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TESLA Drops Model Y price by 20%

15303 Views 248 Replies 65 Participants Last post by  Ev1st
This could mean a major challenge for TESLA financially. It means there is no profit to be made. However this will cut into ID.4 sale. Thoughts?

Tesla Inc. TSLA 0.28%increase; green up pointing triangle cut prices for some of its vehicles sold in the U.S. by nearly 20%, aiming to lure new buyers at a time Wall Street is concerned appetite for the car maker’s vehicles is weakening.
The cuts, which span Tesla’s lineup, are likely to allow some buyers to qualify for a $7,500 U.S. government tax credit.

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Reason behind is with so many decades in Auto industry.... running big huge factory requires minimum of 75-80% capacity to be running to stay positive....So what Tesla is doing is increasing volume and decrease margin, end result will be better if all key points are calculated correctly. And prime focus on EV i don't see Tesla running in any problems.
And Tesla dedicated charging network is just one of other sources of income not to mention all other assets that they are involved in.
And they had couple of good years of running higher than normal margins so now they can afford price reduction because of vertical integration and improving production costs.
I would not underestimate Tesla company ( and for one thing I give them big respect, they are inventors and not manufacturer that is buying out of the shelf hardware and making vehicles).
And any American should be proud of Tesla it is American made.
Manufacturers that produce big volumes may not have big margins, but they enjoy big business discounts on raw materials when buying in big volumes.... in car manufacturing business there is much bigger picture than just end result ( vehicle out of assembly line).
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All franchise should be axed and transform existing dealers in state of art service centers that are able to service any EV on US market...
Dealership's are nothing more but middle man that are living out of customers who buy new vehicle's ( I hope my dad doesn't read this).
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Folks should keep in mind too that Tesla is doing this knowing Equinox and Blazer are coming online soon and pose a major threat to Model Y supremacy.
New refresh coming up for Model 3 and probably Y will address more lean optimization and more efficient floor production.... Tesla has been ready for MSRP drop and competition. And they will come out with more affordable EV once they start pumping out CyberTruck. They are huge buyers of raw materials. And they have enough head start and time to bring big presses to start making chassis way more efficient than any other manufacturer right now.
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All people who complain about Model Y stiff suspension.
You should ask yourself simple question.
Do you enjoy quick acceleration and more stable vehicle on interstate with side wind that will make your hands tired because of constant steering wheel corrections.
If you do answer on any of these YES.
Then this is something that is part of design that will prevent vehicle from lifting front end and start loosing traction on front axle when accelerate hard.
Going with smaller diameter wheels and bigger tire sidewal will help with ride comfort....Going with huge wheel just for esthetic reasons are not giving you more efficient ride or comfort.
I find Tesla Y suspension with my German [email protected]& perfect....
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I believe GM is also doing that with either Cadillac, Buick or one of their brands with buyouts from franchisee.
Tesla is still ahead of all legacy manufacturers...they have no need to share portions of profit with dealers. And they have still more room for extra discounts. And as structural packs start coming on all models there is another way to make more money selling extended warranty insurances.
Difference between YP and 3P is all software and little changes in spring suspension and brakes. Model Y is less than 28k cost for Tesla.
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Not worth paying extra for can have this done on your own for much less.
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Be patient....there will be discounts in near future.
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Tesla is the “best user experience” someone said? Driving the car is where the “best user experience” counts imo and not the ability to better manipulate a computer display. YMMV
With my BMW iX M60 i have not yet once tried to use line assist or steering assist. It is way better feeling driving it by yourself it makes you feel alive and connected to the road. Doing double work and watching when steering assist will scream at you is not something i find relaxing. But the way how Tesla is configured it is not giving you choice to use vehicle to enjoy it. Not having foot brake blending, ability to disable emergency braking or disable regen is consistently fighting Tesla configuration vs enjoying your own ability to drive the way you want.
This will be hard pass for many car enthusiasts that had experience with ICE vehicles. Some people actually enjoy driving it without any nannies running. At least I'm one of this guys.
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I've followed Tesla closely for the last 5 years or so. When I bought my MYSR (standard range Model Y) the price had dropped to $39,990 and Tesla was STILL turning a profit then. I have no doubt Tesla could drop the price of the MYLR all the way down to $40K.. and still turn a profit. Considering they sell additional software.. (EAP, FSD, Acceleration unlock) and now charge expensive rates at most Superchargers.. they've got a pretty good money-printing machine going.

That said they do have to be careful about their position.. their designs are old.. their cars are aging.. features are steadily being removed instead of added.. and even AutoPilot is no longer unique. Won't take long before every manufacturer is selling an EV.. with a huge touchscreen and driving-assistance software. Tesla's one major advantage IMO is the Supercharger network.. and even then greed will take over. As Elon cannot resist accessing the $5 Billion in Government handouts that are waiting for companies who want to assist in building out the federally sponsored charging network that Biden has approved and Congress has made law. Expect the Supercharger network to add CCS connectivity over the next year or so.. and for non-Teslas to start charging at Superchargers a lot sooner than anyone thought.

Once this happens the reason to buy a Tesla will really be down to things like the smartphone app, OTA updates, FSD promise, performance and drivetrain. For the most part they are still leaders in this area.. but the competition is catching up quicker day-by-day.
Tesla Y is actually less expensive than Model 3.... and once they improve LFP chemistry ( for SR+ Model 3 there is enough space for one more long module to increase EPA)
They will have much cheaper vehicles.
In the near future they will have to lower MSRP more to have vehicles available biggest part of population that is looking between 30-40k MSRP. Munro provided prices are from 2 years ago.... they are much less than what he is actually providing. Tesla is also high volume buyer of aluminum and other minerals necessary for battery packs.
So there is another saving when producing vehicles at big volumes. And because of big investments in factories , battery plants and big presses there is no other way around to stay low volume high price producers. Because buying in big volumes materials and minerals brings huge savings..... look at Toyota for example.... they have the huge power in high volume purchases on materials needed.
I agree and he states in the video that they consider their pricing very conservative.
There will be another drop in price after March..... because of battery minerals restrictions and ability for people who are not able to take full advantage of 7.5k on tax returns.
Model 3 SR+ with LFP chemistry will definitely see another price drop.
In my opinion who is looking for long-term ownership or traveling many miles a year...LFP chemistry is much better than NMC.
Only disadvantage is more energy needed in the winter to keep LFP chemistry happy.
This year is going to be very exciting for future buyers, that have patience.
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I got MY23 Model 3 with LFP which now I can charge it to 100% instead of 80-90% for daily driving.
LFP are not any different than NMC chemistry....charging to full will degrade cells faster...reason why Tesla is doing this is because Tesla BMS is not accurate down to 1 mV accuracy to know exactly where in LFP flat curve is actual SOC.
Maybe but overall LFP are safer and last longer than NMC batteries.
I don't search Google for answers.... I do EV for living.... Probably next revision will bring updated BMS for LFP chemistry.....but what they are using now with LFP chemistry is not accurate enough. So Tesla marketing is advertising that LFP chemistry should be charged to 100% SOC....
but actually this is only way to keep BMS from drifting and not providing accurate SOC.
LFP chemistry has very flat curve that requires 1+/- mV accuracy.
They do last longer...but they have lower density.....higher demand for cells temperature management..... lower max..very sensitive at low state of charge output.....
more heavy. But in my opinion who is not after neck snapping acceleration and is after making many miles a year or keeping it for long-term are quite good value for the money. And hopefully in future Tesla offers replacement packs that will be much less expensive than NMC chemistry.
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