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Tesla is still selling every vehicle they can produce. They are still supply constrained. They sold more EVs last quarter than their competitors combined all
by jml78 4y ago
Tesla is still selling every vehicle they can produce. They are still supply constrained.
They sold more EVs last quarter than their competitors combined all last year.
- CamperBob2 4y agoWhy are they cutting prices, then?
- LammyL 4y agoTesla is in an infinite loop of building efficiencies and lowering manufacturing costs. Elon has said many times that the lower the price of a car, the more market share opens up. Their margins are in the 20-25% range whereas a legacy auto maker is below 13%. There is a lot of room to cut prices and still make money.
- SketchySeaBeast 4y agoWell that's confusing, people seem to be claiming different things. One is that they sell cars as fast as y If they continue to 100% sell out, why reduce margins?
- CamperBob2 4y ago[flagged]
- SketchySeaBeast 4y agoHmmm, message got mangled. "Well that's confusing, people seem to be claiming different things. One is that they sell out immediately, the other is that they need to reduce margins to increase the market size. If they continue to 100% sell out, why reduce margins?
- LammyL 4y agoManufacturing capacity and output are also increasing as they build more Gigafactories and optimize existing ones. The price changes are an optimization to balance sales and production output to avoid shortages or inventory.
- jml78 4y agoBecause they want to undercut all their competition. Their profit margins are insane compared to every other car maker especially in the EV space. It puts more downward pressure on Ford, VW, Kia, etc to cut into their already razor thin margins. Tesla could sell the model 3 at 30K and still make a profit but they have zero reason to do that.
- llamaLord 4y agoBecause they have inanely high profit margins since their cars have something like 1/10th the number of moving parts, making them remarkably cheap to manufacture. Lower prices = more market share.
- nytesky 4y agoBut wouldn’t other manufacturers EVs ALSO have fewer moving parts? Why are there margins so thin?
- trog 4y agoI think this is still true but worth noting more recent data shows inventory climbing[1]. I don't think it's drastic yet - just a reflection of the economy contracting. Price drops are keeping them moving but at the cost of their traditionally excellent profit margin. 1. https://twitter.com/TSLAFanMtl/status/1642700991341494272 https://twitter.com/TSLAFanMtl/status/1642700991341494272 (random Twitter source, no other verification done but I have seen this mentioned in a few places. Could be short propaganda I guess!)