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No car manufacturer does. It's much like going to a fast food place and ordering just a hamburger. The profit on the burger is very low, but the profit on fre
by sliken 7y ago
No car manufacturer does. It's much like going to a fast food place and ordering just a hamburger. The profit on the burger is very low, but the profit on french fries and soda is sky high. So the fast food places push the meal bundles.
Because of the profit on options is sky high (often a few $$$ of materials can cost $1000s), it's getting increasingly common that a cars options can substantially increase the cost of a car.
Luxury cars have been feeding this cycle and it's actually refreshing that Tesla has so few options. BMW drove me crazy with an incredible and quite complicated system with numerous incompatibilities designed to upsell you. Things like the tires/wheels being linked to the steering wheel upgrade, which is linked to the performance seats, etc. What was maddening that features on lower end cars (like power lift gate, bluetooth, and decent headlights) are many $1,000s in a luxury vehicle. NHTSA recently blasted various luxury car makers for lousy headlights unless you upgraded to the $$$ version. Amusingly the top stock headlight they tested was from a Toyota Prius! Quite a few luxury cars were rated poor for headlights.
Similarly to other car markers, the Tesla model 3 base model has very low profit. But if you buy the higher models a large part of the price difference is profit. So the $35k Tesla only made sense if most buyers actually got the $40k model (or higher). So many picked the $40k model, that tesla decided to not make the $35k model and just software restricted the $35k model.