Gen III Range & Pricing Speculation

[moollar]

I think I'd be perfectly happy with Supercharger access only, and not because I need it but for future resale value. The base car is going to be light years beyond what I drive now, and I'm sure many in the Gen3 market might feel the same.

I know what you mean about being light years ahead, but I would also need the Supercharger access. It's not unusual for us to drive about 1,000km (~600 miles) each way to my parents each year at least once, plus other long distance trips. Using the spreadsheet pricing clmason has above, I would probably choose something around the $45k range if I can afford it (which would probably translate to something over AUD$60k including shipping and taxes using current exchange rates).

 

[Chris Naps]

.. the goal was to get a $35k car in 3 years, not a $45k car. They might be production constrained in year 1, but it could cause some PR issues if the car appears to cost $10k more than they promised...

I agree with you. This could cause the stock to go bearish if statements cannot be met. People will be less willing to purchase a $45,000 which is only the base model, when they can get a fully loaded Lexus, Mercedes, BMW, or Audi ... for that price. When the Gen III comes out, Tesla will not be dealing with "Tesla enthusiasts" , they will be dealing with actual people who only care for the price and not the product. And once the tax credits are over, I have a feeling that the price would have to be around $35,000 because it will scare people away if not. The same goes with Solar. In New Jersey (Where I live) the state offered 75% of the cost of solar to be subsidized. It was great because that allowed it to be affordable, many people jumped in line for that tax credit. Once the credits were over, a large decrease in the amount of solar panels sold occurred.

With a $35,000 - $7,500 = $27,500 for a Tesla. That is beautiful. But that can be a problem when the tax credits fade out. There would be no incentive to purchase an electric car besides for the sheer amazingness. Many people will be fine with a BMW, Mercedes, Lexus, Audi because of the convenience of gas and range.

Time will only tell!! And I hope that people will evidently fall in love with this car. I can only hope for a coupe Model E!

And why on this price sheet does it show Supercharger access to be less than $1,500?? To enable Superchargers on a Model S it is $2,000 - $2,500.

 

[moollar]

And why on this price sheet does it show Supercharger access to be less than $1,500?? To enable Superchargers on a Model S it is $2,500.

It's only $2,500 if you are enabling it after purchase. It's $2,000 if you do it at purchase. I think you're right about supercharger access at $1,295 being a bit weird though. They may reduce the price to, say $1,500 due to higher volumes, but below that seems more like wishing than reality. Though, we could both be wrong (very happy to be!). We don't know all of the economics of working out supercharger access pricing.

 

[JRP3]

With a $35,000 - $7,500 = $27,500 for a Tesla. That is beautiful.

That is also unlikely to happen since the tax rebate phases out after 200K vehicles are produced by a manufacturer. Tesla has publicly stated they are not counting on the rebate for the Model E.

 

[Chris Naps]

It's only $2,500 if you are enabling it after purchase. It's $2,000 if you do it at purchase. I think you're right about supercharger access at $1,295 being a bit weird though. They may reduce the price to, say $1,500 due to higher volumes, but below that seems more like wishing than reality. Though, we could both be wrong (very happy to be!). We don't know all of the economics of working out supercharger access pricing.

This is true! I would suspect more superchargers to be placed (which are not indicated on the Tesla Motors website that show the 2015 supercharger map) I feel as if Tesla hits the ground running with vehicle requests which might blow predictions out of the water - more Superchargers in close proximity of each other might evidently become a reality because of the shortage of charging spaces. This would cost more and most likely raise the price of the $1,500 Supercharger access price.

That is also unlikely to happen since the tax rebate phases out after 200K vehicles are produced by a manufacturer. Tesla has publicly stated they are not counting on the rebate for the Model E.

Yes, if they sell a total of 200,000 cars, but at the rate they are at - it would be impossible for them to sell 200,000 cars by 2016. Their production rate is capped until the Gigafactory is built. I feel the first hundred thousand early subscribers (pre-orderers) will be the people who have the tax credits, and then it will be over from there (FYI I BE ONE OF THEM!!) But that is Federal rebates, not including state.

 

[dhanson865]

I created a Gen 3 option and pricing chart.
View attachment 44344

My build would be

Blue Paint $495+ (I'm guessing this would be more like $750)
Fuel Effecient tires $800 (I'd only get them if they extend range / increase efficiency)
Supercharger $1295 (I'm guessing this would be more like $1500)

I'd add wheels only if they offered an Areo option and I'd be fine if those wheels were 17" instead of 19" so I could buy cheaper/more common fuel efficient tires. I'd have to see them at $1000 or less.

I'd be fine with Aero wheels + Efficient tires bundle at say $1500 or $1750.

I'd consider a cold weather package if it meant that I'd be getting a heat pump based AC/heater system or if that was the only way to get heated seats. I'm not concerned about my side view mirrors or windshield wipers being heated.

I'm on the fence about a paint armor option. It'd depend on the price of the option and the price of the vehicle.

On the topic of tires/wheels I'd like to see smaller diameter and width rims stock and optional on the mass market Tesla. For both cost and efficiency / range.

Oh and I wouldn't be able to claim the entire $7500 rebate unless my income increases a bit between now and then but what guarantee do we have that there will be a $7500 rebate for EVs in 3 years time?

 

[JRP3]

Yes, if they sell a total of 200,000 cars, but at the rate they are at - it would be impossible for them to sell 200,000 cars by 2016. Their production rate is capped until the Gigafactory is built. I feel the first hundred thousand early subscribers (pre-orderers) will be the people who have the tax credits, and then it will be over from there (FYI I BE ONE OF THEM!!) But that is Federal rebates, not including state.

First, I don't expect to see more than a handful of E's in 2016, if any, and their rate certainly better not be capped at current levels since they are projecting 35K S's for this year and a higher number of S's and X's for next year and into the future. If you take the 25K S's from 2012 and 2013 + 35K S's for 2014 + around 50K S's + X's for 2015 + at least 80K S's and X's for 2016 there won't be many E's getting the full fed tax rebate, and I'd expect most of the early E's will not be $35K base models. So don't count on the full fed tax rebate for the E.

 

[aronth5]

Lets hope Tesla can actually deliver a $35k model without smoke and mirror pricing just to avoid the Tesla bashing if they cannot meet that price.
That being said I suspect the percentage of people who actually end up buying the lowest cost base model will be less than 10%.

 

[JRP3]

At one point Elon was saying "$35K in today's dollars", so potentially that could translate to around $38K or so by the time the car is released, although he's dropped the qualifier lately, so who knows.

 

[Reykjavik]

The key factor to me is price comparison to ICE vehicles. That means you have to take fuel and maintenance into account. If gas prices rise by 30% before the Model E comes out, $40k is plenty price competitive. $35k is a good goal, but there is some room for slippage in the price. What Tesla needs to do is bring the price of quality electric vehicles down, rather than getting the same value, just a lower price and less good vehicle.

 

[stopcrazypp]

Lets hope Tesla can actually deliver a $35k model without smoke and mirror pricing just to avoid the Tesla bashing if they cannot meet that price.

The people bashing Tesla are already expecting "smoke and mirrors" (aka including the federal tax credit). And I believe most people believe it's going to be a stripped model.

 

[Kevin Harney]

The people bashing Tesla are already expecting "smoke and mirrors" (aka including the federal tax credit). And I believe most people believe it's going to be a stripped model.

I don't understand what the big issue is with advertising a base price model. All cars do it. Why should Tesla have to be different ? Of course you don't get a loaded version for $35K.

 

[stopcrazypp]

I don't understand what the big issue is with advertising a base price model. All cars do it. Why should Tesla have to be different ? Of course you don't get a loaded version for $35K.

I have no problem with it either, but there are some analysts who assume the $35k is the average selling price and then wrote articles about how that's impossible, for example here:
http://green.autoblog.com/2014/02/26/why-teslas-35000-model-e-pipe-dream/

 

[Kevin Harney]

I have no problem with it either, but there are some analysts who assume the $35k is the average selling price and then wrote articles about how that's impossible, for example here:
http://green.autoblog.com/2014/02/26/why-teslas-35000-model-e-pipe-dream/

Well we all know what happens when you assume..... You can't fix stupid.

 

[ckessel]

First, I don't expect to see more than a handful of E's in 2016...

I'll don't expect an E in 2016, period. Tesla's Roadster was late. The Model S was a couple years late from their original guess at a release date. The Model X is at least a year late (originally "late 2013" was mentioned). There's no reason to think that the E will meet it's guesstimated 2016 date. I won't be surprised if first deliveries don't happen until 2018.

 

[Zaxxon]

First, I don't expect to see more than a handful of E's in 2016, if any, and their rate certainly better not be capped at current levels since they are projecting 35K S's for this year and a higher number of S's and X's for next year and into the future. If you take the 25K S's from 2012 and 2013 + 35K S's for 2014 + around 50K S's + X's for 2015 + at least 80K S's and X's for 2016 there won't be many E's getting the full fed tax rebate, and I'd expect most of the early E's will not be $35K base models. So don't count on the full fed tax rebate for the E.

Remember that the credit does not actually end when Tesla hits the magic 200,000 vehicles produced number. (See Section 2 of that link) For the calendar quarter where they hit 200k and 1 quarter following, the credit is unaffected. For the 2 quarters following that, the credit is 50% ($3,750). In the 2 following that, it's 25% ($1,875). If Tesla hits 200k in late 2016 as you postulate, the full credit would be available through 3/31/17, and some level of credit would be available through 3/31/18. So if the E is produced in late 2016/early 2017, there is ample opportunity for a prospective purchaser who is paying attention to have a good shot at placing an E order and receiving the credit so long as they get on the E reservation list quickly once it's available.

 

[timf]

Remember that the credit does not actually end when Tesla hits the magic 200,000 vehicles produced number. (See Section 2 of that link) For the calendar quarter where they hit 200k and 1 quarter following, the credit is unaffected. For the 2 quarters following that, the credit is 50% ($3,750). In the 2 following that, it's 25% ($1,875). If Tesla hits 200k in late 2016 as you postulate, the full credit would be available through 3/31/17, and some level of credit would be available through 3/31/18. So if the E is produced in late 2016/early 2017, there is ample opportunity for a prospective purchaser who is paying attention to have a good shot at placing an E order and receiving the credit so long as they get on the E reservation list quickly once it's available.

Another huge factor to remember when it comes to the tax credit is that only cars sold in the U.S. count towards the 200,000 total. Tesla plans for about 2/3 of their production going forward to be for overseas markets. Even if S and X production gets up to 90,000 units a year by the time the Model E hits the road, that's only 30,000 cars going towards the U.S. market. It will likely take a full year of Model E deliveries before the tax credit starts to phase out. I anticipate Tesla will take advantage of this and price the car slightly higher for early adopters at least as long as the federal government is throwing money back at consumers.

 

[Zaxxon]

Very good point.

 

[JRP3]

Indeed, I hadn't thought of the foreign sales issue, though I was aware of the gradual phase out of the rebate.

 

[Zaxxon]

So, taking this to its logical conclusion, here's an estimate of the tax credit status using estimated sales #s from the Morgan Stanley report (which uses N America vs US, so this is still not entirely accurate. I imagine Canada/Mexico sales are quite small vs. USA though, so it should be relatively close).

2012/2013: 22k
2014: 20k
2015: 38k
2016: 46k
2017: 85k
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211k, implying phase-out begins 3/31/18 @ 50%, 9/31/18 @ 25%.