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Tesla Inc Lies About Model 3 To Prevent Battle Of The S3Xes (TSLA)

Tesla Inc (TSLA) Store in Southern California
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Tesla Inc. (NASDAQ:TSLA) now caters to everyone, wealthy or not. Before June 2017, the young automaker produced cars solely for the deep-pocketed individual. That all changed with the Model 3, though. Now the world’s front-running, luxury electric car maker is more inclusive than ever.

The Model 3 does not only give other sedans in its class a run for their money. With a price tag of $35,000 at its most standard, it threatens its older, more premium siblings, too. What Elon Musk essentially offers now is a “build your own Tesla”.

It is also true, at least for now, that the car is not as customizable as its higher-end compadres. However, Tesla only does this to deter buyers from joining an already overwhelming reservation list. Once production capacity goes up, buyers will likely see more options added. If all goes well, Tesla will find itself with a little extra leg room in a year or so.

Tesla Inc Model 3 Takes on a Life of its Own

Whether Tesla Inc. publicly admits it or not, its newest car is also its newest flagship. Half a million deposits ahead of its actual release is no minor number. That number is only set to rise once people start seeing more of the car on public roads. As Musk already admitted, the Model 3 was supposed to draw small amount of attention, has taken on a life of its own.

Credit where credit is due, the Musk car business certainly does well for itself when it comes to customer retention. Most surveyed owners admit they would never revert to combustion engine car. A report by a Bernstein analyst also shows that Model S owners consider a Model 3 for their next upgrade. This proves the threat imposed by the Model 3 on its premium counterpart is real.

Tesla Inc Model S
Tesla Model S Dash View

Tesla might say its new car is inferior to begin with. However, the company knows that is it nothing of the sort. It comes with 310 miles of range per full charge for an additional $9,000. That comes to just under $45,000.

This price puts it in line with its biggest rival, the Chevy Bolt, with better range too. Also, $45,000 is still far lower than Tesla’s entry flagship sedan. That is the 75kWh battery Model S, which starts at about $30,000 more. Worse still, that price gets buyers a premium sedan that only span 249 miles on a single charge.

The truth is that buyers can add a host of options. They can do this and still end up with a great performing Model 3 for much less than the Model S’ average $95,000 price tag, too. What it essentially comes down to is value for money. In that regard, the Model 3 is very considerate.

“As we continue to build our production capacity to meet the high number of advanced reservations, deliveries for for Model 3 orders placed today are not expected until mid-2018.”

Fair enough, but the company plans to push out half a million cars per year by the end of 2018. The newest “build your own Tesla” is a great idea, regardless. It is a blank canvas of car which can be customized to suit the owner’s pocket. Deterrents like getting the car a year after placing an order are momentary. Production, as Tesla has reiterated time and time again, will ramp up rapidly.

And who really cares if their car can not be equipped with a hospital-grade air filter? Can Tesla limit the new car to so few options forever? The answer is an obvious no. Whatever cons thrown at buyers now are only meant to keep that ever-growing reservation list in check. In a year or so, Tesla Inc. will find itself out of excuses for why people should prefer for the Model S over the Model 3.

One true downside: Tesla Inc has Model 3 buyers paying to recharge, too

After taking it away, Tesla revived its free, supercharging for life offering. Buyers need only get a referral from a current Tesla owner. Once that is done, they get a $1,000 credit on their Model S or Model X and never need to fret about paying to recharge.

This does not extend to Model 3 buyers, though, another obvious deterrent. But this one is major, as the prospect of never having to worry about recharging costs is more than attractive. Model S and Model X buyers qualify to do this. Model 3 owners, though, get just 400 kW of free charging per year. This equates to about 1,000 miles of free juice from Tesla Inc. (NASDAQ:TSLA). Buyers of the Model 3 pay for any use above that allocation.

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Mvusi Ngubane

2 Comments

  1. Yes, in their relentless pursuit of making the best cars they possibly can, Tesla will find that many prefer the Model 3 to the S even if they could afford the later. The Model 3 with dual motors and air suspension will simply be the “sportier” car, even if it is not faster 0-60 (which it might be) it will just drive more like a sports car due to weighing considerably less. Once autonomous comes along, the 15″ screen will become an entertainment center while the screens in the Model S and X, though larger, will be positioned the wrong way for watching movies and TV shows and not in the best viewing location for passengers in the rear. I suspect that Tesla will release an all-new Model S incorporating everything they have learned from the Model 3 and more sometime in the 2020 time frame. They also should have the new Roadster out sometime around then, and the Model Y and the Semi.
  2. Sometimes there are articles where it seems the author spent more time coming up with a title than in finding substance to write about. Free supercharging not being offered for the Tesla 3 is a ‘major deterrent’ to buying one? Then it should equally be a deterrent to buying ANY car in the whole world but Tesla’s S and X, right? Because aside from those two models there’s not a car on the planet where the manufacturer is offering free gasoline for life.

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