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Oils4AsphaultOnly said:
Here ya go. Best breakdown of potential costs and effect on profitability of the LeMR I've seen: https://teslamotorsclub.com/tmc/posts/3134655/

TL;DR: the new MR model is an attempt to maximize the number of cars they can deliver despite being constrained by current cell production capacity, while maintaining gross profit margin.
It seems to me that about the worst thing that could happen to Tesla right now is that they run out of customers for every Model 3 that they can produce. Lowering the minimum price point certainly is a move in the right direction to ensure that potential customers continue to turn into actual customers at a high rate.
 
RegGuheert said:
Oils4AsphaultOnly said:
Here ya go. Best breakdown of potential costs and effect on profitability of the LeMR I've seen: https://teslamotorsclub.com/tmc/posts/3134655/

TL;DR: the new MR model is an attempt to maximize the number of cars they can deliver despite being constrained by current cell production capacity, while maintaining gross profit margin.
It seems to me that about the worst thing that could happen to Tesla right now is that they run out of customers for every Model 3 that they can produce. Lowering the minimum price point certainly is a move in the right direction to ensure that potential customers continue to turn into actual customers at a high rate.

I don't think that would be the worst thing to happen to Tesla, but I know that's what the shorts want people to believe.

From an objective view, lowering the price point would indeed bring in more customers. But you can't jump to the conclusion on that data point alone.

Keep in mind that simultaneous to that introduction, the LR effectively got a price increase, as it's now AWD only. And the order split leans towards AWD ( https://teslamotorsclub.com/tmc/posts/3133060/ ), so people aren't mostly buying the cheapest model 3 yet.

Panasonic owned up to being the gating factor: https://arstechnica.com/cars/2018/09/panasonic-completing-3-new-cell-production-lines-at-teslas-gigafactory/:
" "In the interview, Panasonic automotive executive Yoshio Ito told Bloomberg that "the bottleneck for Model 3 production has been our batteries." Ito added, "they just want us to make as many as possible." "

Those 3 cell lines aren't scheduled to come online until the end of the year.

So if Fremont can build more cars than battery cells can be made? Why not reduce the cells per car (estimating at 20% less), so that more cars can be sold, bringing in even more revenue for Q4?

The running TMC joke is that LEMR = Limited Edition Medium Range, because as soon as those cell lines get up to speed, the MR will be pulled.
 
ISTM another reason to introduce the MR is that it was announced after Tesla set the earlier cut-off for getting a car delivered by the end of the year, and thus the $4k reduction helps to hide the fact that it will only qualify for $3,750 fed. tax credit. Tesla's showing prices on "Design your Model 3" page after the credit (and projected savings on fuel), rather than showing MSRP.
 
GRA said:
ISTM another reason to introduce the MR is that it was announced after Tesla set the earlier cut-off for getting a car delivered by the end of the year, and thus the $4k reduction helps to hide the fact that it will only qualify for $3,750 fed. tax credit. Tesla's showing prices on "Design your Model 3" page after the credit (and projected savings on fuel), rather than showing MSRP.

The MSRP is still visible at the bottom of the order screen. But I don't like the sneakiness of the "after fuel savings calculator" either.

And for california residents, you'll have a pretty good chance of getting it in time for the full $7500 fed tax credit. It'll be cutting it close for those further away.
 
Oils4AsphaultOnly said:
GRA said:
ISTM another reason to introduce the MR is that it was announced after Tesla set the earlier cut-off for getting a car delivered by the end of the year, and thus the $4k reduction helps to hide the fact that it will only qualify for $3,750 fed. tax credit. Tesla's showing prices on "Design your Model 3" page after the credit (and projected savings on fuel), rather than showing MSRP.

The MSRP is still visible at the bottom of the order screen. But I don't like the sneakiness of the "after fuel savings calculator" either.

And for california residents, you'll have a pretty good chance of getting it in time for the full $7500 fed tax credit. It'll be cutting it close for those further away.

Agreed, they stopped doing this for awhile. Not happy with the return to this practice.
Strikes me as a pure marketing move, typical of the industry.
 
Oils4AsphaultOnly said:
an attempt to maximize the number of cars they can deliver despite being constrained by current cell production capacity, while maintaining gross profit margin.
The MR with ~ $2000 less cell battery costs to Tesla is sold for $4,000 less. So Tesla net revenue drops $2000 per MR Vs LR.
The overall effect on Tesla is probably about neutral since the extra 5th car made and sold about covers the $2,000*4 lost net revenue
 
SageBrush said:
Oils4AsphaultOnly said:
an attempt to maximize the number of cars they can deliver despite being constrained by current cell production capacity, while maintaining gross profit margin.
The MR with ~ $2000 less cell battery costs to Tesla is sold for $4,000 less. So Tesla net revenue drops $2000 per MR Vs LR.
The overall effect on Tesla is probably about neutral since the extra 5th car made and sold about covers the $2,000*4 lost net revenue

have you factored in the higher factory utilization and its effect on COGS? it helps make up for the lower profit per car.
 
Now that the LR is only available with AWD, I wonder if you will ever be able to order one without the supposedly optional $5k premium package. As it is, the current base price for an LR is $55k. Also, now that they've come out with the MR, although it's by no means guaranteed it looks increasingly possible that we might see a repeat of the S with Tesla claiming that there were few people who wanted the SR, so going forward they'll only sell the MR/LR. That was more plausible with the S than with the 3. I don't know that they can pull that one off twice, when the SR was more or less claimed to be the mass-market-priced version, or a reasonably close facsimile. I imagine it depends almost entirely on whether Tesla can sell the SR at a profit, as well as the company being profitable.
 
GRA said:
Now that the LR is only available with AWD, I wonder if you will ever be able to order one without the supposedly optional $5k premium package. As it is, the current base price for an LR is $55k. Also, now that they've come out with the MR, although it's by no means guaranteed it looks increasingly possible that we might see a repeat of the S with Tesla claiming that there were few people who wanted the SR, so going forward they'll only sell the MR/LR. That was more plausible with the S than with the 3. I don't know that they can pull that one off twice, when the SR was more or less claimed to be the mass-market-priced version, or a reasonably close facsimile. I imagine it depends almost entirely on whether Tesla can sell the SR at a profit, as well as the company being profitable.

Although I agree with your speculation about the standard interior option (no info that I can find), there's no doubt about the SR version.

From elon's latest tweet, it's being pushed back to February:
https://twitter.com/elonmusk/status/1053061826794016769
"It’s a long range battery with fewer cells. Non-cell portion of the pack is disproportionately high, but we can get it done now instead of ~February"

What's battery related and is expected in February? https://electrek.co/2018/08/14/tesla-model-3-base-price-coming-new-battery-module-design/
"“We came up with a new design that achieves the same outcome, that’s actually lighter, better, cheaper and we will be introducing that around the end of this year – probably reach volume production on that in Q1 or something. That will make the car lighter, better, and cheaper and achieve a higher range.”

Worse case scenario as a buyer is being forced to get the premium interior making the base model 3 $40k, instead of $35k. Although it'll suck to be a buyer, Tesla should still have trouble meeting all the demand at that price point.
 
I know what they said, I also know what's happened in the past:
Standard Battery Tesla Model 3 Delivery Estimate: Just 4-6 Months
https://insideevs.com/standard-battery-tesla-model-3-delivery-4months/

. . . Tesla recently announced that is expanding its Model 3 family with a surprising new battery size version – Mid Range – and removed the rear-wheel drive Long Range version, the question now is when will we finally see the Standard Range version?

The official answer is 4-6 months, which could be February-April 2019, if there are no delays. . . .
So, we'll see.
 
GRA said:
Now that the LR is only available with AWD, I wonder if you will ever be able to order one without the supposedly optional $5k premium package. As it is, the current base price for an LR is $55k. Also, now that they've come out with the MR, although it's by no means guaranteed it looks increasingly possible that we might see a repeat of the S with Tesla claiming that there were few people who wanted the SR, so going forward they'll only sell the MR/LR. That was more plausible with the S than with the 3. I don't know that they can pull that one off twice, when the SR was more or less claimed to be the mass-market-priced version, or a reasonably close facsimile. I imagine it depends almost entirely on whether Tesla can sell the SR at a profit, as well as the company being profitable.
Tesla will continue to sell as a highly optioned 3 as possible until the demand is lesser than their production capacity.

Yes, eventually we'll see base $35k SR with no PUP. But only after all other options have been on sale through out the world for a number of quarters.

Because, the stock market demands profitability. That's the only way to get rid off the short sellers, who dictate the stock price now.
 
Oils4AsphaultOnly said:
SageBrush said:
Oils4AsphaultOnly said:
an attempt to maximize the number of cars they can deliver despite being constrained by current cell production capacity, while maintaining gross profit margin.
The MR with ~ $2000 less cell battery costs to Tesla is sold for $4,000 less. So Tesla net revenue drops $2000 per MR Vs LR.
The overall effect on Tesla is probably about neutral since the extra 5th car made and sold about covers the $2,000*4 lost net revenue

have you factored in the higher factory utilization and its effect on COGS? it helps make up for the lower profit per car.
A little, I suppose; but the net revenue appears to be pretty flat.
 
SageBrush said:
Oils4AsphaultOnly said:
SageBrush said:
The MR with ~ $2000 less cell battery costs to Tesla is sold for $4,000 less. So Tesla net revenue drops $2000 per MR Vs LR.
The overall effect on Tesla is probably about neutral since the extra 5th car made and sold about covers the $2,000*4 lost net revenue

have you factored in the higher factory utilization and its effect on COGS? it helps make up for the lower profit per car.
A little, I suppose; but the net revenue appears to be pretty flat.

If you're not convinced on the higher overall gross profit, consider the additional benefit of preparing the delivery chain for when model 3 production grows into the 10k/week rate. It'll be better if it ramps up gradually instead of in large fits and spurts.

Of course, in that view, it seems more like a trade-off, but all engineering decisions are trade-offs ... until something new (model 3 SR battery pack design) changes the equations.
 
Zythryn said:
Well, it isn’t the base model, but Tesla is now offering a mid-range version of the Model 3.
$4000 cheaper ($45k), 260 mile epa range, premium package RWD.
And, on Oct 24th, the price was raised to $46K: https://www.autoblog.com/2018/10/24/tesla-midrange-model-3-price-increase/.
 
evnow said:
GRA said:
Now that the LR is only available with AWD, I wonder if you will ever be able to order one without the supposedly optional $5k premium package. As it is, the current base price for an LR is $55k. Also, now that they've come out with the MR, although it's by no means guaranteed it looks increasingly possible that we might see a repeat of the S with Tesla claiming that there were few people who wanted the SR, so going forward they'll only sell the MR/LR. That was more plausible with the S than with the 3. I don't know that they can pull that one off twice, when the SR was more or less claimed to be the mass-market-priced version, or a reasonably close facsimile. I imagine it depends almost entirely on whether Tesla can sell the SR at a profit, as well as the company being profitable.
Tesla will continue to sell as a highly optioned 3 as possible until the demand is lesser than their production capacity.

Yes, eventually we'll see base $35k SR with no PUP. But only after all other options have been on sale through out the world for a number of quarters.

Because, the stock market demands profitability. That's the only way to get rid off the short sellers, who dictate the stock price now.

You might be right, but it's important to note that Tesla has always been valued more like a tech company than a car company. In the tech world, revenue matters much more than earnings. The $35K base model will generate a lot of revenue and investors may bet on the fact that Tesla will eventually figure out how to improve the manufacturing process to increase margins.
 
webb14leafs said:
The $35K base model will generate a lot of revenue and investors may bet on the fact that Tesla will eventually figure out how to improve the manufacturing process to increase margins.

1. It's still questionable whether a $35K will ever be available AND profitable for Tesla.
2. Remember, economy-of-scale reaches an asymptote quickly as a function of volume, i.e. at 5K-10K per week Tesla doesn't
gain much cost savings at a higher volume.
 
lorenfb said:
1. It's still questionable whether a $35K will ever be available AND profitable for Tesla.
2. Remember, economy-of-scale reaches an asymptote quickly as a function of volume, i.e. at 5K-10K per week Tesla doesn't
gain much cost savings at a higher volume.
They talked about that in the call. They expect to be able to produce the $35k version profitably in a few months. Note too that there will still be options available on the $35k model that will tempt many buyers, some may opt for the "stripper" but I'm willing to bet most will add on some goodies that provide extra margin.

Something else to consider, $35k is *not* a cheap car. You can buy a Corolla-Sentra-Civic sort of car for well under $20k, and an Altima-Camry-whatever type car for around $20k. There is a lot of room for profit in a $35k car if costs can be kept in line, which they seem to be getting better at.
 
Yes, but Tesla is counting on the "WOW" factor.... Just like diamonds.... You keep the introduction of new stock low, and the unit price stays up... And so does the "previously owned" market because "new" is not available...

For me, Tesla is like a beautiful woman... Expensive to buy, expensive to own, and everybody else wants her... I prefer common, hard worker that others won't notice too much... You can beat on her (meaning work, not abuse) and she will stay with you.
 
The enthusiasm for Tesla even in states that make it hard for them to sell ...
(map here: https://teslamotorsclub.com/tmc/threads/tesla-direct-sales-map-us.106111/ )
...shows the word of mouth (friends, clubs, forums) will continue to make Tesla successful. North Carolina recently organized a Blue Ridge Parkway ride where the 3 main clubs joined together to make it happen.

There were like 70 cars and more than half of them were Model 3s!

Check out the video below!

q0DsGZh.jpg


I did another road trip but this time to North Carolina via IN, KY, TN, VA. I went to a Tesla 'club' meet up that had lunch with almost 70 cars then a ride through the Blue Ridge Parkway. We went it groups of 20ish cars to follow the rules for that time of year. It was a week or two early for the leaves but turned out well. The blue lined map is part of my to/from drive down there. Charged in Bristol TN, Hickory NC on the way.

One picture is via my windshield but because I was driving and on AutoPilot I needed to pay attention to the road and was just snapping pictures with one hand holding the camera in a good direction ... otherwise, my other hand was on the wheel and I was paying attention to the road and other cars around me.

The video is from a local person who is a professional and was outside of the Parkway on a nearby road and the drone didn't cross the Parkway boundary.

erO3r4e.jpg


pV9CPAj.jpg


PwXSwta.jpg

Above via i1Tesla youtuber video: www youtube.com/watch?v=fCatpRO_i4M


[youtube]http://www.youtube.com/watch?v=sCdiqzdkWKY[/youtube]

Above video of:
2018-08-31_22-12-13.png
 
Tesla Faces Deepening Criminal Probe Over Whether It Misstated Production Figures
FBI investigation follows company’s settlement of separate civil charges with SEC
https://www.wsj.com/articles/tesla-faces-deepening-criminal-probe-over-whether-it-misstated-production-figures-1540576636 -- you may want to Google for the headline then click thru to get around their paywall

https://www.cbsnews.com/news/tesla-reportedly-faces-fbi-criminal-investigation/
https://www.engadget.com/2018/10/26/tesla-fbi-investigation-over-model-3-production/
 
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