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Tesla's Promised $35,000 Model 3 Is Still a Long Way Off (engadget.com)
When the Model 3 was first unveiled, it was pitched as an EV for the masses that would have a reasonable $35,000 price. Two years later and we still don't have a clear timeline as to when the $35,000 Model 3 will ship. In fact, Elon Musk last weekend unveiled the pricing and specs of a newer, more expensive Model 3 with AWD. It will cost $78,000. Engadget reports: CEO Elon Musk recently tweeted that the $35,000 Model 3 now won't ship until three to six months after Tesla achieves its 5,000 vehicle-per-week production goal. The reason for the new delay in the base model is simple: If the company was to ship it now, it would lose money on every vehicle and "die," as Musk put it. If Tesla had hit its initial forecasts and was producing 5,000 vehicles a week by January, the base, $35,000 Model 3 probably wouldn't have been delayed by so much. One potential problem for Tesla, as the WSJ points out, is that many of the 500,000 buyers who laid down a $1,000 deposit did so expecting to buy a $35,000 car, not a $49,000 one. When they get a letter saying the time has come to configure their EVs, quite a few might decide to back out, which could impact Tesla's already precarious cash flow situation.
It's almost like you want to sell the higher margin ones first, in order to help pay for the amazing capital expenditure it takes to build a car assembly line.
Who is shocked by this? Nobody should be, as this is how it has always worked.
Slashdot still doesnâ(TM)t support Unicode after it was added to the HTML standard in 1997.
Dear mutual friend. My name is Pieter Mercer-Koch and I am a poor billionaire short seller and, due to a strange circumstance I am now in debt for 4037 (four thousand and thirty seven) Tesla shares. I am writing with an offer which will be of joint appreciation. I know you possess 45 (forty five) Tesla shares and are afraid that if, in the current delicate circumstances you attempt to sell them the share price will collapse under the unbearable weight of having to sell their cars for to much money (dollars, dinero, cash, folding stuff). Send me your share certificates and I will relieve you of this problem.
Please. I'm begging now.
CAPTCH: slumming
This is a fantasy and will never happen.
Elon Musk is a religion.
Word is that Tesla will need another round of funding before they can fulfill all the existing Model 3 orders. It makes sense they'd try to avoid this by fulfilling the most profitable orders first. There are likely enough of those to 'put off' the $35k Model 3 for a while. Given they recently announced options for a more powerful Model 3, they're likely going to remain in 'premium' territory for a while. Soon they'll be making more Model 3s each month than Bolts are made each year, so it's not like competition is stiff; they can afford to keep the less-profitable customers waiting.
Worst case scenario, Musk pulls a Bezos and gives a Billion to Tesla (a la Blue Origin).
Corruption is convincing someone that the selfless ideal is the same as their selfish ideal.
That's what happens when you pour an enormous amount of government subsidies onto an incompetent bunch of amateurs based only on their sweet talk. Actually, given the awful build quality, the serious QC and engineering issues, the high price, which doesn't cover the even higher cost and the incompetent shills like Rei on Slashdot, Tesla will go under a lot sooner.
By the time Tesla manage to make a $35,000 Model 3, other manufacturers may well have beaten them to it.
Some are already close. The electric Hyundai IONIQ is less than $30,000 and if the range improves by 60 miles or so (50%) it will be competitive with the Model 3 - which doesn't seem like a huge leap.
And this is just one model. There is already the 180+ mile range Renault Zoe available in Europe, and the new LEAF has around 170 miles.
Indeed. But there hasn't been any logic behind Tesla stories for at least 6 months now. There are a lot of investors who are seriously on the hook if Tesla is able to get production running smoothly. Some of these may face an existential crisis if a short squeeze were to develop.
In light of this, it makes complete sense that investors would be motivated to talk the stock down to give themselves a chance to offload some of their short positions. Given the immense scale of Tesla shorting this is likely to continue for some time.
The trouble is even if a small number of short sellers are trying to exit their positions, this creates upwards pressure on the stock price, which makes the situation worse for them. I think Tesla stock is overvalued (though in the current financial environment of unicorn tech stocks, maybe not over valued in a comparative sense), but I would not be suprised if a good portion of that overvaluing is due to all the short sellers themselves.
Musk is probably right. Either he will go down in flames, or Tesla will become a widow maker for short sellers. In light of these two binary choices the media war around Tesla stock is hardly surprising.
$35k is double the price of a Corolla, which is basically the same size and doesn't suffer from the countless inconveniences of electric cars (though granted the smug factor is infinitely less). Nevermind that "the masses" on average drive a car that they bought for $5k used and has been around about 4 times longer than that giant touchscreen will ever survive.
Do to the philosophy of "Not Invented Here" everything Tesla Cars do is bespoke and unique to their design. Which throws away years of manufacturing know how and makes their cars very expensive to repair and maintain outside of the Tesla community.
This means the "Mini" or "Beetle" replacement will not be built by Tesla.
Unclear. It's always unclear.
When... how much... if at all...
People will drop off the list. Others who didn't want to put money down that far in advance, have since had a car wear out, or since become more successful will gladly throw in. As the car becomes more available, moves out of the beta phase it has obviously been in, people see them, people ride in ones their friends have, etc., reservation numbers will increase, not decrease.
The Tesla crash on Crow Canyon Road in Castro Valley must have been spectacular!
The car veered off the road, did not brake (no skid marks in the news video), hit a dirt berm, was launched airborne, flipped over in the air to land on it's rear at the edge of the pond, smashing the rear end, then sliding into the pond. If the driver survived the crash, he was drowned minutes later, maybe even electrocuted in death by the smashed open batteries.
The Tesla Autopilot has a deadly flaw! The software finds a "correct path" to drive the car into, the path is defined maps, painted road lines, distance radar, etc. The problem is when the path is found to be in error and needs to be corrected, which happens on occasions for whatever reason, there are only a few seconds for Autopilot to react and steer the car onto the correct path *OR* slam on the brakes.
Tesla had to make a decision. Do we slam on the brakes every time we find that the car path needs to be corrected? Or do we allow the car to return to the correct path?
If they slam the brakes on every time the car is found to be off of the correct path there are going to a lot of Teslas on autopilot slamming on brakes. For example: a swerve out of a lane -- slamming on the breaks for swerving out of a lane is inappropriate on a freeway. But slamming on the breaks when leaving the lane on a curving canyon road is not inappropriate, in fact it would be life saving.
Now we see these accidents where he car has not braked in life threatening situations. In fact the car is likely never to break correctly unless it has much better awareness of the physical world and can understand the difference between leaving a lane on the freeway and being completely off of the roadway.
There is a steady stream of negative stories about Tesla popping up recently. So many that it is starting to feel a bit artificial.
EAT! MY! SHORTS!
People willing to wait months or years for a new Tesla obviously are in a category of not needing a car, they want a Tesla for whatever reason and I call this the cult factor. Like people willing to wait in line days or more when the new iPhone came out are probably those same type of people waiting for a Tesla. I am not in the market for a EV type vehicle but I buy something that's available today not next year.
..because investors wanted him to have an affordable car that would make profit for the company.
instead of rushing it for production, he is rushing a model that costs over double the price, nearing base model s pricing. because he just plain old bullshitted about the 35k price with the usual musk straight face. he had no means to make it at that price.
and yeah there was a bunch of people who kinda expected it to be in production now and be profitable for the company while at that.
preeetty sure nobody pre-ordered it with a disclaimer saying that "oh yeah we'll get around to making it once we can somehow make it for that price". come on.
world was created 5 seconds before this post as it is.
The schedule was front and centre. Production of LRs was to begin first and follow an S curve starting at in July, peaking in December. Anyone logged into their account could see their particular estimated window for the LR version, which for early US reservation holders was somewhere along this curve. They could also see that if they chose the SR pack, it wouldn't be available until after LR production had peaked, in Q1.
Literally nothing has changed except for how long the LR rampup took. Maybe a slight stretch between LR peak and SR delivery, depending on how you interpret the delivery windows, but nothing meaningful. Yet once or twice a month we're treated to concern trolling about it, from people who have no interest in the Model 3 themselves. Just like we've been enduring this relentless concern trolling about the rampup. But now that the rampup has nearly completed, I guess we have to switch the concern trolling to something else. Tell me, after the SR is delivered, what's going to be the next topic to incessantly concern troll? Air suspension? The tow hitch? The Model Y?
Give a boy a gun and you arm him for a day. Teach him how to make a gun, and the whole metaphor breaks down.
In at least some states, some people placed their reservation expecting to purchase a $25,000 electric car (after rebates). Once the rebates end (and a lot of those pending base model 3 orders will be outside the rebate period, which is scheduled to wind down by early next year) some of those orders will disappear.
I don't care a ton.... but if I could get an AWD Tesla with a longer battery life it'd be nice. There are a few charging stations near my area, and I don't travel long distance often enough to warrant much fear on the battery life. Plus the Ludicrous Speed thing would be fun.
But there's honestly not enough to make me get one right now even if it was available to instantly purchase. I've yet to feel like I'd need to flame or defend Tesla though.
Alternative explanation: it's actually very small.
Confucius say, "Find worm in apple - bad. Find half a worm - worse."
^^ A fool who has parted with his money.
that maybe so, that won't make the average punter who forked out the $1000 to support Tesla and reserve their $35k any happier that they are being given the arse end of the deal.
If anyone plunked down a deposit expecting to not have to wait a long time then they are idiots. 1) Tesla ALWAYS over promises delivery dates and routinely misses them. This is nothing new. 2) Tesla has ZERO experience with production at this volume. There is a learning curve. 3) If you buy the "cheap" model then you aren't their best customer and you should expect to go to the back of the line. Every business serves their best customers first. 4) A car received later is better than a car not received at all. 5) Tesla was up front that the pimped out models would be delivered first. Almost everyone has had to wait a little longer than hoped for.
It's just frustrating. I don't want to go back to fossil, but I need more range. The Leaf 40 is a disaster, and who knows if the 60 will be any better.
So buy a Chevy Bolt or a Volt. Both have much better range than the Leaf and are decent cars in their own right. The Leaf is a car that is useful for short commutes and that's it. If you need more then buy something else.
They are not concern trolling, they are either attempting to drive down the stock price, or just jealous of Musk.
Some old-fashioned, typically coal-rolling monkeys are angry that Tesla exists. Us other gearheads are just waiting to see what they do next.
"You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
Which suggests that all those people who "only" buy the $35k model (expensive for a car, still!) are second-class customers whose business alone can't sustain the company, whether or not they are early adopters, first in the queue, etc. etc.
You fail Cost Accounting 101. Tesla invested a huge sum of money up front to build an assembly line. To recoup that cost you have to sell a lot of units. The fastest way to get out of the red is to sell the units with the highest margins first. If you don't get out of the red then the company experiences an opportunity cost having the money tied up in capital equipment that it could put to better use elsewhere.
You shouldn't be using CAR SALES to pay for the CAR ASSEMBLY LINE. That's what all those millions in investment were for.
You have no idea how manufacturing actually works do you? The ONLY thing that will pay for that assembly line is sales and that is true for every product from any company. The investors money isn't a gift and it has to be repaid. Doesn't matter if the money to build the line came from the company savings or from outside investors. The only difference is the cost of capital. You have to sell product to pay for it and capital tooling expenses get paid for over periods of years. Any company that doesn't serve their highest margin customers first is monumentally stupid. Furthermore Tesla was up front that this was EXACTLY what they were going to do.
There's the powerful counterpoint of course that those vehicles actually exist, the $35k Tesla 3 does not in production quantities and is sliding further into the future with every announcement.
The Ioniq EV sold 6797 units last year globally. Tesla delivered more Model 3s than that last QUARTER and is accelerating production. In fact Tesla delivered more Model 3s than the Chevy Bolt and Nissan Lead COMBINED in Jan and Feb this year. Right now Tesla is delivering around 2800 Model 3s per week.
By the time I can walk into a Tesla dealer (especially in the UK as the RHD will be even further behind) and buy a standard Tesla 3, there will be probably another 2 major updates to that Ioniq. And maybe Ford etc will have their hands properly in play.
That's a nice little fantasy story you are telling yourself. You do know Ford is literally stopping production of almost all non-truck vehicles right? And you think the Ioniq is going to magically be redesigned massively to compete on range with the Tesla?
Hell, he is just maximizing subsidy value, get over it. He can't deliver car 200,000 until the beginning of Q3 2018, or a very large number of people would lose out on the tax credit. Tax credit is more valuable on the more expensive cars.
The Anti-Musk trolls / astroturfers are really getting old. Tesla might have issues, but they are very much out in the open. At least you get transparency...
Will Musk reach Mars before he is able to offer a $35,000 car? I might need to look into that bet.
somewhat disgruntled customers
Here're some observations:
1) You're a fucking moron.
2) Don't make up shit, moron.
Unless Congress extends the tax credit, al lot of those people waiting for 35K Model 3's will not be eligible for it since Tesla will have hit 200K before tehy start on the base Model 3 deliveries. If those waiting for the base model and planned on it being around 27.5K after the credit (less any additional state rebates / credits) they are in for a shock. I wonder how many will stick around if the credit sunsets for Tesla?
I'm a consultant - I convert gibberish into cash-flow.
As long as Tesla positions the service department as "service here or don't get service at all" the only appropriate purchasers are people with extremely disposable income.
People who spend 35k on a car expect to have it serviced at an independent garage. You can't do this with a Tesla because Tesla is blocking it.
Therefore until Tesla changes its attitude, chances are they KNOW a 35k car is a PR disaster in the making.
Neither are available here.
I have no idea where you are but I'll guess Europe. If so buy a Renault Zoe. Or a BMW i3 with a range extender.
GM has no problem doing it with its Chevy Bolt.
GM has a long track record of successfully launching cars on time and at a specified price. They have established supply chains for manufacturing support, build-time parts and service-side parts.
This is Tesla's fourth product launch and they are having many of the same problems as previous product launches. They shouldn't be. They should have this stuff nailed down by now.
I have to post AC here because I voted on some of the posts.
I live about 3 klicks up the hill from the Tesla plant and my housekeep's husband works there as a welder. The days she is here he comes to pick her up in the evening and I ask him how it is going at the plant.
He can be a kind of an excitable fellow and he is not shy about telling me about the problems they have. But he is also optimistic about what is going on there and last week he told me that Elon had been sleeping overnight at the factory quite a few times.
As a stockholder of many companies it is notable to see a CEO doing that.
On the plus side that tells me that he is serious about getting Tesla's production volume up.
The down side is that I don't want that to go on too long since it suggests that the organization can't sustain itself without him. Success will be when his time is spent sipping a latte while looking out the window at the production floor.
Overall I am concerned but not alarmed about the reported problems. Given their goals I would be alarmed if there were not any reported glitches and problems. Real boats rock.
You show your hand. You own stock, thus have a literal investment to fight against any legitimate concerns of others
Because Kickstarter has gotten people used to investing in a company with the only payout being (hopefully) acopy of their product. In other words, it is, but people are so used to it that they won't call it that and instead attack you for it.
Your ad here. Ask me how!
Carmakers have always advertised bottom-of-the-line stripped models that have been nearly impossible to find. However, in the past, they always had to prove that there was at least one such vehicle available for sale at the time the ad for it was published or shown. Tesla seems to have taken that to the cyber-limit: we designed it, but we won't produce it. That seems to go over the line into false advertising unless they have in fact removed the loss-leader from the product line and refunded deposits to those who signed up for one.
For lending Tesla $1,000 at 0% interest and using you to advertise an artificial "reservation count". In turn, helping lift the stock price so Elon could borrow hundreds of millions against it while insiders(like brother Kimbal) could cash out at a crazy valuation. Feel honored, the last time Musk thanked the shareholders was when they bailed him and other insiders out by tying the failing SolarCity albatross to Tesla's neck. The question now is, who's going to bail out Tesla?
Keep this in mind depositors; in a bankruptcy you are an unsecured creditor. And given that the Fremont plant was just put up for collateral, there will be very little(if any) left once the secured creditors are paid.
One potential problem for Tesla, as the WSJ points out, is that many of the 500,000 buyers who laid down a $1,000 deposit did so expecting to buy a $35,000 car, not a $49,000 one.
Really? What % of ordered cars was 35K only? I have not heard of any of the known M3 buyers to say that they were buying the base model. In fact, about the most ordered one that I have heard is AWD, higher battery, and luxury package.
So, where does WSJ get their info that claims that many are looking to buy 35K car?
Except when you put down that $1,000, they told you it would be 18 months for the $49K version and another 6 months for the $35k version. At no point were you told that the $35k version would be produced first.
Why is "it's beneficial for him to help the people who paid him more instead of those who paid him earlier" a valid argument for why I shouldn't think he's an ass?
Your ad here. Ask me how!
Last I checked it was as fully refundable deposit. If it were not I would agree with you.
It's almost like you want to sell the higher margin ones first, in order to help pay for the amazing capital expenditure it takes to build a car assembly line.
Who is shocked by this? Nobody should be, as this is how it has always worked.
Henry Ford started out with the affordable mass market car and built out from there. Economies of scale and all that.
The new generation Nissan Leaf drives itself. My local dealers are selling the top trim for under $30K. That comes to $22.5K with the tax benefit.
It also now has a more powerful battery pack and 30-minute fast charging and, thankfully, electric vehicle warning sounds, the lack of which has been a pet peeve of mine with electric cars.
Kriston
I'm pretty certain I've seen them on the road where I live.....
You have a habit of not reading things to the end, or at all.
So it's no surprise you would be upset about something that you should have read and known about, but didn't, and then complained about not knowing.
last I checked not only has that 18 month period long passed we are also passed the 24 month period.
First model 3's were delivered last year, it has been well past 6 months since then, getting towards 12 months now and we are still many many months before the base model will be available. any way you twist the numbers this is definitely not meeting the promise.
Clearly you've never gone to BMW, Audi, or Mercedes and built a car on their online tools - they all do the same thing. Example from BMW:
Start with a base model 3-series, add the larger engine but not the largest and all-wheel drive(330ix), and a modest (not highest end) option package, and you end up at $48,250 before the dealer charges and taxes. Base model 5-series? Starting at $51,200.
Also, it's of note that BMW, Audi, and Mercedes *never* start with new features and technology in their "compact" sedans - it always begins with the highly profitable full-size sedan 7-series / A8 / S-class, and then find there way to the mid-size 5-series / A6 / E-class, and then eventually end up in the 3-series / A4 / C-class. Why? For the same reason as Tesla started with the more profitable extended range model 3 - to pay for the development faster, work out the kinks of mass production, and then throw the factory to high speed.
It's almost like Tesla is a company that makes luxury cars, and follows the same pricing schemes and strategies as other luxury car makers. But you already knew that, and you're just bitching for the sake of bitching. Because Tesla.
Slashdot still doesnâ(TM)t support Unicode after it was added to the HTML standard in 1997.
You show your hand. You own stock, thus have a literal investment to fight against any legitimate concerns of others
I literally own stock in nothing. It's unfortunate, for me, but fortunate for anyone who listens to me since I am not shilling for anyone. I call out Tesla's failures regularly - check my posting history. However, that doesn't mean I want them to fail. I want them to succeed so they keep pushing us towards EVs.
"You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
You're my favorite Slashdotter. And I'll be in Reykjavik May 27, May 28 and June 7... may I buy you lunch?
(Sorry to spam a bunch of your posts, but I wanted to be sure you saw my invitation.) Reply to GPSpilot1@NOsPam.gmail.com.
And you're right... it's ridiculous that we can't type a thorn here.
That that is is that that that that is not is not.