> however, if every other US car company is not doing 25k cars there is no support to an argument that an alternative CEO for Tesla would do 25k cars. Sure the

> however, if every other US car company is not doing 25k cars there is no support to an argument that an alternative CEO for Tesla would do 25k cars. Sure there is: people ain't gonna pay an extra $15k for gits and shiggles. Unless those $40k cars are substantially better than the $25k cars, people are going to try to buy the $25k cars first. > If each car comes with say 15k of overhead then even if you can double your units sold by dropping the price from 40k to 25k you are behind 20% in total profit. So aim to sell double and a half, and then you've hit the same profitability as those $40k cars. Every extra sale past that would represent increased profit from the lower price-point. And this assumes that the extra sales volume (and therefore the production volume to satisfy it) wouldn't translate to reductions in that overhead due to economies of scale. If that doubled volume translates to a 16.67...% reduction in overhead, that'd also be enough to hit the same profitability as those $40k cars. Every extra sale or extra reduction in overhead past that would represent increased profit from the lower price-point.