out of fuel too quickly (serious comment) – combination of suboptimal fuel economy and smaller-for-some-reason fuel tanks.

        It’s frustrating on trips, and it is really an issue if you have the type of commute where you purchase fuel *around* once per week. If a smaller fuel tank on a particular vehicle means you have to fuel up every *4 days*, it can be a major inconvenience.

        (Also, make the fuel gauge linear.)

  • avatar
    EBFlex

    Musk is such a fraud.

    • 0 avatar
      SCE to AUX

      Which part of this action is fraudulent?

      • 0 avatar
        Lockstops

        First it was lying about being able to make a Model 3 for $35k. Now he’s screwing over his inverstors and selling them at a loss (= essentially with his investors’ money), just to try to cover his BS.

        Musk is just absolutely full of s**t. He just can’t help running his mouth, spewing absolutely idiotic BS constantly.

        • 0 avatar
          SCE to AUX

          Where is the lie? You can order one right now and have it in a month.

          Have you seen Tesla’s cost of goods for the Model 3? If not, you’re just guessing.

  • avatar
    CaddyDaddy

    Caddydaddy never understood why Tesla chased volume. Instead they should have focused on quality. Tesla’s are rolling garbage cans. Drive unit failures, misalignment on body and trim not to mention door handles, window motors etc…. When the tent thing sprang up I knew it was a train wreck in the making.

    Now they are going down market, we know how that turned out for Packard. No premium market brand has ever succeeded by then making a cheaper variant. It only works for proving a quality product and then moving up-market. The model 3 will be seen as a “I guess he could not afford sentiment”

    Time will tell, with Tesla’s poor quality I do not see success. Teslas are the vehicle of choice for virtue signallers. At least a Prius could make its bones and survive Taxi duty.

    As far as being a possible take over target, never. Other manufactures don’t need the tech and already have their underutilized capacity available for very little cost.

  • avatar
    APaGttH

    So as I understand it, the $35K version is a penalty box on wheels. Yes, a nice penalty box on wheels but still a penalty box on wheels. If you want any other color than black, be ready to spend more than $1,500 out of the gate.

    We’ll see how this goes – I have consistently bet against Musk and I have been consistently wrong. The brand has that Apple grade magic – it says Tesla so the rest doesn’t matter. Can’t underestimate the power of the brand – BUT – history has shown again and again that if the experience doesn’t match the brand, eventually the house of cards collapses.

    • 0 avatar
      chaparral

      The short-range car should be even better to drive than my long-range. It’ll be lighter and it’ll have a lower polar moment of inertia.

      I got the LR because I have Michigan winters to deal with, wanted my car sooner, and from my last five cars am not satisfied with anything that can’t turn a sub-14 quarter mile.

    • 0 avatar
      HotPotato

      I’m really curious. If you were on Tesla’s email list you got an email from Musk announcing the base model’s availability but noting that you could get a nicer interior, plus a little more power and range, on the “Standard Range Plus” model: 9% more car for 6% more money. (Of course from there it isn’t so much more dough for the Mid Range, and on it goes.) I took that to mean “fair warning, we cost-cut the daylights out of the interior, but you can pay extra to reverse that,” but nobody has done an Ace of Base vs Standard Plus comparo yet.

  • avatar
    jfk-usaf

    As someone that buys cars within his target market (lower end) fairly frequently I have absolutely no interest in any of Tesla’s products. They might be innovative products but I have little confidence in their quality and I find him to be arrogant and disconnected. .

  • avatar
    jberger

    I wonder if the plan is to take up the slack of sales locations, with a re-introduction of the referral program. I can see them appointing existing customers “Tesla Ambassadors” and spiffing them for each test drive, sale, etc they generate.

    We have Tesla showroom next to our office and it stays surprisingly busy. But every ride and drive I’ve had has been from current owners, so I’ve never bothered to test drive from the actual showroom.

    If they use the current retail budget to expand service and spiffs, they can probably make it work. Add in a “test drive on demand” program run from the service center for the S and X might be a suitable complement.

    Musk can move the real estate budget over to service locations, where he really needs it today, and always add back showrooms as volume dictates.

    • 0 avatar
      dash riprock

      30 days ago in their Q4 filing Tesla identified the growing number of non-franchised sales locations as major positive difference for them.

      30 days ago they were telling us that sales people were being cross trained with Solar City to sell at Tesla sales locations.

      In October Tesla told the US that you had to order by October 15 to get the full tax credit

      In early November Tesla told the US you had to order by November 15…

      In Mid November Tesla told the US you had to Order by November 30….

      In December, well in December the begging for any sale went up to Dec 31

      January 1 a price decrease across the models was enacted

      February a second price decrease was announced

      February 28 the third and deepest price cuts was announced

      There is no long or medium term plan, it is all short term survival at Tesla

    • 0 avatar
      trackratmk1

      @jberger I had the same thought, why not activate their fan base and let them meet up for test drives on their own cars? Easy enough to compensate them with free charging or service, something of that nature.

      But then, I bet Tesla’s legal team would never be able to come up with a way of covering for the fact that you’d be inviting strangers over to your house, where you park an expensive car. Even if it was a mutual off site location, potential theft (car or other property) would be an issue needing advance prevention. Furthermore the owner would need proof of a valid license and perhaps need to do an insurance check on the test driver… perhaps Tesla could do that in advance but this seems like it would turn into a legal nightmare very quickly.

  • avatar
    WildcatMatt

    The fairly recent and annoyingly unwanted auto-play video in this story as I write this is titled “Is Tesla’s Elon Musk Crazy or a Genius?”

    I don’t see how the two terms are mutually exclusive.

  • avatar
    Weltron

    “Yeah, we’re not going to talk about that. Next question,” said Musk.

    Backdoors answer: Nope, it doesn’t make money.

  • avatar
    brentrn

    I am looking forward to Tesla’s free car rental program.

  • avatar
    MKizzy

    Keep it up Tesla. Not everyone want’s to buy a car sight unseen regardless of the return policy. With more electric luxury models coming to market from full-line competitors, Tesla risks becoming the My Space of the electric automobile world: once all the rage then fading into nothing in the blink of an eye.

    • 0 avatar
      SCE to AUX

      Unlikely. Unlike building a social media website, building electric cars requires enormous infrastructure and supply chain support, especially for batteries.

      It will take real commitment for a mfr to rival Tesla’s battery production.

      • 0 avatar
        indi500fan

        Tesla’s battery production is really Panasonic, right?

        • 0 avatar
          mcs

          “Tesla’s battery production is really Panasonic, right?”

          They use Tesla’s technology. Tesla has a battery research facility in Dartmouth Nova Scotia. Soon, they’ll be adding Maxwell Technologies to their battery portfolio.

          The motors are also Tesla’s design manufactured by someone else. Those motors are one of the reasons Tesla has an efficiency advantage over everyone else. Some amazing engineering in the magnets.

        • 0 avatar
          addm

          Panasonic just make the cells. Tesla do the pack assembly. As mentioned below, Tesla do have good research credentials for the cell chemistry

        • 0 avatar
          addm

          Panasonic just make the cells. Tesla do the pack assembly. As mentioned below, Tesla do have good research credentials for the cell chemistry

  • avatar
    HotPotato

    While I don’t care for his Trump-like personality characteristics, I’ve got to hand it to Musk for proving that an electric car can be quick, fun, sexy, luxurious, desirable, and now affordable too. I can’t see anyone buying the long-range Nissan Leaf now unless they’re hell-bent on getting a sedate hatchback with a soft ride.

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