Bloomberg Reports On Soaring Tesla Model S Sales – Video

APR 11 2015 BY ELECTRICCARSTV 98

Soaring Sales?

Soaring Sales?

Interested in hearing Bloomberg’s take on soaring Tesla Model S sales?

Of course there’s Bloomberg video covering precisely that:

“Bloomberg’s Jamie Butters reports on Tesla Model S sales. He speaks on “In The Loop.”

The video includes some discussion on the newly launched Model S 70 D too.

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98 Comments on "Bloomberg Reports On Soaring Tesla Model S Sales – Video"

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Mark B. Spiegel

Sorry to step in here with some “facts for the fanboys” but sequential sales from Q4 to Q1 “soared” by slightly under 2%. The year-over-year gain came from a time when the company truly WAS “production constrained” (unlike now) and didn’t include any sales from Asia or the UK.

In order to make its 55,000-car guidance Tesla must now average 15,000 deliveries in each of the next three quarters, which represents 20% sequential growth from Q1 (again, vs. less than 2% from Q4).

This isn’t a knock against the car itself– it’s a fine niche (local & regional driving & a long-distance kluge for hobbyists) within a niche (cars costing over $75,000). I’m just properly characterizing the “business realities.”

I now return you to your regularly-scheduled fanboy programming…

Alonso Perez
Curious about your term “long distance kludge for hobbyists”. What does that even mean? A supercharger is slower than a gas station, but cleaner, not to mention free. A hobbyist is someone who makes a special effort to achieve a certain goal. That is, someone who does something that is not practical for people who are not interested in the activity of the hobbyist. Say somebody who plays vinyl records and thus has to clean them, replace the needle on his turntable, and that sort of thing. Is the use of a supercharger really less practical than pouring flammable liquid into a car at a smelly gas station? It’s not. It’s slower, but otherwise it is more practical and fits perfectly with the way most people travel long distance, unless they wear diapers and eat while they drive, which is both dangerous and sloppy. You can argue that long distance travel is a hobby if you own a short range EV like a Leaf, but for a Model S owner it isn’t. Also, an EV is more practical around town, since you never stop at a gas station. Can we now say that ICE cars are a hobby for urban… Read more »
Jay Cole
Mark, It isn’t my place to give advice in your business, but I think you would be better served to start looking at this (TSLA) as a sentiment/future valuation play on the Model 3, on a stand in Detroit, under $40,000 with a 200 mile range and a promise to be on sale in 2017, as opposed to anything to do with the Model S. I believe that is, and has been, the stimulus behind the market cap – not the current Model S and how its managed sales and production are doing vs Tesla’s own estimates. It seems foolish to peg any kind of value on such a predetermined metric, as Tesla is controlling both sides. The company clearly has a road map of staggered products (P85, leasing, P85D, 85D, 70D, battery product, 100d?, Model X, ?) to keep people engaged, sales incrementally rising, and to get from the Model S launch in 2012 to the Model 3 in a couple years. Tesla will have its day of expectations vs real world results…but I think that comes in 2017/2018. The company’s success or failure will be ultimately be measured against benchmarks hit or missed with the 3. Also, I… Read more »
sven

“But, one thing I was taught a long time ago (and that I still believe in), is that you should never own serious investments in a segment you have a personal connection with (ie-love or hate). . .”

I seem to recall a certain editor at InsideEVs investing in Fisker stock, and touting Fisker’s financial state and its cash reserves, which were many times greater than Tesla’s cash reserves at that time. Then again, maybe I’m just suffering from dementia 😉

Jay Cole

You may indeed be suffering from dementia sven, Fisker never offer any stock on the open market. Ever.

Full disclosure: The closest I have come to having a position in EVs was that I once had a very, very small position in A123 years ago (pre editor-in-chief duties @ InsideEVs) for a “fun gamble” that I repeatedly stated “no one should follow my example” as it would either “double or go to zero”…didn’t hold it very long though once it became apparent there was issues, (=

sven

Dementia it is then! My bad. Looking at old stories with a Fiskar tag, I think I “misremembered” your comments from these three stories. At the time, I think I was researching and deciding whether to pull the trigger and buy Tesla stock, so your comments stuck in my memory. I did end up buying, but in hindsight bought way too few shares. :-\

http://insideevs.com/who-will-supply-the-battery-to-the-fisker-atlantic-a123-if-they-want-to/#comment-122

http://insideevs.com/exclusive-fisker-atlantic-delayed-until-mid-2014-priced-50000-60000-more-specs/#comment-323

Not many comments/commentors in those very early days of InsideEVs!

Jay Cole
All good, no worries, (= The problem in the end with Fisker was that the gov’t money (529 million-192 drawn) got pulled out from under them when they couldn’t hit early production numbers because they had issues working out the software flaws (and ultimately launched too early anyway with them on board)…around the time the whole ATVML program was under pressure. When that happened the company was functionally dead. Tesla and Fisker had very similar early days, they both produced a low volume “show me” car (Tesla – Roadster, Fisker – Karma), then hoped to get private and gov’t funding before they went under to get them to the next car (Tesla – Model S, Fisker – Atlantic). As we all know the story, Tesla just eeked out survival at the last minute, and shortly thereafter the company’s market cap/brand has given them all the resources they need to get to the Model 3. (Fisker also had a 3rd car on their long-term plan as well) Fisker’s mistake in the end may have been in not going public as Tesla had, and/or making too ambitious of promises to the DoE (should have moved the delivery benchmarks back a 6-12 months).… Read more »
Lensman

Alonso Perez said:

“Curious about your term ‘long distance kludge for hobbyists’. What does that even mean? A supercharger is slower than a gas station, but cleaner, not to mention free.”

Mark B. Spiegel’s post certainly had a negative spin on Tesla, but it’s true that Supercharger charging is limited to a relatively few spots nationwide. Supercharger stations located 200 miles apart means you can be up to 100 miles from a station. By comparison, there are few paved roads in the USA where you’re more than, say, 20 miles from a gas station.

Speculawyer
“a long-distance kluge for hobbyists” I also take issue with this slur. The fact is that with an EV, you actually spend LESS time sitting around fueling & maintaining. With a gas car you need to fill it up every week or two. That includes the time to go out of your way for a gas station, time fueling, time paying, etc. All that time adds up. With an EV, you take 7 seconds to plug it in at night and 5 seconds to unplug it in the morning each day. It adds up but not to much. And with the gas car you need to get period oil changes that can take an hour or so. And you need to do a smog check in many places. You may also have to deal with exhaust repairs, tune-ups, etc. ALL of these things that you never have to do with an EV. So if you add up all the time getting gas, doing oil changes, smog checks, and other maintenance for a gas car, it ends being much longer than the time spent just plugging in at night for an EV. More than enough time to give a few hours… Read more »
Mark B. Spiegel
Jay, I don’t believe Tesla will be able to profitably build and sell a nice 200-mile EV for anything CLOSE to $35,000 and even if it could the stock would still be grossly over-valued at a current EV well over $30 billion. There’s nothing significantly proprietary here and the company will be buried by much deeper-pocketed competition. Do I know when the hinstitutional holders of this stock will wake up and realize that? No, but I do think it’s already happening (remember, the stock is way off its highs) and as the losses continue to accelerate so will that realization. I certainly think there’s a future for electric cars– I just think that Tesla will wind up being the proverbial “pioneer with arrows in its back.” Speculawyer: this “no maintenance for EVs meme” is nonsense (at least for Tesla). Anyone who owns one knows about a litany of issues (all taken care of under warranty by the company). Meanwhile, I have a 2013 vintage ICE car and the primary requirement is an annual oil change @ 10,000 miles. It happens to be a high-performance car using hydroscopic brake fluid so it also recommends a biannual brake fluid change and spark… Read more »
Jay Cole

Hey Mark,

That is a viable position, and a definite possibility about the Model 3. Future prospects for EVs is a very loose and changing landscape.

However using current/Model S sales (whatever they might be) as a reflection of the value of the company are immaterial to even your own position as to why the company isn’t worth the value it trades on – a product that as yet to come market.

The fact that Tesla makes or loses $250 million this year matters not at all to its value. Tesla trades on the prospectus of selling hundreds of thousands of 200 mile Model 3s.

If you want to effect the value of the company to justify your position (which you took up way too early ahead of market sentiment…which can be a bugger to allow for), you have to rally against/find evidence of one of three things with the Model 3:

a) falling behind schedule,
b) not coming to market under $40,000,
c) has no viable market to enter in order to achieve the volumes/profitability expected.

These are the factors that have, and will, influence the valuation…not if Tesla hits or missing Model S sales this year by a couple thousand.

Mark B. Spiegel

Hi Jay,

I’ll tell you why I disagree with you: the entire value of this company is based on pie-in-the sky promises from Elon Musk about what will happen in the year 2025, and yet Musk’s much nearer-term guidance– in terms of timelines, sales and financial losses– has continually been missed and I believe will continue to be so. So at what point do sophisticated institutional investors (the ones with pockets deep enough to REALLY prop up the stock price) stop believing in the guy’s promises? I think that has already started to happen and will accelerate. Also, the company is encountering a real cash crunch and will have to sell lots of dilutive stock later this year and– probably– again next year, and that in itself is price-pressuring.

Jay Cole
I’m not sure we disagree Mark, one has to have a very skeptical eye on any high volume, all-electric promises…as the segment has clearly not justified any previous expectations for other cars. In hindsight, we can tell you took up your position far too early…but not that it is ultimately wrong. Your position now is that you are “think (ing) it’s already happening” in terms of a change of sentiment. However, you have to weigh that short-term position against the fact that Tesla has barely promoted, and not shown the Model X at all, and have done even less with the Model 3. But that those events are coming soon. In evaluating risk vs reward on the short side in regards to sentiment turning negative and then staying there for a prolonged period, you have to consider what is the ‘risk’ to that changing sentiment you are counting on, when the Model X arrives and gets promoted in the summer? and the Model 3 debuts (along with all the talking points) in ~8 months? In all likelihood you would have been doing a favor to yourself (and your clients) if you had waited until Tesla had spent all its ammo… Read more »
Mark B. Spiegel
>> In hindsight, we can tell you took up your position far too early…but not that it is ultimately wrong.<< Well technically this is correct, but I've also averaged the position up in the high $200s, and ironically have a blended basis right around where the stock is now, in the $210s. However, more to the broader investing point, it's a giant leap for you to say that Tesla's current $30 billion+ enterprise value hasn't priced in huge success for both the Model X and the Model 3. I don't know how old you are or how long you've been investing (or at least observing), but in "non-bubble-market" times there's a concept whereby all of the known news is priced into a stock and thus it tends to "sell on the news." I fully acknowledge that in a central bank-induced bubble such as this one there are no guarantees of that, but I *can* guarantee that there isn't a single institutional investor who'd own this stock at the current valuation or higher who isn't well aware of– and fully expecting– successful introductions of the Model X and Model 3. However, if Tesla only delivers 10,500 to 11,000 cars in Q2… Read more »
Jay Cole
Well if you have been averaging up that means your position has grown considerably over time, for (by your own admission) no gains the last couple years…and now you have taken on an even greater risk event for your clients into the X/3 events. I have a decent understanding of market fundamentals, but I am no professional by any stretch. Sometimes I think smart people overthink things, and want to act just for the sake of doing things. The market has been going up steadily on sentiment for ages, so I have been long in boring positions like ETFs (SPY, QQQ) and don’t lose any sleep over them. There is/has been no need to “get fancy” with hybrid positions at all in the past SEVEN years. Everyone and their dog is making 20-25% a year on the market while inflation is at ~2%. Here is the S&P over the past SEVEN years…why would any sane, long term investor not just ride this train until it shows sings of faltering? Sometimes you need professional managers to assist you in making money with advanced solutions, but right now simple market tracking is netting an absurd 10-15x inflation. For right now, and the… Read more »
Mark B. Spiegel

Jay,

Without getting too much off track here, you could have (and most people did) said the exact same thing in early 2000 and late 2007. Bull markets offering returns that FAR outstrip the growth in GDP tend to come to very abrupt and ugly ends. The current one is based entirely on something that by DEFINITION is a massive bubble: short-term interest rates that are set well below the rate of inflation. So you’re playing a game of musical chairs and planning to grab one just before the music stops and maybe you will and maybe you won’t, but I invest based on where I think things will eventually wind up (and can at any moment) without playing the dangerous game of trying to guess what happens in between.

Jay Cole

I’m not sure how stating that a 300% gain over 7 years in the most obvious (and common) investment out there is to be discounted and marginalized by a future event that might or might not be personally avoided by myself is an argument of merit…but I fully agree markets like this end – it is inevitable.

However it is only greed and an intense desire to continue historical returns that see people lose as they continue to hold the same securities that have worked in the past without building in any security mechanisms into their portfolio.

In my opinion, an attempt to ‘time’ the end of a multi-year rally/bubble is a fool’s errand – regards if you are a professional or not…you are better off to always go with the trends (positive or negative) while at the same time giving away a few percentages with small hedges in place against a serious opposite event to cover yourself and just enjoy the ride. That has been basic investing 101 since the 2000 event.

Again, we can agree to disagree on this one. To each his own, (=

Bonaire

On many carnival rides, eventually the bolts do fall off and people get hurt.

ffbj

Since you have publicly stated that you are short Tesla you views are slanted by your own predilection to see it falter. Thus any good news is really not all that good, and any bad news is blown out of proportion to the downside. Although personally I think the stock is overpriced I would not have temerity to bet against it.

Mark B. Spiegel

Jay,

Lol, okay, let’s “agree to disagree.” When the market was down almost 10% in October and 5% in January, how did you know that neither one of those was “the big one”? You know “the big one” is inevitably coming and yet (presumably) you rode out a nearly 10% correction that could have become a 35% correction. This is what people did in the very overvalued markets of early 2000 and late 2007– they rode it out and -10 became -20 became -30 became -40.

Anyway, thanks much for the dialogue!

Jay Cole

***mod edit (Jay Cole)***

You are right, we are getting sidetracked…going to pull the rest of the thread from here. Probably not the best to get into specifics anyway, (=

(But to your question, that doesn’t exist here anymore lol, 3% is my max allotment loss for a hedge on an annualized basis…so I basically have torched that amount every year of late)

***mod edit***

Mint

It’s not based on 2025 promises. It’s based on a maybe 50% chance of success for 2020 potential.

TSLA will easily be worth $200 with 200k Model 3 sales, some powertrain sales, and some grid product sales (all spinning reserve will be replaced by battery systems, and most companies with high demand charges will also be installing them). They don’t need to hit 500k.

You also underestimate TSLA’s first mover advantage. No other automaker even has plans of building a 100kW+ charging network, because they believe more in PHEV (understandably so) or that EVs don’t need it (Nissan). They’re going through middlemen for batteries and often for electronics/motors.

For the other automakers, the pure EV market is too small and too much of an uphill battle (due to image, infrastructure, and/or being late) to care about. Tesla will get its 0.5% of world auto market share with little competition. Beyond that prospects are hazy.

Mark B. Spiegel
Mark B. Spiegel

P.S. That article– which I wrote almost two years ago– was WAY too low on the sharecount (the fully-diluted figure is already 144 million and will soon be climbing) as well as on the company’s debt, which is $3 billion and by Q1 2016 will all be “net.”

Alonso Perez
I disagree on several points: Deeper pockets: The competition has deeper pockets but also deeper spending needs for a given unit of engineering. The traditional car companies are much more bureaucratic and change averse. If you look at the Leaf, for example, the motor, inverter, etc. have been built to resemble a gas engine, and are mounted the same way at the factory. This does not really make any sense; it’s not optimal packaging for an EV. Software, a big part of future cars, is a weak point of the majors. It’s not a core competency and virtually no auto executives have software experience. Tesla is the reverse: a creature of Silicon Valley with a CEO who knows how to code. Software is notoriously difficult to develop with normal engineering management tools, which is why it tends to suck on regular cars. Maintenance: The Model S is the company’s first mass-produced car and there is certainly a learning curve they had to go through. They knew this, which is why they ramped up production as gradually as they did. More recent cars have far fewer issues. You should not count on the model III being troublesome. It will be the… Read more »
Mark B. Spiegel

>>People who claim that Tesla has losses don’t seem to be able to differentiate between capex and operating expenses.<<

Oh, I can differentiate quite well. Can you? In 2014 Tesla had a $187 million GAAP operating loss INCLUDING $152 million of ZEV credit sales. If you net those out the "actual business" lost $339 million.

As proof that the company is moving in the wrong direction and exhibiting NEGATIVE "scale," in Q4 GAAP loss was $108 million including $86 million of regulatory credit sales. If you add those back in (reflecting how the company truly did as "a business") the Q4 GAAP loss alone was $194 million.

NOTE: GAAP earnings account for expansion capex by allowing the gradual depreciation of the capital equipment over a reasonable lifetime; i.e., it's not "expensed all at once" against revenue.

ADDITIONAL NOTE: If Tesla DIDN'T spend a lot of money on expansion CAPEX it wouldn't have the massive "growth multiple" that it currently does (even though sequentially speaking it's barely growing, and in fact due to the 70D may show a Q2 or Q3 revenue DECLINE vs. Q1, along with even higher losses).

Evfans

How much did GM get from taxpayers?

Alonso Perez
GAAP is problematic with Tesla because of their pseudo-lease accounting. If you believe, as I do, that the resale value guarantee will turn out to be a non-issue (that is, that it will incur no cost to the company), then the non-GAAP numbers are actually more realistic. Of course, you may not believe that and think that Tesla will take a bath on resale value. Time will tell on that one. I am also not sure why people like you consider the ZEV credits to be somehow not worthy of being considered “business” revenue. The money is real enough and the service Tesla is providing in order to get it is real too. The ZEV credit is designed to address direct and easily measured health-threatening local pollution. There is zero doubt that each EV represents one less pollution source at the local level. Sure, the ZEV credit is a result of government action. But let me ask you, when Boeing sells a plane to the Air Force do you consider that not to be “business” revenue? How do you determine this? Better yet, are the companies >buying< the credits not incurring cost of doing business? ZEV credits are a part… Read more »
Mark B. Spiegel

>>Of course, you may not believe that and think that Tesla will take a bath on resale value.<>I am also not sure why people like you consider the ZEV credits to be somehow not worthy of being considered “business” revenue.<<

Because it's not SUSTAINABLE revenue. As all the major manufacturers begin to roll out their plug-in cars (both hybrid and pure EV), the resale value of those ZEV credits will decline precipitously.

Mark B. Spiegel

Sorry, my “resale value” comment somehow got deleted: yes I think Tesla will take a bath there and in fact it already is as the “D” cars are driving down the value of the 2WD models and now I think the S70D will REALLY kill them.

Mike989

The 70D will drive sales, that can hardly kill them.

People lease a Tesla, in the price range, more as a convenience. So, that they don’t have to buy and then sell a used car. Can you image a rich person putting in an ad and taking appointments for people to see a used car. It simply isn’t done.

Now, if this were a Nissan Leaf, then possibly lower value for a used Leaf by a better new Leaf might affect sales.

That’s not going to be the case with a Tesla, not with the “Best Car” Consumer Reports has ever tested.

Alonso Perez

Tesla is developing in stages and revenue that is available now need not be relevant in five years. ZEV credit revenue is real today, end of story. Future revenue is predicated on the Model X, Model III, Gigafactory OEM sales, and Energy Storage sales. Three of these five items are not currently generating revenue. Tesla is not at steady state so there is nothing sacrosanct about the current revenue mix.

As to your estimation that the 70D will crater the used 2WD prices below the guarantee, I say maybe. One reason is that the guarantee is actually a bit of a gimmick. It is quite low because all luxury cars lose so much value. IIRC it was 43%. I don’t think that’s a particularly high bar to achieve. Also note that the 70D is an excellent deal but has nevertheless raised the cost of entry to a new Model S.

One of us is going to have to mark our assumption to market. We shall see within a year or so.

Mark B. Spiegel

>> ZEV credit revenue is real today, end of story.<<

It's likely to be a lot less real this year than it was last year, and much less real than that next year. Is this year and next year "today enough" for you? Of course, if you own this based on the 2025 numbers we don't have a lot to discuss, considering that in mid-2014 the company couldn't correctly forecast its full-year 2014 numbers and I guarantee you that either next month or at the Q2 earnings call it will substantially reduce its 2015 guidance, so if you think it has any idea what it will be doing ten years from now, well, you stay long (I assume you are) and I'll stay short!

Alonso Perez
Noted. I have no current position, BTW. I got in at 28, exited at 87 (yup, missed a ton of upside, but hindsight is 20/20). Since December or so, put in a chip or two long in the 180’s and short above 220. I think it’s orbiting 200 till the Model X is out. It’s little money, this is a dangerous stock on either side. It is, however, reasonably safe for long longs, guys who buy the stock and forget about it, if they take care not to pay top dollar. I think shorts expecting it to collapse are dreaming. Oil is at $50, the Model X is delayed, China was reset, and the best you can do is 180 or so? Think about it. That’s should be a tell for you. If you are short and those items start flipping, you will lose money in a hurry. I think longs tend to get ahead of themselves too though: the valuation is certainly too high to expect major moves without major progress. I believe Tesla will meet its broad objectives, perhaps a little late, but they will. I believe there is a good chance it will become a major automaker… Read more »
Mike989

As Warren says: “You buy the management.”.
This is the most successful Entrepreneurial manager the USA has the pleasure of watching.

Mark B. Spiegel
>>I think shorts expecting it to collapse are dreaming. Oil is at $50, the Model X is delayed, China was reset, and the best you can do is 180 or so? Think about it. That’s should be a tell for you.<< I know for a fact that the deep-pocketed institutional investors who own this stock have done pretty much NO homework on the emerging competitive landscape. As Musk's credibility continues to unwind (did you listen to the Q4 conference call?), the losses continue to escalate (Tesla is showing NEGATIVE scale) and those institutions start to see what VW Group and a bit later Mercedes & BMW have on the horizon (as well as the Bolt and 200-mile Leaf on the low end), they'll start to rethink this thing. In fact, one could argue that they already are, as despite the recent rally the stock is way off its highs. Also, think about the large number of luxury plug-in hybrids coming out over just the next 12 months. While none of them will be big sellers individually, each one will chip away at a handful of Tesla sales, and yet a company priced for "perpetual hyper-growth" that's selling fewer than 3500… Read more »
kdawg

One big advantage Tesla has over the competition (and future competition) is the Supercharger network. And that sort ties into your comment about long range travel. Now, will everyone that owns a Tesla take advantage of the network? No. But everyone that has home-fire insurance also doesn’t take advantage, but it’s still nice to have that insurance.

Until the competition comes up with BEVs with longer ranges, better performance, and a network of DC fast charging, Tesla will be king. But Tesla’s Achilles heel is their prices, and hitting every target date late. It will be interesting times in 2018.

Anon

Someone’s been sniffing too much gasoline when they fuel up…

I should start a chapter of “Fossil Fuel Addicts Anonymous”, and wave your membership fee– so we can get you the help you clealy need.

LuStuccc

Mark. You’re so wrong on a fundamental point:
There is no “deeper-pocketed competition” because they simply DO NOT WANT TO COMPETITION EXCEPT TO KILL TESLA.
For the obvious reason that they shoot themself in the foot introducing real good EVs.
Their ICE business is way too profitable and they team with big oil on this.
We pay too much for inefficients complex cars that don’t last and poison our air.

See Through

“..EXCEPT TO KILL TESLA.”
ROTFLOL! That’s the most paranoiac statement I heard in a while! Elon himself said that Daimler’s loan saved Tesla more than the DOE loan. Listen to the video interview of this year’s Detroit auto show. And you say they want to kill Tesla? Real funny.

LuStuccc

Daimler and Toyota gave contracts to Tesla before Tesla was perceived as a serious threat. If you stop rofl, you will notice that both have cut all links now.

Lensman

Gosh yes, traditional auto makers aren’t at all worried about competition from Tesla. That’s why so many State auto dealer association are suing Tesla to keep them out of their State.

Oh, wait…

Speaking of ROTFL: I guess that’s what most readers do when they see (or see through) one of your desperate short-seller attempts to bash Tesla.

energymatters

Assuming you own a home and have a regular place to charge, Renters don’t have that option. Since the % of renters is 38% and growing (per Census) and per UCLA Luskin Center research more than 2/3rd of buyers interested in EVs are renters while 95% of the actual current buyers are homeowners this is a big issue. We need more access to charging for renters and we can see a 3X increase in the market for EVs.

We also need to see faster, =standard AC=, charging as that serves 100% fo the market vs fractional market DC services.

Tesla could really help the market if they took their Superchargers and made available fast L2 and chaedemo at them as well.

Mike989

Which explains the 70D.
-More then sufficient range for most people,
4 wheel drive, with more standard equipment.

More buyers will select this option as the car is now more viable at a lower price. I can option up a 70D respectably from around $80,000.

The lowest price for the 85 would have been $90,000.

George Bower

The video claimed that after you buy all the extra goodies the 75 turns to 85K$+. I went to the site and specked one and it didn’t seem like there were that many things to add. I believe the SC network is included in the price Yes?

Also all these reporters keep saying he’s raised the price but it’s more of a price reduction. The D option and an extra 10 kwh is worth way more than 5000$ IMO.

George Bower

just went to the site and SC is std. Also, again, I didn’t see any options I couldn’t live without. The only option I’m not sure about is a manual adjust on the suspension ht but I think that is standard. It’s the smart air that is the option.

anybody know?

OlderThanDirt

Standard suspension would be coil spring. Smart air is just what it says it is. Ride height is adjustable manually or automatically by GPS location. (i.e. steep driveway entrance) Depends on your need or preference both are very good. Even a base equipped Tesla is a very fine ride!!

Mike989

The air suspension is hands down better, but that’s why it’s an option.

Options:
– The glass roof, it’s stronger?!?, you can put a bike rack on this roof.
– Next Gen Seats
– Autopilot convenience

Mike989

Autopilot convenience control: Includes traffic-aware cruise control. ( NEEDED )
– Air Suspension: Wanted. Best suspension.
– Ultra High Fidelity Sound: The car is so quiet, why wouldn’t you put in the best stereo, unless you don’t drive much.

So a 70D actually costs: $90,200, including destination.

I’m not complaining, just noting that if you’re going to buy a Tesla, most people are going to buy the experience.
For around $90,000 actually.

Alonso Perez

I get $79K. Multicoat red and “advanced” tan leather seats. That last option is mostly because I don’t like black interiors. If a light fabric was available, I’d go with that. The difference between the new leather seats and the old ones is only $750, so that’s why the “advanced”.

All the other stuff I can live without. Lighting package is just for show. Air suspension is just another thing to break down. I’m sure it improves the ride, but not really worth it to me. 21″ in wheels mean more tire wear and I’m not going to race the car. Pano roof is the only one I’d be on the fence about, especially now that it’s cheaper. So that’s $80,500 before the credit. The 70D is a lot of car for that money. It’s a an amazing deal if you can afford it.

kdawg

It’s a nice product, and I can afford it. I just don’t want to spend that much on a car. It’s the same reason I didn’t sign up to buy an Apple Watch.

Alonso Perez

If you don’t want to spend that much on a car, then you can’t afford it. By afford I don’t mean to have the literal capacity to buy it. I mean the ability to buy it without feeling that you are spending more than you should. Probably a lot of people can literally afford an 80K car, but they would have to give up more than they want to elsewhere in their lives.

kdawg

Um no. Warren Buffet is a billionaire. There’s lots of things he can afford that he doesn’t waste his money on. They are not the same thing.

Alonso Perez

Yeah, my formulation is flawed.

The point I was trying to make was that affordability, beyond the obvious test of having the minimum required money, is not an absolute concept. It’s pretty elastic because it involves perception of value calculations for different options. I am sure people have bought Teslas, or other cars, with income that others would consider insufficient, because they’d rather have a bigger house, a bigger investment portfolio, or whatever the case may be.

One of the harder tradeoffs is safety. The Model S is turning out to be a very safe car. What is that worth?

Hey_Hey

@Alonso

That’s a fairly absurd comment. There are lots of things I can afford that I don’t think are worth it. For example, I can afford to buy name brand Advil but I choose to buy generic ibuprofen because the added sugary coating isn’t worth 2x the expense. Regardless of how much money I make, that extra $3 could be used elsewhere in a more productive manor.

Mark Hovis

A lot more layers than that. Like Kdawg, I purchased a Volt opposed to a Model S. I am a Tesla fan boy and think the Model S is a great luxury class auto. I felt like the Volt was much easier for others to understand as a transitional EV and could see themselves spending that kind of money. I think the 2016 Volt will continue to do that, but I will probably choose to support the Model III in my next purchase. And being that the only option I purchased on the Volt was a Bose radio, I bet Mr. Spiegel that I buy a Model 3 inside 37K. People who buy the Model III will choose a lot less options than those who purchase a Model S. I am betting that the Model III easily sells 100,000 the first year in. Whether Tesla sells 500,000 by 2020 is an entirely different story. Bottom line, no one is going to know where this company goes before 2020.

Alonso Perez

I’d be surprised if your Model III costs less than $40K. I’m guessing the $35K base will not include supercharging, for example. I’m also going to guess that options will be designed to achieve an ASP closer to $45K, and given the pricing of the S, the Model III will go all the way up to $70K at least.

I’m pretty frugal myself but would be surprised to spend less than $5K in options in the Model III. The base model will be kitted out like a rental car, a fleet car. Private owners will overwhelmingly choose at least one or two significant option packages.

Mike989

If you can afford it, but the payments are what’s holding you back. Did you look at leasing?

That’s what you really want to do.
Less expensive, and you want to ride the Tesla Upgrade train. But, it’s 3 year with a $6,750 due at signing.

Never the less, you’re leasing America’s Best Car.

kdawg

I like the interior of the Volt much more than the Model S. The Model S is too big of a car for me as well. I paid cash for my Volt. I think, currently for me, it’s America’s best car. But it’s different strokes for different folks. I’ll be shopping the Model 3 if/when it arrives. If Tesla goes longer than their usual delays, and it’s well past 2018, I’ll get a Chevy Bolt instead. All depends on how the cookie crumbles.

Mike989

As for the Apple Watch,
there’s going to be released a new app, that will let you know 2 weeks before it happens, you’re going to have a heart attack.

When that app is available, and you’re over 60, well, it’s a No Brainer.

But, I’d wait for version 2.0 until that app is available.

Acevolt

I completely agree. The fact that all the goodies I would want are including in the base price, means the only thing I would want is a color and maybe leather. The following are included in the base price:

Free long distance travel on the Supercharger network
Maps and navigation with real time traffic updates
Automatic keyless entry
Daytime running lights
GPS enabled Homelink
Parking sensors
Blind spot warning
Lane departure warning
Power-folding and heated side mirrors
Automatic emergency braking

mike w

I agree its actually a price reduction. The only take back was they eliminated the upgrade to Michelin tires.

Nicholas

Too much negativity and opinion. Who pays these guys?

Tesla is an amazing, fast, sexy vote for our climate.

Mark B. Spiegel

>>Tesla is an amazing, fast, sexy vote for our climate.<<

Hi Nicholas,

70% of the electricity in China comes from coal and yet Tesla is doing everything it can (so far with limited success) to sell cars there. As a coal-powered Tesla is far more polluting than a modern emission controlled gasoline engine, do you think it's environmentally responsible for the company to attempt to put as many Teslas as possible on the road in China before that country is getting vastly more electricity from renewable methods?

Bryan

You are right, 70%, but you are also overlooking that China is installing renewable wind and solar faster than the rest of the world. Their real CO2 output dropped 2% for 2014. At that rate a change is coming, fast.
How electricity is being generated is changing throughout the world. I am in the renewable energy and I am going to Honduras, Barbados, The Dominican Republic and Puerto Rico next month all to set up PV installation companies. Some are large utility sized arrays and others are distributed roof top installs. All are very cost effective and ecologically sound investments for these nations. We are also setting up new distributors in Mexico as solar PV is strong and growing stronger there as well. I see the Model 3 a very important next vehicle. I feel that Tesla is leading the automobile industry down a path that they wouldn’t go on their own accord.

Mike989

China is dropping in 2.1Gigawatt of new solar just this year.

Searched High and Low for the Worse example possible? Not the average, not the median or mid point, you searched for the Statistical Outlier to make your point.

My Republi-dar is flashing Emergency Red.

This is another reason why the Republa-whores get no respect.

Mike989

Here’s a joke: Which state is the Most Terrified that people on welfare are booking Cruise Ship vacations with welfare benefits?

Kansas: The state, literally, 1000 miles away from an ocean passed a law that people on welfare cannot book a cruise ship.

No Proof that anyone actually did. Just HYSTERICAL Idiotic Senility that someone might.

And you Repubs complain that no one smart gives you any respect, while you Troll your own base.

LuStuccc

Hi Paid Mark, even with the worst electric mix in the US, WV 96% coal a Tesla emits nearly half the CO2 of a similar ICE (MB S550).
And an EV *NEVER* contribute to city SMOG!

China is shifting it’s energy sources to renewables much more rapidly than here.

Mark B. Spiegel

1) You’re ducking my question: with 70% coal now and, probably, still 60% even ten years from now, is it environmentally responsible for Tesla to be pushing cars there NOW?

>>even with the worst electric mix in the US, WV 96% coal a Tesla emits nearly half the CO2 of a similar ICE (MB S550). And an EV *NEVER* contribute to city SMOG!<<

This is contrary to everything I've read. Kindly point me to a responsible study that says a coal-powered Tesla is environmentally better than a 2015 emissions-compliant controlled gasoline vehicle.

Lustuccc

Kindly point yourself with all the lies you spread! Lol!
Not one single link. After you dear…

1) “is it environmentally responsible for” …(pick ANY ICE car maker : the worse polluters ever!) Lol! You make my day! Ha! Ha! Ha!

Mark Hovis

It was originally thought that China would not start coal reduction before 2020-2025. Recent reports indicate that it could be beginning now on a more aggressive time frame. http://www.independent.co.uk/environment/climate-change/china-agrees-to-impose-carbon-targets-by-2016-8626101.html

But there is a more glaring equation missing in your statement and that is the correlation between EVs and PV. It turns out in the US market, 30% of EV owners CHOOSE to take control by offsetting their carbon footprint with their own solar array. China is well aware that the pollution from coal is killing its citizens. There is no reason to believe that a Chinese Tesla owner will be that much different from other markets.
http://insideevs.com/ev-almost-always-greener/

Mark B. Spiegel

>>in the US market, 30% of EV owners CHOOSE to take control by offsetting their carbon footprint with their own solar array. China is well aware that the pollution from coal is killing its citizens. There is no reason to believe that a Chinese Tesla owner will be that much different from other markets.<<

Well, here on planet earth (or should I say "country China"?) there are at least two problems with that nice theory:

#1) Most of the wealthy Chinese who can buy Teslas live in apartment buildings.

#2) Many cities are too smoggy for solar energy to be efficient.

Again, we're a little bit off topic here but the biggest problem for China is coal plants and older, non-emissions-compliant diesel trucks. Let me put it to you this way: how much of a problem these days is smog in Los Angeles or New York City? The reason is that new cars and trucks are pretty damn clean and the older ones are gradually heading off into junkyards.

Mark Hovis

Here on planet earth in country China there are plans to expand solar 67% in 2015. Though the numbers are small, the percentages are significant and are moving ahead of EVs in the same pattern that occurred in the US. http://www.bloomberg.com/news/articles/2013-01-30/china-to-boost-solar-power-goal-67-as-smog-envelops-beijing

I have spent time in NY, Los Angeles, Beijing and Chengdu and am well aware of the differences in smog in each of these areas. It may surprise you that the Chinese will not be stumped by the chicken-or-the-egg syndrome. So to your question, yes it is an appropriate time to buy an EV in China. Selling Tesla’s in China is an entirely different matter “currently”. I consider their stumble in this market their largest set back, though with only six months in, it is really too early to throw in the towel.

Mark B. Spiegel

>>So to your question, yes it is an appropriate time to buy an EV in China.<<

Your logic is flawed. What happens 10 or 20 years in the future is irrelevant to what kind of car should be driven TODAY. It won't make sense to use a new EV in China instead of a new, emissions-compliant gasoline powered car until the EV is likely to be charged via natural gas or renewable energy. Thus, until it's no longer likely to be powered by coal, from an environmental standpoint it shouldn't be used. If you can't understand that simple logic, I can't help you.

Mike989

No, you forgot the efficiency of the electric motor vs. the gas engine. One is 90% efficient the other is 20% efficient.

You know this has been debunked 1000 times already, and yet you Repubs simply have a brain block about this.

Then too, EV’s displace the pollution of an ICE, but not only that, but for every 6 gallons of gas you don’t burn, there’s an Additional 1 gallon of energy you didn’t burn to refine the gas.

The energy needed to make oil into gas, and maintain it’s infrastructure dwarfs the electric infrastructure needed. So, with every EV there’s an incremental decrease in the massive cost of:

Ships, trains, pipelines, refineries, ports, refinery tanks, truck transport fleet, gas station tank storage. All this costs money and energy too, and all this can be reduced to zero with EV’s.

An EV economy vs. an ICE economy.
There is no comparison as to which is more efficient and cleaner. Electric is 95% cleaner and more efficient.

Also NO IMPORTs needed of any foreign oil.
Energy is produced domestically, growing the local economy.

Mike989

Just add up the Steel needed to produce and maintain the ICE fuel infrastructure. Steel is one of the most intensive users of energy.

Mark Hovis

He doesn’t know. He is a stock analyst, not an engineer or scientist. One who writes for seeking alpha tells you all you need to know.

Steve T

Quit bringing politics in to this.

Paul

What’s this 70% coal BS? Coal has 31.9% share. Sources of electricity were fossil fuels 67%, renewable energy 16% (mainly hydroelectric, wind, solar and biomass), and nuclear power 13%, and other sources were 3%. The majority of fossil fuel usage for the generation of electricity was coal and gas.
Electricity generation – Wikipedia, the free encyclopedia
en.wikipedia.org/wiki/Electricity_generation

Mark B. Spiegel

We’re talking about China here:

>>Despite an expected rapid increase in installed capacity scheduled in 2014 for both wind and solar, and expected increase to 60 GW in nuclear by 2020, coal will still account between 65% and 75% of capacity in 2020.<

http://en.wikipedia.org/wiki/Electricity_sector_in_China

Nick

Keep in mind, gas is refined with that same coal fired power grid.

If electric cars lower demand for gasoline, the savings from refining alone greatly improve the emissions story.

In addition, EVs decouple your energy source from the vehicle, making large scale changes to the same much easier.

OlderThanDirt

People like to conveniently forget about the gas pumps long tailpipe.

Mike989

Not only did Mark B. Spiegel forget that, he conveniently forgot the massive destruction of freshwater from pipeline leaks and train derailments.

Why do you think Red States were fighting the Keystone XL? Because of the “I don’t give a fuck” maintenance attitude of pipeline corporations. With their track record of a Monthly pipeline accident, all fresh water supplies, in Farm and Ranch country suddenly become High Risk of having fresh water supplies polluted and destroyed.

We’re talking about Bankruptcy Risk.

JeffS

Mark: Are you considering the emissions resultant from the production (drilling, transport, refining, transporting, pumping, etc) of the gasoline used for each of these “2015 emissions-compliant controlled gasoline vehicles”? Please look up the “VOLTS FOR OIL” video on youtube for a eye opener.

Mark B. Spiegel

>>Our approach combines spatially, temporally, and chemically detailed life cycle emission inventories; comprehensive, fine-scale state-of-the-science chemical transport modeling; and exposure, concentration–response, and economic health impact modeling for ozone (O3) and fine particulate matter (PM2.5). We find that powering vehicles with corn ethanol or with coal-based or “grid average” electricity increases monetized environmental health impacts by 80% or more relative to using conventional gasoline. Conversely, EVs powered by low-emitting electricity from natural gas, wind, water, or solar power reduce environmental health impacts by 50% or more.<<

Translation: if your EV is powered by coal-fired electricity you're better off with an emissions-compliant gasoline car. On the other hand, if your EV is powered by natural gas or renewable energy, the EV is cleaner. As right now in China 70% of the electricity comes from coal, broadly speaking the country will be better off with modern emissions gasoline cars than EVs:

http://www.pnas.org/content/111/52/18490

Alonso Perez

That report, and others like it, ignore the fact that most EV owners charge their cars at night. This turns out to be relevant because coal plants run 24 hours a day regardless, as they have so much thermal inertia that shutdown and start up require hours. This is why nighttime electric rates are so cheap.

So an EV owner concerned about his CO2 footprint due to living in a coal area need only charge at night, as most do naturally anyway. This is essentially free electricity from a pollution standpoint, since it would have been generated anyway.

The report also ignores the correlation between EV ownership and solar panel ownership, though it is true that this aspect would be a lot less relevant in China. However physics is the same in China, so night-time charging has the same advantage.

Mark B. Spiegel

>>coal plants run 24 hours a day regardless…<<

I'm no expert in this but it's my understanding that coal plants can be (and are) throttled back at night, and thus while the furnaces are still on they're running at a much lower level that's roughly adjusted to meet demand. Don't get me wrong– I think coal is awful and MUST be phased out, but if it *is* throttled back at night it's a strike against electric cars in China until it's been mostly replaced with cleaner sources. I mean, maybe a handful of cars can soak up the baseline night-time generation, but if too many are added the plants may need to burn MORE coal.

Lensman

Some coal-fired power plants are indeed “throttled back”, or rather the boilers are run at a lower temperature, at night. Others, the “base load” power plants, are run at a constant temperature. It’s actually not very efficient to try to cycle down most older coal-fired plants, because the boilers take several hours to cool off, and some time to heat them back up. So many run at a constant temperature 24/7 for maximum efficiency.

As a result, there’s a lot of night-time excess capacity in coal-fired power plants. Of course it depends on what area the EV owner lives in, but in many areas he can take advantage of this excess capacity, causing the power plant to generate little if any more emissions than it would if the EV wasn’t being charged at all.

Naturally, this fact is something the EV bashers would like us to ignore… just as they want us to ignore the rather massive amounts of electricity consumed in refining gasoline and diesel.

JeffS

Mark, you’ve dodged a key question? How many kwh of coal generated electricity does your gasoline car consume? We are just talking about the refineries here, for convenience we will omitt the energy used to drill, pump, transport etc (that hidden energy usage resultant from pulling hydrocarbons out of the grounds & getting it to the gas pump).

Mark B. Spiegel

Jeff,

I’m not dodging anything. It’s all covered in that recent report from the National Academy of Sciences to which I provided a link.

JeffS

Mark: For now I’ll have to take your word for it that somewhere in “spatially, temporally, and chemically detailed life cycle emission inventories; comprehensive, fine-scale state-of-the-science chemical transport modeling; and exposure, concentration–response, and economic health impact modeling for ozone (O3) and fine particulate matter (PM2.5)” they have included refinery emissions into their assessment. For the time being I am glad that the grid in my state charging my Th!nk City EV is rated “Best” here: http://www.ucsusa.org/clean_vehicles/smart-transportation-solutions/advanced-vehicle-technologies/electric-cars/emissions-and-charging-costs-electric-cars.html#.VSqTE_nF_8k

JeffS

Mint

There is no such thing as a coal powered Tesla except in your flawed mind.

Do you think China is going to be building more coal in 5 years to meet new electricity demand from EVs? Wind is both cheaper and quicker to build.

Same in the coal heavy US states. Look at all new capacity additions to meet new demand. Virtually none of it is coal. It’s all NG and renewables.

In 10 years, China will likely be building molten salt nuclear, too.

Alonso Perez

“As a coal-powered Tesla is far more polluting than a modern emission controlled gasoline engine”

That’s false and has been debunked many times. Well to wheel, a 100% coal-powered Tesla is merely equivalent to a modern gasoline car, including embodied energy. It is not better but it is by no means worse. However, it is still better for the local urban environment, particularly compared to diesel, even the cleanest diesel.

At any rate, China has adopted a rapid and extremely ambitious path towards renewable energy, so every Model S sold there will get cleaner and cleaner with every passing year.

martinwinlow

“As a coal-powered Tesla is far more polluting than a modern emission controlled gasoline engine…” If you think the EV Vs ICEV ecological argument is this simple you are truly deluded. We get it… You think Tesla is going to go bust and we ‘fan boys’ are not interested in how much T’s stock is worth or much else as far as making money is concerned.

What we ‘buy into’ is the simple fact that with a relatively small extra expense the energy that our EVs use can be completely offset by our PV arrays on our roofs. Bye-bye coal, bye-bye Big Oil and all the ghastliness it represents in the world today – pollution, war, perverted politics etc etc. Perhaps you should spend some time taking a look at the bigger picture instead of spending it all trying to make yet more money?

V. Bowman

Clearly there is another agenda here than his simply ‘making money’ given the time and energy spent trying to disprove simple physics (EV vs ICE…been done over, and over). If Mark is TRULY only interested in the financials then he is reading all the wrong info and seriously deluded. Given the short position and Q4 valuation given above, he won’t be making bank anytime soon. Good luck Mark…though I honestly doubt that has anything to do with your true motives for posting here. Ahem!

Lensman

Mark B. Spiegel said:

“As a coal-powered Tesla is far more polluting than a modern emission controlled gasoline engine…”

Well, I see now that you’re just another short-selling Tesla basher. What a load of complete B.S. your post is.

The Union of Concerned Scientists says:

“Electric cars produce less global warming emissions than the average gasoline car, no matter where in the U.S. you live. For more than 60% of Americans, the emissions of an EV charged on the regional power grid are lower than the best gasoline car.”

Lower than the most fuel-efficient gas guzzler, and -much- lower than the average. Some areas of the USA, such as West Virginia, use just as much coal in their mix of energy sources for electricity as China does. So, Mr. Spiegel, your assertions here are pure FUD, without a speck of truth.

http://blog.ucsusa.org/usa-today-gets-it-wrong-the-benefits-of-evs-636