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So presumably they are hoping many $35k buyers will be tempted by the $37k which presumably has a better margin for Tesla

ivalm 8y ago
Yup, the availability of "nice feature for 2-4k more" really drags up the price. I started looking at $35k, ended up wanting the $47k.. but that's a $12k increase...
bowmessage 8y ago
Especially if the range limit continues to be imposed only by the car's software.
- doctorhandshake 8y ago
  From what I was told at the dealer, the software range limit was only on the Model S produced during a certain span of time and now all long-range Teslas have larger batteries than their stock counterparts.
  - cma 8y ago
    There was an X too and a second different Model S with it.
pcurve 8y ago
I don't think anyone will actually buy $35k model. They made it so undesirable that it's almost laughable. Reminds me of 2004 Honda Accord DX model with $16995 with roll-up manual windows, plastic hub caps and manual tranny that hardly anyone bought. Most will opt for $40k premium model. Though 37k is much better value, it's missing the core features that tickle fancy of Tesla buyers. Standard Interior Includes: Manual seat and steering adjustment Cloth seats and base trim Basic audio Standard maps and navigation Center console with storage and 4 USB ports Partial Premium Interior Includes: 12-way power adjustable heated front seats Premium seat material and trim Upgraded audio – immersive sound Standard maps & navigation LED fog lamps Center console with storage, 4 USB ports and docking for 2 smartphones Premium Interior Also Adds: rear heated seats Premium audio – 14 speakers, 1 subwoofer, 2 amps, and immersive sound Satellite-view maps with live traffic visualization and navigation In-car internet streaming music & media Internet browser Location-aware automatic garage door opener
- elipsey 8y ago
  I drove a couple of Hondas like that, and I kind of liked them. Ever try replacing a window motor? :)
  - pcurve 8y ago
    Old Civic DX, CX, back in the days when they put double wishbone suspension on them.
  - macintux 8y ago
    > roll-up manual windows, plastic hub caps and manual tranny Two of those I don't care about, and the manual transmission is a big win for me, so yeah, I'm with you.
- gizmo385 8y ago
  > it's missing the core features that tickle fancy of Tesla buyers Can you clarify what you mean here? I would think that the "core features that tickle fancy" would be things like autopilot, but that's an expensive add-on package regardless.
- dsfyu404ed 8y ago
  Manual everything tends to be popular with the "I don't want a bunch of shit breaking when this vehicle is old" crowd. If I had ~40k burning a hole in my pocket I'd get the base spec with the big battery and all the self driving bells and whistles. I can see the most basic model with the biggest battery being popular with the kind of people who buy an accord and put 200k on it over 8yr.
- davidgould 8y ago
  I drove a 1994 Honda Accord DX stick for 20 years. It had 247000 miles on the meter when the dash stopped working three years before I replaced it with a Chevy Spark EV. Great car, it was still on the original clutch although it was using a bit of oil. Now I have a Model 3 Performance because it’s amazing, it’s what I was saving for driving the Accord all those years.
- leesec 8y ago
natch 8y ago
At only $2,000 more I doubt it has a better margin. I think they just want more buyers to be happier with their purchase, while still providing the $35k option they promised for those who prefer to stick strictly to that price regardless of features.
- elihu 8y ago
  It wouldn't be surprising if the 240 mile range battery and the 220 mile range battery are actually the same part. (As I understand it, there is a trade-off between battery wear and what voltage you change and discharge to. So, the people with the "low capacity" battery may benefit by having a somewhat longer overall usable battery lifetime.) If that's the case and the "bigger" battery costs nothing to Tesla, the $37k version has a higher margin if the enhanced interior features cost less than ~$2k.
  - natch 8y ago
    Possible... that does make sense. It would definitely be smart to use the same parts if they can do it and give both cars good trade offs for the performance / wear. My hunch is though the other upgrades more than meet the $2k difference even when only considering Tesla’s own cost.
- crowdpleaser 8y ago
  It probably does have a larger margin, you'd be shocked at how little it costs automakers to add some features / content. IIRC, an Escalade's interior costs ~$1,000 more to manufacturer than a Suburban's interior. The rule of thumb in trucks is that interior upgrades usually carry a 75%-90% margin for the manufacturer - in some cases, the lower trims actually cost more to build because they're such low volume configurations that the complexity in the supply chain / manufacturing process costs more than the savings of cheaper goods.
floatrock 8y ago
Textbook marketing 101 decoy pricing: https://www.paulolyslager.com/decoy-effect-price-tables/ https://www.paulolyslager.com/decoy-effect-price-tables/
- Aspos 8y ago
  .

ivalm 8y ago

Yup, the availability of "nice feature for 2-4k more" really drags up the price. I started looking at $35k, ended up wanting the $47k.. but that's a $12k increase...

bowmessage 8y ago

Especially if the range limit continues to be imposed only by the car's software.

doctorhandshake 8y ago
From what I was told at the dealer, the software range limit was only on the Model S produced during a certain span of time and now all long-range Teslas have larger batteries than their stock counterparts.
- cma 8y ago
  There was an X too and a second different Model S with it.

pcurve 8y ago

I don't think anyone will actually buy $35k model. They made it so undesirable that it's almost laughable. Reminds me of 2004 Honda Accord DX model with $16995 with roll-up manual windows, plastic hub caps and manual tranny that hardly anyone bought. Most will opt for $40k premium model. Though 37k is much better value, it's missing the core features that tickle fancy of Tesla buyers. Standard Interior Includes: Manual seat and steering adjustment Cloth seats and base trim Basic audio Standard maps and navigation Center console with storage and 4 USB ports Partial Premium Interior Includes: 12-way power adjustable heated front seats Premium seat material and trim Upgraded audio – immersive sound Standard maps & navigation LED fog lamps Center console with storage, 4 USB ports and docking for 2 smartphones Premium Interior Also Adds: rear heated seats Premium audio – 14 speakers, 1 subwoofer, 2 amps, and immersive sound Satellite-view maps with live traffic visualization and navigation In-car internet streaming music & media Internet browser Location-aware automatic garage door opener

elipsey 8y ago
I drove a couple of Hondas like that, and I kind of liked them. Ever try replacing a window motor? :)
- pcurve 8y ago
  Old Civic DX, CX, back in the days when they put double wishbone suspension on them.
- macintux 8y ago
  > roll-up manual windows, plastic hub caps and manual tranny Two of those I don't care about, and the manual transmission is a big win for me, so yeah, I'm with you.
gizmo385 8y ago
> it's missing the core features that tickle fancy of Tesla buyers Can you clarify what you mean here? I would think that the "core features that tickle fancy" would be things like autopilot, but that's an expensive add-on package regardless.
dsfyu404ed 8y ago
Manual everything tends to be popular with the "I don't want a bunch of shit breaking when this vehicle is old" crowd. If I had ~40k burning a hole in my pocket I'd get the base spec with the big battery and all the self driving bells and whistles. I can see the most basic model with the biggest battery being popular with the kind of people who buy an accord and put 200k on it over 8yr.
davidgould 8y ago
I drove a 1994 Honda Accord DX stick for 20 years. It had 247000 miles on the meter when the dash stopped working three years before I replaced it with a Chevy Spark EV. Great car, it was still on the original clutch although it was using a bit of oil. Now I have a Model 3 Performance because it’s amazing, it’s what I was saving for driving the Accord all those years.
leesec 8y ago

natch 8y ago

At only $2,000 more I doubt it has a better margin. I think they just want more buyers to be happier with their purchase, while still providing the $35k option they promised for those who prefer to stick strictly to that price regardless of features.

elihu 8y ago
It wouldn't be surprising if the 240 mile range battery and the 220 mile range battery are actually the same part. (As I understand it, there is a trade-off between battery wear and what voltage you change and discharge to. So, the people with the "low capacity" battery may benefit by having a somewhat longer overall usable battery lifetime.) If that's the case and the "bigger" battery costs nothing to Tesla, the $37k version has a higher margin if the enhanced interior features cost less than ~$2k.
- natch 8y ago
  Possible... that does make sense. It would definitely be smart to use the same parts if they can do it and give both cars good trade offs for the performance / wear. My hunch is though the other upgrades more than meet the $2k difference even when only considering Tesla’s own cost.
crowdpleaser 8y ago
It probably does have a larger margin, you'd be shocked at how little it costs automakers to add some features / content. IIRC, an Escalade's interior costs ~$1,000 more to manufacturer than a Suburban's interior. The rule of thumb in trucks is that interior upgrades usually carry a 75%-90% margin for the manufacturer - in some cases, the lower trims actually cost more to build because they're such low volume configurations that the complexity in the supply chain / manufacturing process costs more than the savings of cheaper goods.

floatrock 8y ago

Textbook marketing 101 decoy pricing: https://www.paulolyslager.com/decoy-effect-price-tables/ https://www.paulolyslager.com/decoy-effect-price-tables/

Aspos 8y ago
.