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This actually a price increase because of a loss of the federal tax credit... the title is bogus and should be changed imho. "Moving beyond the success of Q4,

This actually a price increase because of a loss of the federal tax credit... the title is bogus and should be changed imho. "Moving beyond the success of Q4, we are taking steps to partially absorb the reduction of the federal EV tax credit (which, as of January 1st, dropped from $7,500 to $3,750). Starting today, we are reducing the price of Model S, Model X and Model 3 vehicles in the U.S. by $2,000." http://ir.tesla.com/news-releases/news-release-details/tesla-q4-2018-vehicle-production-deliveries-also-announcing-2000 http://ir.tesla.com/news-releases/news-release-details/tesla... Edit: the mods changed the title. thank you!

izacus 8y ago
In what way is it a price increase, why did Tesla count tax credits when advertising price in the first place? Isn't that dishonest, since the cars price tag was higher and the government gave them money?
- Operyl 8y ago
  It was pretty obviously stated on their quoting tools, imho.
- Retric 8y ago
  Government did not give Tesla the money. Tesla also makes the actual amount you need to pay very clear before you buy a car. Their website is closer to the Cable companies landing pages that don’t include all the fees, before showing you the actual price at checkout.
- jpollock 8y ago
  The purchaser factors the tax credit in, so the removal of the credit will have the same effect as an increase in price. The salesman will _definitely_ make the purchaser aware of the credit, in the same way that a mortgage broker makes you aware of the tax benefit on mortgage interest (in the US). That doesn't make them dishonest.
  - FireBeyond 8y ago
    They also tried to include "cost of gas savings" in some of their "line item" website pricing.
    - waisbrot 8y ago
      TCO seems like an entirely reasonable figure to advertise. It's a hard number to trust, but I'm not sure how that gets fixed except by trying to regulate advertisement in general.
      - FireBeyond 8y ago
        I think putting a number of "$x" on a page, and only when you click into the details, seeing "Estimated fuel cost savings: $y" as one of the line items there is totally misleading. TCO is a reasonable figure to discuss, especially when changing paradigms. It's not, however, reasonable, to include in a line item for vehicle cost that is not in any possible practical way to attain (at least the fed credits are more concrete) - imagine you go into a Tesla dealership and it says "$35,000" and you say "Sold!", and they reply "Great, that'll be $38,000". "But...?" "Oh, that price was only to give you a TCO after you factor in three years of gas you're not buying now! It's not an actual discount or credit".
    - rconti 8y ago
      I, too, found this really odd. I was a reservation holder for the 3, and none of that garbage 'accounting' showed up when logged in. It was only when going to the PR-ified website for non-account-holders that I found the gas savings priced in. Strange. I don't disagree it's a relevant factor, but it's a bit disingenuous to list it like part of the MSRP.
  - gamblor956 8y ago
    Mortgage brokers also don't include the mortgage interest deduction when marketing mortgage rates or mortgage products, so it's not comparable.
BrentOzar 8y ago
> This actually a price increase because of a loss of the federal tax credit... the title is bogus and should be changed imho. The ceiling in the title refers to a ceiling of what customers are willing to pay. Tesla apparently believes customers won't pay the full price without incentives, so they're cutting the price they charge you. While it's an increase in the sense that the government stopped making it cheaper for you to buy a Tesla, it's still a decrease for Tesla as a company, and that's what has investors nervous. (Rightfully or not is another story.)
- andrewtbham 8y ago
  As of today Teslas cost $1,750 more than yesterday. It is effectively a price increase in the US. The tax credit went down, raising the price by $3,750. Tesla lowered the price by $2,000. $3,750 - $2,000 = $1,750 This doesn't signal a ceiling for price as the title implies. I implore the mods to change the title. It's misleading clickbait. You can tell from the url the original title was much more reasonable... "Tesla cuts prices as model 3 deliveries narrowly miss estimates"
  - baking 8y ago
    I clicked on the title ready to judge it as click-bait like yourself, but I think the text makes a good point that the majority of reservation holders seem to be willing to wait for their $35,000 Model 3s. Too bad they didn't get their $7,500 tax credit though.
    - andrewtbham 8y ago
      My main problem is with the title of the article... more than the article.
      - baking 8y ago
        I agree. At first glance, the "price cuts" wouldn't seem to signal anything. But the price cuts combined with the outstanding reservations does seem to imply more cost sensitivity than we have seen in prior Tesla sales.
mhermher 8y ago
Price increase for the buyer. Price reduction for Tesla, which is mostly what matters here if we are talking about the health of the company. Totally bogus though, you should submit it to Pravduh.
twblalock 8y ago
The price customers pay has increased but the amount of money that Tesla gets for each car has decreased. That reduces Tesla's revenue for each car so it is a price cut from the point of view of the company and its shareholders.

izacus 8y ago

In what way is it a price increase, why did Tesla count tax credits when advertising price in the first place? Isn't that dishonest, since the cars price tag was higher and the government gave them money?

Operyl 8y ago
It was pretty obviously stated on their quoting tools, imho.
Retric 8y ago
Government did not give Tesla the money. Tesla also makes the actual amount you need to pay very clear before you buy a car. Their website is closer to the Cable companies landing pages that don’t include all the fees, before showing you the actual price at checkout.
jpollock 8y ago
The purchaser factors the tax credit in, so the removal of the credit will have the same effect as an increase in price. The salesman will _definitely_ make the purchaser aware of the credit, in the same way that a mortgage broker makes you aware of the tax benefit on mortgage interest (in the US). That doesn't make them dishonest.
- FireBeyond 8y ago
  They also tried to include "cost of gas savings" in some of their "line item" website pricing.
  - waisbrot 8y ago
    TCO seems like an entirely reasonable figure to advertise. It's a hard number to trust, but I'm not sure how that gets fixed except by trying to regulate advertisement in general.
    - FireBeyond 8y ago
      I think putting a number of "$x" on a page, and only when you click into the details, seeing "Estimated fuel cost savings: $y" as one of the line items there is totally misleading. TCO is a reasonable figure to discuss, especially when changing paradigms. It's not, however, reasonable, to include in a line item for vehicle cost that is not in any possible practical way to attain (at least the fed credits are more concrete) - imagine you go into a Tesla dealership and it says "$35,000" and you say "Sold!", and they reply "Great, that'll be $38,000". "But...?" "Oh, that price was only to give you a TCO after you factor in three years of gas you're not buying now! It's not an actual discount or credit".
  - rconti 8y ago
    I, too, found this really odd. I was a reservation holder for the 3, and none of that garbage 'accounting' showed up when logged in. It was only when going to the PR-ified website for non-account-holders that I found the gas savings priced in. Strange. I don't disagree it's a relevant factor, but it's a bit disingenuous to list it like part of the MSRP.
- gamblor956 8y ago
  Mortgage brokers also don't include the mortgage interest deduction when marketing mortgage rates or mortgage products, so it's not comparable.

BrentOzar 8y ago

> This actually a price increase because of a loss of the federal tax credit... the title is bogus and should be changed imho. The ceiling in the title refers to a ceiling of what customers are willing to pay. Tesla apparently believes customers won't pay the full price without incentives, so they're cutting the price they charge you. While it's an increase in the sense that the government stopped making it cheaper for you to buy a Tesla, it's still a decrease for Tesla as a company, and that's what has investors nervous. (Rightfully or not is another story.)

andrewtbham 8y ago
As of today Teslas cost $1,750 more than yesterday. It is effectively a price increase in the US. The tax credit went down, raising the price by $3,750. Tesla lowered the price by $2,000. $3,750 - $2,000 = $1,750 This doesn't signal a ceiling for price as the title implies. I implore the mods to change the title. It's misleading clickbait. You can tell from the url the original title was much more reasonable... "Tesla cuts prices as model 3 deliveries narrowly miss estimates"
- baking 8y ago
  I clicked on the title ready to judge it as click-bait like yourself, but I think the text makes a good point that the majority of reservation holders seem to be willing to wait for their $35,000 Model 3s. Too bad they didn't get their $7,500 tax credit though.
  - andrewtbham 8y ago
    My main problem is with the title of the article... more than the article.
    - baking 8y ago
      I agree. At first glance, the "price cuts" wouldn't seem to signal anything. But the price cuts combined with the outstanding reservations does seem to imply more cost sensitivity than we have seen in prior Tesla sales.

mhermher 8y ago

Price increase for the buyer. Price reduction for Tesla, which is mostly what matters here if we are talking about the health of the company. Totally bogus though, you should submit it to Pravduh.

twblalock 8y ago

The price customers pay has increased but the amount of money that Tesla gets for each car has decreased. That reduces Tesla's revenue for each car so it is a price cut from the point of view of the company and its shareholders.