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I'm surprised by how micro-managey Tesla is with their Model 3/Y prices. Most manufacturers release a static MSRP for that model year. However, Tesla the past y

I'm surprised by how micro-managey Tesla is with their Model 3/Y prices. Most manufacturers release a static MSRP for that model year. However, Tesla the past year was dropping prices $500-$1,000 periodically. And then as of last month, has raised prices $500-$1,000 twice.

Geee 6y ago
They're balancing their production capacity with price. I.e. price that keeps delivery window not too long or short. They could sell them cheaper, but then they would be limited by manufacturing capacity.
ardit33 6y ago
Maybe they are doing A/B testing of the price?
- judge2020 6y ago
  In reality this is likely because they suspect the US EV tax credit extension to pass and they're slowly increasing the price to indirectly grab some of that as profit.
mlindner 6y ago
Is that in the US or Europe. In Europe they bounce it around a bit because of shipping costs from US and China fluctuating.
- reducesuffering 6y ago
  US
m463 6y ago
Now that you mention it - they're almost replicating the dealer experience. In the beginning Tesla's selling point was that they were not a dealer, you go to the showroom and there is no pressure because everyone pays the same price. Except with their pricing monkey business, you're replicating the same high-pressure "buy now before the price goes up"... for everyone. Aren't they over the hump? Can they get away from gym-membership stuff? Combine that with the variability of other nonsense - when will I get my car/truck? surprise! square steering wheel! etc... A true premium experience should treat people better, and ONLY inflict positive drama.
- nick_kline 6y ago
  Every 2 or 3 months it changes for everyone when they +/- it by $500. It's not a negotiation. It is surprising to me they do this, I cannot understand the tweaking.
  - m463 6y ago
    I was looking at a used car, and it changed price several times a week. You might also look at the experiences of used tesla buyers. The price isn't the only thing they've played with, they've been doing the same sorts of things with features and even warranty coverage, all of which have in general gotten worse.
toast0 6y ago
Other manufacturers are manage prices with consumer and dealer incentives. If you pay attention to car promotions, there's almost always a lot of differences in consumer cash back by model. Some manufacturers almost always have a baseline cash back, but if they want to raise prices, they can reduce that; if there's a model they want to move, it gets more, etc. Premium brands like to push leases and run promotions there. For the manufacturers with a captive finance company, there's even more room to play with pricing there. I don't think Tesla runs promotions like that, so if they want to change the price, they have to change the price.
ajross 6y ago
Other manufacturers don't deal with customers directly. There is at least as much, if not more, micromanagement of pricing and allocation in the traditional dealer world, it's just hidden from the public. And it's not unique to the auto world either, every vendor of items sold via large single contracts has an ability to pinch pennies that isn't available to small ticket retail items.
xkjkls 6y ago
It seems like a bad business practice, because it screws the resale value of any current owners. People want MSRPs to remain relatively consistent to their purchase, and greater uncertainty also generally makes lease rates higher because they need higher prices in order to justify the additional risk they take on.

Geee 6y ago

They're balancing their production capacity with price. I.e. price that keeps delivery window not too long or short. They could sell them cheaper, but then they would be limited by manufacturing capacity.

ardit33 6y ago

Maybe they are doing A/B testing of the price?

judge2020 6y ago
In reality this is likely because they suspect the US EV tax credit extension to pass and they're slowly increasing the price to indirectly grab some of that as profit.

mlindner 6y ago

Is that in the US or Europe. In Europe they bounce it around a bit because of shipping costs from US and China fluctuating.

reducesuffering 6y ago
US

m463 6y ago

Now that you mention it - they're almost replicating the dealer experience. In the beginning Tesla's selling point was that they were not a dealer, you go to the showroom and there is no pressure because everyone pays the same price. Except with their pricing monkey business, you're replicating the same high-pressure "buy now before the price goes up"... for everyone. Aren't they over the hump? Can they get away from gym-membership stuff? Combine that with the variability of other nonsense - when will I get my car/truck? surprise! square steering wheel! etc... A true premium experience should treat people better, and ONLY inflict positive drama.

nick_kline 6y ago
Every 2 or 3 months it changes for everyone when they +/- it by $500. It's not a negotiation. It is surprising to me they do this, I cannot understand the tweaking.
- m463 6y ago
  I was looking at a used car, and it changed price several times a week. You might also look at the experiences of used tesla buyers. The price isn't the only thing they've played with, they've been doing the same sorts of things with features and even warranty coverage, all of which have in general gotten worse.

toast0 6y ago

Other manufacturers are manage prices with consumer and dealer incentives. If you pay attention to car promotions, there's almost always a lot of differences in consumer cash back by model. Some manufacturers almost always have a baseline cash back, but if they want to raise prices, they can reduce that; if there's a model they want to move, it gets more, etc. Premium brands like to push leases and run promotions there. For the manufacturers with a captive finance company, there's even more room to play with pricing there. I don't think Tesla runs promotions like that, so if they want to change the price, they have to change the price.

ajross 6y ago

Other manufacturers don't deal with customers directly. There is at least as much, if not more, micromanagement of pricing and allocation in the traditional dealer world, it's just hidden from the public. And it's not unique to the auto world either, every vendor of items sold via large single contracts has an ability to pinch pennies that isn't available to small ticket retail items.

xkjkls 6y ago

It seems like a bad business practice, because it screws the resale value of any current owners. People want MSRPs to remain relatively consistent to their purchase, and greater uncertainty also generally makes lease rates higher because they need higher prices in order to justify the additional risk they take on.