[Tomt]

You have until March 18 to order before the price increase...

 

[rmattila]

A way to boost end-of-quarter US sales on the high-end models.

 

[Off Oil]

Put down the bong, Elon

I admit I thought that perhaps his "experimentation" lead to continued use, and the erratic actions.

I'm glad however that he's reversed course on the stores. This was just stupid, and would have hurt them significantly in the long term.

 

[FI Spyder]

I think there was more than expected backlash. While the store closings looked good on paper a more reasoned measure seemed to be called for.

 

[supchrgamx]

I don't think they got the reaction from the stock market they were looking for

 

[scottf200]

I admit it is all very odd. Certainly a combination of things (in blog post below).

They really have to learn to stick it to their people and loyal customers (like us) and never look back like GM.

https://www.freep.com/story/money/cars/general-motors/2018/11/26/ontario-plant-closure/2112539002/

General Motors will close three assembly plants by the end of 2019, it said Monday, including Detroit-Hamtramck, Lordstown in Ohio and Oshawa in Ontario.

More than 6,200 jobs are at stake: roughly 1,500 in Hamtramck; 1,600 in Lordstown; about 2,500 in Oshawa; and a total of 645 at transmission plants in Warren in suburban Detroit and near Baltimore.

The Hamtramck plant makes the Chevrolet Volt and Impala, the Cadillac CT6 and the Buick LaCrosse. Those vehicles and other cars made at the targeted facilities will be terminated.

In addition to the production cuts, GM said it will reduce its North American white-collar workforce by about 8,000.

https://www.tesla.com/blog/update-tesla-stores-and-pricing

Update on Tesla Stores and Pricing

The Tesla Team March 10, 2019
Last month, we announced that we would be winding down many of our stores and moving to online-only sales in order to pass the savings along to our customers.

Over the past two weeks we have been closely evaluating every single Tesla retail location, and we have decided to keep significantly more stores open than previously announced as we continue to evaluate them over the course of several months. When we recently closed 10% of sales locations, we selected stores that didn’t invite the natural foot traffic our stores have always been designed for. These are stores that we would have closed anyway, even if in-store sales made up our entire sales model. A few stores in high visibility locations that were closed due to low throughput will be reopened, but with a smaller Tesla crew. In addition, there are another 20% of locations that are under review, and depending on their effectiveness over the next few months, some will be closed and some will remain open.

As a result of keeping significantly more stores open, Tesla will need to raise vehicle prices by about 3% on average worldwide. In other words, we will only close about half as many stores, but the cost savings are therefore only about half.

Potential Tesla owners will have a week to place their order before prices rise, so current prices are valid until March 18th. There will be no price increase to the $35,000 Model 3. The price increases will only apply to the more expensive variants of Model 3, as well as Model S and X.

To be clear, all sales worldwide will still be done online, in that potential Tesla owners coming in to stores will simply be shown how to order a Tesla on their phone in a few minutes.

And the generous return policy of 1000 miles or 7 days, whichever comes first, should alleviate the need for most test drives.

However, cars will still be available for test drives at stores at the potential Tesla owner’s request. Stores will also carry a small number of cars in inventory for customers who wish to drive away with a Tesla immediately.

 

[ItsNotAboutTheMoney]

I admit it is all very odd. Certainly a combination of things (in blog post below).

They really have to learn to stick it to their people and loyal customers (like us) and never look back like GM.

https://www.freep.com/story/money/cars/general-motors/2018/11/26/ontario-plant-closure/2112539002/

https://www.freep.com/story/money/c...hamtramck-workers-impala-cadillac/2950160002/

Well, not quite "never look back".

General Motors is giving nearly 800 workers at its Detroit-Hamtramck plant a seven-month reprieve.

GM had said it will still indefinitely idle the plant, along with four other GM facilities in North America, including the Warren Transmission plant, as part of a broader restructuring move that GM announced on Nov. 26.

 

[Steverino]

"The reason for the volte-face was not spelled out, but it paints a potentially worrying picture of corporate governance at the electric car OEM. Last week, The Wall Street Journal reported that most of Tesla's retail landlords had been given no notice as to the termination of leases, many of which had no cancellation clauses, thus exposing the company to a host of potential lawsuits.

What is clear is that Tesla sales in 2019 have been disastrous. InsideEVs, a publication close to Tesla, tracks US electric vehicle deliveries, and, according to its numbers, January and February deliveries were down by around 80 percent compared to the months leading up. Although Tesla said it would concentrate on making up volume in Europe and China, neither of those markets appear able to take up the US' slack."

https://arstechnica.com/cars/2019/0...ement-to-raise-prices-and-reopen-some-stores/

Perhaps sedans are indeed a shrinking market after all and this is why the Model Y is concept being rushed out?

Others have noted that the surprise advancement of the $35k Model 3 release from the most recent release timetable had a whiff of sales desperation around it. I don't know if that's true or not, but things do seem a bit helter skelter. I wonder how many will give Tesla a $1000 deposit for a Model Y? Maybe a bunch of Model 3 owners will unload them for a Y. If so, Some may get a higher end used Model 3 for $35k.

 

[scottf200]

What is clear is that Tesla sales in 2019 have been disastrous. InsideEVs, a publication close to Tesla, tracks US electric vehicle deliveries, and, according to its numbers, January and February deliveries were down by around 80 percent compared to the months leading up.

After reading that part it can be concluded it is rubbish and has ulterior motives.

Anyone following this at even a high level knows how many countries are were announced to be getting the Model 3 in Jan/Feb/March. This is was known. (you'd really expect record sales of the Bolts and Volts in its last 3 months of $7.5K but everyone is silent on that).

Seriously many countries are now showing the Model 3 is leading the EV sales after JUST arriving for a month or so!!!
Germany: https://insideevs.com/tesla-model-3-top-german-ev-sales/
France: https://insideevs.com/tesla-model-3-france-401-registrations/
Norway: https://insideevs.com/800-tesla-model-3-registered-norway/ & https://insideevs.com/tesla-model-3-1-selling-electric-car-norway/
Netherlands: https://insideevs.com/tesla-model-3-was-1-ev-in-the-netherlands-in-february-2019/
China: Multiple ships have taken Model 3s to China https://teslamotorsclub.com/blog/2019/02/22/1600-tesla-model-3-ship-china-video/ & https://insideevs.com/1600-tesla-model-3-ship-china-video/


The Model Y general timing has been known for many months. This was expected. This CUV has been stated to be more popular than the Model 3 and have 75ish percent of the Model 3 (i.e. parts, suppliers, etc). Certainly they want to get it out as reasonably soon as possible. They want it penciled down and complete for the Gig-3 in China too so they can sell it there. That is happening in the next year or so. Timing for China makes sense to have it well on the way in the USA first for early production. Seriously this is not obvious?!?

Everyone (dozens on this site) could not stop saying the Model 3 SR was *never* going to arrive. Now that it is here everyones changes the goal post and narrative to some other negative thing. It was stated many times in quarterly reports/calls and interviews that the efficiencies had to come before they could offer it. You know that profit thing. Seriously this is not obvious?!?

No one that is following this closely would possibly buy that post/article.

 

[Steverino]

Here are the Inside EV charts for Model 3 sales that were referenced in the article
https://insideevs.com/monthly-plug-in-sales-scorecard/

There does seem to be a dramatic drop in Jan and Feb 2019 compared to the last two quarters of 2018, but maybe that's seasonal. Still, dropping from 25,250 in December to 6,500 in Jan and 5750 in Feb seems like a lot. Could it be the tax credit effect? Or perhaps the pent up demand has been filled and that's the worry of some.

Scott, perhaps you need to let Ars Technica and InsideEV's know where they went wrong with their numbers?

 

[scottf200]

Here are the Inside EV charts for Model 3 sales that were referenced in the article
https://insideevs.com/monthly-plug-in-sales-scorecard/

There does seem to be a dramatic drop in Jan and Feb 2019 compared to the last two quarters of 2018, but maybe that's seasonal. Still, dropping from 25,250 in December to 6,500 in Jan and 5750 in Feb seems like a lot. Could it be the tax credit effect? Or perhaps the pent up demand has been filled and that's the worry of some.

Scott, perhaps you need to let Ars Technica and InsideEV's know where they went wrong with their numbers?

This is absurd. It was 100% expected and talked about ALL over the place. Most of the cars are diverted to international orders.

Comments like this are completely and purposefully misleading. International shipping as those people have been waiting way longer than the USA folks and Tesla needs to deliver those RHD (and LHD) cars:

"What is clear is that Tesla sales in 2019 have been disastrous. ... down by around 80 percent compared to the months leading up. "

Seriously, you don't see how 'disastrous' and '80% drop' a misleading when the reason is WELL KNOWN?!? It is misleadingly implying there is an unknown sales problem in the USA.

 

[wws]

...Others have noted that the surprise advancement of the $35k Model 3 release from the most recent release timetable had a whiff of sales desperation around it. I don't know if that's true or not, but things do seem a bit helter skelter. I wonder how many will give Tesla a $1000 deposit for a Model Y? Maybe a bunch of Model 3 owners will unload them for a Y. If so, Some may get a higher end used Model 3 for $35k.

The $35K Model 3 is no surprise. Last year at the TSLA Shareholders meeting, Elon was asked about it. He responded that they were thinking prototype SR packs in 4Q18 with possible deliveries 1Q19. (I was present at the meeting and heard him state it.) Looks like that is what he did. Model Y announcement is about when expected as well. The only real surprise, to me anyway, was that they will be expanding the Gigafactory in Nevada for Model Y assembly lines. It is a good move.

One thing Elon said that probably would happen by now that hasn't, has been an announcement of a location for a European Gigafactory. He did state a Chinese Gigafactory would be next, and he was right about that.

 

[JRRF]

Overall car sales have been on a tear the last couple of years, and are beginning to ebb. Tesla is caught up in that like everyone else, but their exposure is greater. They only sell EVs which are a tiny share of the market. And they only sell high priced vehicles which are also a small share of the market. The way that companies like MB, BMW, and even Porsche have been able to continue making profits over the last several years, is by introducing cheaper and cheaper models (e.g. MB A Class, BMW 1-Series) that can sell in higher volumes. Otherwise, MB can't sell enough S Class cars to make enough money to support ongoing R&D.

 

[Shivetya]

Two notes, I have yet to decide if I should jump and spend two thousand on FSD. It probably is worth it from a resale point of view.

As for the assertion that being only a seller of EV makes their exposure greater to market down turns ignores the fact they are the only company selling volume because they have the only EVs people actually want. They have proven world wide desire and they are also the only maker of EVs who is not artificially limiting how many vehicles they produce. This may change with Hyundai/Kia entering the fray but right now they are limiting where they sell in the US. GM, not trying and people aren't buying. Jaguar doesn't even build the EV, they contracted out to Magna Steyr.

 

[JRRF]

As for the assertion that being only a seller of EV makes their exposure greater to market down turns ignores the fact they are the only company selling volume because they have the only EVs people actually want.

I think this is a personal opinion. They have a brand that has some cache, but there are plenty of people that eschew that type of status symbolism. Their charger network is certainly enviable, but that's changing as time goes on also.

 

[ItsNotAboutTheMoney]

Overall car sales have been on a tear the last couple of years, and are beginning to ebb. Tesla is caught up in that like everyone else, but their exposure is greater. They only sell EVs which are a tiny share of the market. And they only sell high priced vehicles which are also a small share of the market. The way that companies like MB, BMW, and even Porsche have been able to continue making profits over the last several years, is by introducing cheaper and cheaper models (e.g. MB A Class, BMW 1-Series) that can sell in higher volumes. Otherwise, MB can't sell enough S Class cars to make enough money to support ongoing R&D.

I don't think Tesla's especially exposed. It's just a question of execution. Tesla is moving to larger segments, in a rapidly growing market and is in a position to take advantage of the inability of other manufacturers to provide the volume that can meet demand.

2018 US Premium market was over 1.75M. Entry Level Premium is the largest chunk of that, and has an ASP of $42k.

In the European market BEV sales grew by 48% last year to 200k, there are long waiting lists (up to 1 year), they have favorable tax treatment, and gasoline and diesel are very expensive.

And then there's China.

 

[JRRF]

I don't think Tesla's especially exposed. It's just a question of execution. Tesla is moving to larger segments, in a rapidly growing market and is in a position to take advantage of the inability of other manufacturers to provide the volume that can meet demand.

2018 US Premium market was over 1.75M. Entry Level Premium is the largest chunk of that, and has an ASP of $42k.

In the European market BEV sales grew by 48% last year to 200k, there are long waiting lists (up to 1 year), they have favorable tax treatment, and gasoline and diesel are very expensive.

And then there's China.

I think in Europe and China the issue might be even more pronounced, and the charging network comes into greater focus. Because unlike the US, in Europe and China single family home ownership is not nearly as great, especially as you come down the income scale to people buying only entry level premium cars.