Tesla Motors Inc (NASDAQ:TSLA) is in the news once again and a good bet says you won’t have guessed the reason correctly. The Model S P85D version has a price tag of $100,000 that is only within the grasp of the top tenth percentile, but you can now own one for less than half the cost of a large coffee at Starbucks. Tesla just made headlines after announcing that it would now be selling the Model S for $1.09.
Don’t get it twisted, you won’t be buying a $100,000 ride for $1.09, not even with the craziest of financing terms available. However, Tesla Motors and Mattel Inc.’s brand Hot Wheels, have developed a mini model of the Model S for the suggested retail price of $1.09.
Yesterday, Tesla tweeted from its main Twitter account that “Today we’re launching something for the little ones (and our biggest fans)”. Not long after, Hot Wheels tweeted a video of designer Ryu Asada designing the Model S on a 1:64 scale.
Mattel Inc. is the largest toymaker in the world and Hot Wheels is its brand that makes models of special cars. Tesla and Mattel started a relationship in 2008 when Hot Wheels released the miniature version of Tesla’s Roadster.
Catch Them Young
Tesla Motors’ push to make replicas of the Model S is a subtle strategy to attract kids to the Tesla brand. Today’s 7 to 10 year olds will be the same people buying their first car in the next 15 to 20 years when Tesla plans to get into the mass market.
Hence, it makes sense to have them develop a strong relationship with the Tesla Motors brand right from their formative years. Chris Down, Senior VP and general manager at hot wheels says, “Tesla is a brand that resonates across a range of consumers, from collectors to kids“.
Staying in the Limelight
Elon Musk is master showman and this new development will ensure that Tesla stays in the news and in the minds of future Tesla fans. Apart from the young Tesla Motors fans, a number of adults will also be hitting the store to buy the replica Model S. Some will be buying the car because of their love for the Tesla brand. Some adults will buy the Model to keep hope alive that they will be able to afford a Tesla someday.
Others will buy the model as an investment vehicle with the hopes of getting an ROI down the road. For instance, the toy model of the Tesla Motors Roadster that was sold for $1 now sells between $30 and $50 at the collectors’ market.
Pushing the Frontiers of Direct Sales
The Model S toy version will also help Tesla push the frontiers of direct sales and spur discussion the matter. Tesla Motors cannot sell its cars in states such as Michigan, Texas, and Arizona where dealerships have used the powers of the state to block Tesla’s direct sales model.
However, Hot Wheel can sell the miniature versions in all states. Hence, people will start asking questions when those Model S toys starts showing up in Best Buy and Target stores across the country.