Tesla Increases Prices for Existing 2008 Orders - Page 16

vfx · 01-22-2009, 12:35 PM

ABG on Tesla having a Town Hall meeting
Tesla calls Townhall meetings after email fails to calm angry buyers - AutoblogGreen

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...what is fast turning into a PR nightmare...

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The ineffective email attempted to explain the price increases...

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Don't forget to tune in next week for another episode of "As the Tesla Turns."

DDB · 01-22-2009, 01:40 PM

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Originally Posted by vfx

No one would consider a down payment on Tesla's next car without seriously considering that they will be bent over after tying up $25,000 for two years.

Add to that the "company fail" possibility, the bad juju that will will fester over the internet and mainstream press, the next two bonehead moves (they average about one every 6 months) and the possible problems the Roadsters might have after 2 years.

A new car company with a terrible track record with customers will keep them away in droves.

I'm with vfx on this one. I'd forget about even a deposit on the Model S, because I don't want to pay $92,000 for a car that is supposed to be in the ball park of $55-60K. Cobos (maybe) and I may shell out some deposit money for a Volt because GM understands bad PR when Tesla has shown what it can do to it's core customers (early adopters willing to risk it all). No chance I'd put any money down without driving away in a Model S. Okay, start GM bashing--but perhaps they were smarter to wait to take deposits if they do?

flabby · 01-22-2009, 01:46 PM

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Originally Posted by James

I think that is exactly correct. They need to show that the Roadster business is profitable per unit by some percentage. Even if 50 Roadsters are cancelled, that likely is worth the short term pain to get to profitability. Those people at $92,000 would be replaced by owners at $109,000.

James, I think you last sentence sums things up well. What's to keep Tesla from doing this same thing in the future to the $109,000 owners, or the $125,000 owners, or the future sedan owners. Yes, perhaps they needed to show profitability on their current cars to get the loan, but why weren't the current locked in owners included in on that decision? Why did musk's explanation/repair email come after everyone lost their cool, not before. This may blow over, but unless tesla fixes this, I doubt it will be for a very long time. And to add to the situation, unless there is a fix to the problem, I don't see how litigation can be avoided.

graham · 01-22-2009, 02:22 PM

This might work out well for Tesla.

1) They get rid of the 400 or so customers of which they are selling the car for less than they would like. (they may or may not decide to refund their deposit).

2) They immediately get to the 2009s who are paying them more, and because they started out at a higher price, are less unhappy.

3) They use this window of time while they are working through the 2009 backlog to secure 400m from the Govt because they are currently profitable.

4) They live off of those loans until they can produce the Model S, or have ready-to-buy Roadsters in the showroom.

If that works for them, great. Bad PR on this may dry up a lot of potential new orders for the Roadster... so worst case scenario is they will have to just live on Govt loans until they have products people can buy from the show room instead of trusting that the price / features / performance will not change on them between purchase and delivery. They no longer need happy customers or advocates if the government will float them for long enough for the scandal to blow over.

Tdave · 01-22-2009, 03:08 PM

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Originally Posted by Tesla Dave

I'm a middle of the pack 2009 "owner" who has $60k on deposit. The first $5k deposit locked in price. The next $55k locked in a production slot. I have the 2009 price list on file that they sent me with my welcome package, and also saved from the website at the time I gave my deposit. That price list includes items on it that have now increased in price.

I fully expect Tesla to honor the prices on the price list that I locked in over 6 months ago. That's the whole point of the first $5k deposit that LOCKED IN PRICE. I'll repeat. The whole point of the first $5k deposit is to lock in the prices on that price list.

I have an answer to this direct from Tesla. The $5k initial deposit from us 2009 owners that locked in price did indeed lock in price, but only the base price, not the options. This is the reason they didn't actually raise base prices, but did all the price adjustments on the options.

TEG · 01-22-2009, 03:53 PM

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Originally Posted by dpeilow

I don't think its about whether Elon or anyone else could have thrown in another $3m, but about showing ongoing profitability on a per unit basis. I'm not an economist, but this is my understanding of their explanation.

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Originally Posted by James

I think that is exactly correct.

Note, I said the same thing a couple of days ago in this very topic.

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So, this isn't just about funneling more investor money into the company - it is about showing that their current business model is viable, and that the government will back them up for the next step.

DaviddesJ · 01-22-2009, 03:59 PM

Getting rid of the early customers who preordered at a low price might actually be good for the company. But a lawsuit by those customers almost surely won't be.

TEG · 01-22-2009, 03:59 PM

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Originally Posted by Tesla Dave

I have an answer to this direct from Tesla. The $5k initial deposit from us 2009 owners that locked in price did indeed lock in price, but only the base price, not the options. This is the reason they didn't actually raise base prices, but did all the price adjustments on the options.

The problem, as has been stated, with that logic is that some standard items were turned into optional items. You thought the now optional wheels were coming with your locked in price. You thought you would be getting that SolarPlus Windshield, the HPC and the Homelink too. With this logic they can turn anything into an option at will and change what you actually get. It may be more about expectations than legality, but still I can see why this ended up upsetting many. Unfortunately this also turned into an opportunity for the Tesla naysayers to pop back out of the 'woodwork' and start taking potshots again.

Tdave · 01-22-2009, 04:37 PM

TEG, you're exactly right. I didn't say I agree with the reasoning and logic of the statement. I was simply reporting more info that came from a Tesla representative. It's more info to fill in the puzzle. I remain most puzzled by the company's audacity and arrogance.

I will add this, though. After my phone call with the company, I will certainly hold final judgment until after the town meeting. There was a hint that Tesla will bring some sort of compromise to the table at the town meeting. I'll believe it when I hear it.

stopcrazypp · 01-22-2009, 05:19 PM

Tesla admits to underpricing Roadsters, still hopes profitability is near - Engadget

Another article on this. Notice all the naysayers popping up. Besides from addressing this issue with the customers, Tesla also has to deal with a lot of negative press now.

Hopefully they can work something out with the customers which doesn't ruin the reputation of Tesla and can still provide revenue for Tesla.