Jan 15, 2009
tomsax Yesterday, my wife and I got word that Tesla Motors was contacting owners whose cars were about to go into production because they are introducing new options and unlocking all remaining 2008 model year orders. We knew that VIN 214 had started production and we're 217, so that's us.
As it turns out, Tesla is adding one new option (performance tires) and raising prices on many of the existing options. For example, the HPC is no longer bundled and is now a $3,000 option (just like the 2009 orders), the destination charge increased from $950 to $1,950, and the SolarPlus windshield which was previously standard is now a $400 option. Also, the audio upgrades are no longer available separately, instead there's one big $3,000 option for everything, a $500 increase over the total cost of ordering them all separately.
These price increases apply to all 2008 model year orders with VIN number 210 and higher, and apply to everyone even though we locked in our options as early as last September.
More details and commentary are on my blog.
Tesla Price Increase - Tom Saxton's Blog
I expect an official letter from Tesla announcing this change in options and pricing tomorrow (Friday, January 16th).�
Jan 15, 2009
SteveF Simply put, this sucks.
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Jan 15, 2009
graham This does not make me very happy at all.
ETA: Typed and erased several rants. Summed up: This is very rude. And very possibly a deal breaker for me.�
Jan 15, 2009
TEG Now I guess we know why they just blogged about all the incentives.
I guess they want a cut of that $7,500...
Condolences to those of you who didn't get in before the cutoff date.
(But those who already took delivery might be lamenting the fact they they didn't have a chance at the Sport package).
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Jan 15, 2009
doug I can imagine that a lot of the affected customers must be pretty unhappy. I can only hope that Tesla Motors considered the balance between revenue and customer good will.�
Jan 15, 2009
stopcrazypp I was thinking about what to say but it's along the same lines. I could see a lot of unhappy customers.�
Jan 16, 2009
malcolm Ouch.
Home recharging takes the biggest price increase. The fast charger is now a $3000 option and the (US only?) mobile charger has been cut to 120V only.
How's that for symbolism?
ETA: fair enough that they have to increase their prices, but not to locked-in customers!�
Jan 16, 2009
Lancelac Tesla always made pretty clear the options and pricing of such was not set until you lock in your car, BUT calling people well after they've locked in, a few days before their car goes into production is a bit much.
I was certainly not expecting the option prices listed on the 2009 spec sheet on Tesla's website to be the same as I'm going to pay (I'm #590), since I knew there would be an updated list of options and prices before I lock in a few months.
Will the extra 5k they get from each remaining 08' make up for the 10 canceled orders, and overall bad will this creates? I doubt it. They knew 2 months ago (when the bailout was passed) that most 2008s would be produced in 2009 and get better tax incentives, and yet they waited until now to spring it on people that they have to pay more...�
Jan 16, 2009
WarpedOne I kinda agree.
But after all those new incentives from government you can still be 1000 USD "in profit" though.�
Jan 16, 2009
graham This is not the case in my situation. Plus since this adds several thousand dollars pre-sales tax, it adds even more once that is added in. Not to mention that it is still unclear if the $7500 tax break is exempt from AMT. If it is not, none of the Tesla buyers are eligible for it anyway.
Part of "the deal" for allowing Tesla to hold tens of thousand of dollars for 2 years waiting for their product was getting to lock in your price early. Early people got a lower price in exchange for helping finance the company to get off the ground. Coming up with a way to essentially raise the price at the last minute is reneging on that deal.�
Jan 16, 2009
doug Yeah, I have to assume someone made that calculation. How many customers does this affect? 300 or so? Many of whom have had deposits down for a long time. It doesn't seem worth it (to me, an outside observer), but Tesla must have deemed this necessary for their midterm goals.�
Jan 16, 2009
WarpedOne 300 x 5.000 USD = 1.500.000 USD
How many will cancel their order because of this? Doesn't matter, new orders will come in. Trouble is they are braking their word. You can only loose the credibility once and this might have negative impact on the long run. How many will put down the deposit for Model S if after a year the price might go up?
They would be far better off if they would just offer new options at higher price like new interior for 5000 USD or carbon fiber inserts for 8000 USD. Some might choose to go for them and reduce the financial leakings. Ofcourse, if they aren't too high already. Isn't Elon supposed to have deep pockets? Not deep enough?�
Jan 16, 2009
SByer The only thing I'm really ticked off about is that the information from Tesla has been really slim and scant this week. I also feel for Tom and Cathy - they are definitely being yanked around.
I was always surprised the radio options weren't bundled (though it's not like I'd ever pay for a sat subscription). I'm also wondering if there's a head unit change as part of this, and maybe the cost changes reflect this. Who knows? We're not getting enough info.
If this offers me the opportunity to choose a carbon fiber top instead of the painted one, or the black sport wheels instead... that would be nice. I'm clearly far enough down on the list (482 last I heard) that they haven't gotten to me yet. It's been a mushroom week.�
Jan 16, 2009
Lancelac I didn't even know that anyone had a choice to have the stereo unbundled. I've been annoyed by that since I checked out the 09' spec sheet 6+ months ago. I don't want a NAV unit, a) it's of limited use for a car that can't really go on road trips. I've lived in Chicago for 20 years, I know my way around, b) I can just use my I-phone for GPS in a pinch. I also don't want SAT radio. The reception on the free internet radio I get thru my I-phone (at least in my neck of the woods) is already more reliable than SAT, I've tested them side by side in a friend's car.
All I really want is better speakers and a better head unit, and from what I hear about the "upgraded" unit, it stinks. I could replace all the speakers and unit with better quality stuff for less than I end up paying for the "bundle". I'm probably not going to get the stereo upgrade and spend the money (or half of it) doing the upgrades I want.�
Jan 16, 2009
vfx Isn't there a contract breaking here?
This type of petty action does not sound like a company that (as Elon says) will be making profit soon.
A company that has been in controversy for so long can hardly want to piss off buyers so royally.
TTAC should have a field day with this one.�
Jan 16, 2009
JRP3 Yes, I hope the bad press that this generates is worth the extra revenue for them, or vise versa. Terrible idea.�
Jan 16, 2009
TEG Although news of the $7500 has been out for a while now, so some may have already started to "count their chickens" and figured it was all coming to them.�
Jan 16, 2009
donauker It would appear that this topic of discussion and the comments by various owners has been deemed to not be appropriate for discussion on the Tesla Motors owners forum and have therefore removed by the censors.
It seems they prefer that owners state their opinions in a more open environment.�
Jan 16, 2009
Palpatine The new wheels look horrible to me.
https://www.teslamotors.com/display_data.php?data_name=roadster_wheels
They must be doing that so everyone selects the option for the $2,300 Forged Alloy Tesla Wheels (silver or black finish).�
Jan 16, 2009
doug Jason Calacanis posted an email from Elon to owners about the new options available:
Tesla Customer update�. The Jason Calacanis Weblog
There are lots of new options related to the Roadster Sport. Some already available options are more expensive (~2x). Some things that were previously included as standard are now listed as options. (For example the special Tesla slanted spoke wheels are now a $2300 option.)
There doesn't appear to be any mention of how this affects current 2008MY customers. But looking over things, if you expected a 240V mobile charger (used to be $350~$500, now $1500) and all the other things that used to come standard, you'll be paying at least $7700 more. If you had previously locked in some options like premium color paint and the $800 "seven-speaker premium sound system tuned for Tesla Roadster cockpit" with the standard radio, you'll now pay an additional $3200 over what you would have paid before and have a radio you don't want. So that's a total of $10,900 more for effectively the same options over your previous "contract". And that's before taxes. I see nothing wrong with Tesla raising their prices. But it doesn't seem like a good thing to do to your early customers that have already locked in their options. I hope we can get some clarification on this.�
Jan 17, 2009
TEG I think I see an opinion written there right between the lines.�
Jan 17, 2009
TEG <== NEW / OLD ==>
To each his own I suppose. I kind of like them.�
Jan 17, 2009
WarpedOne Is all this a making of new product arhitect?
Kinda worries me ...�
Jan 17, 2009
dpeilow $1500 for a simple power lead�
Jan 17, 2009
JRP3 I wonder if this breach of contract might bring on some litigation? I'd also be worried about "locking in" the battery replacement price of $12K by paying in advance. What's to prevent them from jacking up that price in the future? I'm really disappointed by this decision, either they are desperate for cash which doesn't bode well or they've taken the attitude that people will pay anything they demand to have a roadster.�
Jan 17, 2009
Palpatine I saw the black version of the wheels on a Roadster in the service bay of Menlo Park. I believe that is what they are doing with the picture for the Sport. That is clearly superior (to me) in terms of looks.�
Jan 17, 2009
bill Let's Speculate
Tesla is playing this close to the vest so we will just have to guess at what might be happening behind the scenes. They seem to be in a cost pinch.
First, the forum reported months ago that Elon stated that the roadster costs were underestimated.
Second, along with the spike in oil prices came an overall increase in material prices.
Third, Tesla doesn't have the volume to negotiate steep price discounts.
Fourth, The roadster is still hand built and I doubt that they have realized much of a cost reduction from increased production. They have certainly reduced overhead expenses a bit, but not overall man hours to assemble a roadster.
Fifth, if anything, the total cost of material and labor has probably increased over the last few months.
Sixth, I'm not sure of the impact of the dollar vs euro valuation has on all this. Some one will have to fill that in for us.
I'm guessing that the Sport option was simply a way to increase the roadster price without a significant increase in cost to Tesla.
They are apparently in rough shape with costing right now. I would hope they soon give us a better explanation of why this move is critical.
�
Jan 17, 2009
dpeilow Does anyone know whether Tesla or Lotus are responsible for buying the carbon fibre panels from their French manufacturer? Certainly the pound vs. euro has taken a bit of a battering recently.�
Jan 17, 2009
Lancelac Regarding Tesla's exposure to the Euro/$ exchange rate: If you aren't hedged in today's world, you're an idiot and deserve what you get. I speak from experience working at investment banks and being told to shut up when asking why the mortgage book is only 0 to 25% credit hedged and 0 to 80% directionally hedged. Look to the difference between profits of any major airline and Southwest for one of a million more examples.
As for the battery idea, it seems useful for anyone that plans on driving the car quite a bit, although it seems like a big gamble since you don't know what the replacement will actually be when needed. Will you get the $25,000 top end replacement (MUCH better than today's battery), or the one equivalent to the one you are replacing (probably around $5,000 in 5-7 years). Seems impossible for them to guarantee anything since Tesla doesn't know what will be available down the road or its cost. Lucky for me this option is pointless as I only anticipate putting 4-5k miles per year on mine. If I like the car that much, I'll be replacing it with a new one long before the battery pack gets to even half the expected life in miles.�
Jan 17, 2009
dpeilow The speed at which the pound/euro and pound/dollar plunged took a lot of people by surprise. It's possible that if Lotus were buying the glider panels from France, they have seen an effective price increase that is now being passed on. How far ahead do you hedge? Just speculation.�
Jan 17, 2009
SByer Ok, so I'm going to be the weird one in the group and say that, now that I have the e-mail from Elon, I'm actually kinda happy. Yes, I'm going to be paying more for options - I'm not fond of the stereo bundle, but like I said, I was always surprised it wasn't that way. The unbundling of the HPC is a bit of a bait-and-switch, as well.
I'm happy I can now get the carbon fiber top, have options for de-plasticing the interior (though I'd like to see them in person before choosing), and options for the wheels.
I just wish the upgraded motor from the Sport was an option (or getting a Sport upgrade on an '08 was an option), and of course, some information on some of the options (upgraded seats?) would be useful.
Maybe I'm being a bit blase about this, but I kinda sorta expected some fiddling of options to extract more cash out. It's the lateness of it, and the lack of complete information that's put me off.�
Jan 17, 2009
JRP3 I thought you could upgrade?
Tesla Motors - Roadster Sport�
Jan 17, 2009
Lancelac 09's can upgrade by just paying for the Sport package, with no delivery change.
08's can upgrade by pushing their delivery to July/August, AND paying the 09' base price (110k) instead of the 08' base price (92 or 99k depending on the commitment date) PLUS the Sport package. The wait and 30-38k price diff is pretty much disuading almost every 08' order from upgrading.�
Jan 17, 2009
tomsax Updated Price Increase Analysis
Here's a link to my analysis of the price increase due to the change in the base model and prices of the options.
The New Tesla Prices - Tom Saxton's Blog�
Jan 17, 2009
Palpatine I think the real goal of offering the Sport mode to 2008 was to sell those final few 2008 spots to new customers. Now they can slip about 30 orders into the 2008 that get delivered in July.�
Jan 17, 2009
TDA I kind of sort of expected some fiddling of options to extract more cash out of me as well, up until the point they made me push the "lock-in options" button nine months early to keep from "delaying" my car anymore. That "lock-in now" thing is beginning to sound like a familiar ploy essentially to extract more cash out of each Tesla buyer. What happens when we get to VINs 400, 600, 800, etc? The $12,000 battery they want us to ante up for now...is it really only going to be $12K when we actually need it? Doesn't really sound like a "new kind of car company", it sounds more and more like every other car company.
We've played completely by Tesla's rules and I fully planned to honor my commitments as I've done all my life. I guess I naively expected them to do so as well.
Out of the 400 remaining 2008 buyers one would expect a couple of them to be lawyers. It wouldn't bother me a bit if one of them wanted to put together some sort of a class action lawsuit to force Tesla to honor their commitments. Of course there are many problems with that approach, the biggest is that Tesla is holding a good chunk of my cash.
Oh well, maybe getting out now isn't really such a bad deal. I've kind of been wandering how Tesla will survive once Toyota, Nissan, GM, and some of the others actually get into the game.�
Jan 17, 2009
stopcrazypp Prospective Tesla owners not happy about price increases on locked in cars - AutoblogGreen
Looks like we're in the news. Hopefully the bad publicity is enough to get them to turn around (it'll spread quite quickly after it's out there). I don't want the company to become bankrupt from one stupid move.�
Jan 18, 2009
dpeilow Woah, check the comments at ABG already...
But as I have said, the change of pound/dollar exchange rates that people are assuming means Tesla are getting a good deal from Lotus on gliders (assuming they are charged in pounds) is even worse *the other way* on pound/euro for parts Lotus may be buying from mainland Europe, such as the body panels. Perhaps they (Lotus) have no choice but to pass this on to Tesla?�
Jan 18, 2009
Palpatine It looks like at least one owner (#395) is cancelling his order because of the price increases.
1-18-2009 @ 12:09AM
Ron Elliott said...
I am number 395. I am not a rich person dabbling in a plaything. I thought I was actually doing some good by supporting a company that was moving us to a more sustainable future. I put $50,000 of my own money down on this car in May of 2007. I withstood the delays. I held in there when it almost seemed the company was going bankrupt. Now, after locking in my options, they pull this on me. Elon Musk does not understand the power of evangelicals to the cause. Steve Jobs does. The same power that can bring people to the cause can turn the same power in a 180 degree turn against the cause. From this day forward, that's what I'm going to do. Elon should know that the people who have bought this car are not stupid. We know that the rolling stock has seen a price depreciation in the English pound from $2.04 to $1.44. He's making more money than he ever thought he would. This is a blatant slap-in-the-face-and-see-if-it-sticks move. I hope that enough people cancel their order so that the whole company goes bankrupt. Movements based on ideology hold companies to a higher plane than companies that do things just to make a profit.
I'd love to have the car, I can't have it now. I don't like the feeling of being screwed.
Ron Elliott�
Jan 18, 2009
felix pius Tesla MUST be cash positive within a few months?
After so much negative comments:frown:, I want you to be honest: Tesla could be forced to increase the roadster prices soon in order to get cash flow positive. They can only arrive to that, if the costs of the roadster are now 100% covered by the selling prices. Most probably, this is a very important factor or even a condition to get the 200 million loan guarantee for the model S. Like that, no one can anymore say, that Tesla want a bailout for a luxury gadget - seems very important to me.
Of course even in such a case, we would like to have a more open communication of this step. On the other hand, Tesla's strategies and financial situation can not be fully exposed to the public obviously.
I hope we will hear more about Teslas Model S :wink: in the next few weeks to calm down our anxieties.�
Jan 18, 2009
Palpatine I think the price increase is about Tesla becoming cash flow positive. They need to make a little more per unit off of the 2008 models that are being delivered right now. They have about 390 units that are being affected by this.
They are on the verge of producing 20 per week and they need to capture this revenue and generate some profit.
Tesla Motors likely is close to breakeven right now, but not quite there.
It looks bad to do this to owners that have locked in their options. But Tesla might really need that extra $7,000 per vehicle.
Selling a few hundred cars where they lose money on every unit is a lousy formula for a long term future. Just look at GM, Ford and Chrysler.
That having been said, I am not happy about giving more money to Tesla. But also I have not locked in my options yet and I have nothing to gripe about.
The owners could just take ownership of a base model Roadster and a mobile recharging unit (110 V 15 A) that will recharge at 6 or 7 miles per hour. That would still be the original price.
We can always ask for a refund if we are really that upset.
I won't be asking for a refund. I WANT MY TESLA ROADSTER !!! It is still the most awsome car on the planet.�
Jan 18, 2009
DDB So what happens when Tesla introduces Model S and takes deposits? There are plenty here at this forum that may think twice simply because it could end up costing 20-30% more. That could really hurt Tesla�
Jan 18, 2009
vfx You don't know this. Or more accurately, you don't know if they are not already covered.
It's about being true to your word.
Tesla has raised their prices. Three and a half times. (92K, 98K, and 109K now 125K)
Raising prices is not uncommon. But there are hundreds of people who have already made a deal or "locked in". Reneging on the deal creates a lot of bad blood.
What if you waited an hour to get in a popular diner, sat down and ordered a burger and fries. Then while you can smell it cooking the waiter informs you that you have to pay extra for salt and catchup, and the bun will now be white bread unless you pay more and it will be served on a piece of notepaper unless you buy the plate upgrade.
Would you eat there again?�
Jan 18, 2009
Palpatine That is a very good point. But the base price of the Roadster is still being honored. Those people that paid $92,000 or $98,000 or $109,000 are still only being charged that amount.
This is only the options that have been jacked up. Tesla likely regrets not charging more to those early customers, but that is still the price of the car for those early numbers. Any owner at $92,000 or $98,000 could purchase a base model for that price. The premium leather upgrade price has not changed at $1,800. That is the major upgrade item. I think many people could find most of the other upgrades aftermarket (electronics group, wheels, etc).
If you really wanted to, you could even ship the vehicle yourself at about $800 and avoid the $1,900 delivery fee.
I would be more concerned about putting down big money for a Model S. I wouldn't pay a $30,000 deposit, but I might do a $5,000 deposit. It really depends on if it is truly an incredible sedan.
I would be more worried about the long term health of Tesla Motors surviving till the Sedan is produced. I don't know if they are selling any more Roadsters in this market. They might complete their backlog in late 2009 and not have anything to do. That is one reason I am not doing the extended warranty ($5,000) or the replacement battery ($12,000). I am not sure Tesla Motors will be around 4 or 5 years from now. I hope they are still operating, but we cannot be sure in this market.�
Jan 18, 2009
vfx What about the wheels?�
Jan 18, 2009
graham I have been avoiding saying much more publicly on this until I get more official confirmation from Tesla. I will say this: The original option prices are actually listed in line-by-line detail in my original paperwork with Tesla. They always made a big deal that the HPC "comes as part of the price of the car..."
I would not be unhappy with them at all about this if I had not been an early adopter. If I had purchased a 2009 with my options already unbundled I would have gone into knowing full well what I was paying for. This is about agreeing to a price, making a big deal about getting in early to lock in a price (including options) before it goes up, and then at the last minute breaking that promise.
I want Tesla to succeed. I want them to get cash flow positive. But do it by offering services I want to buy at a price I can afford. Or at least politely asking would I mind paying more for a service I have already paid for to help a brother out. I am good with that. Keeping my money for 2 years and then saying "pay 12 grand more, or you get no car " at the last minute is just not cool.�
Jan 18, 2009
vfx That too.
.�
Jan 18, 2009
j-g It was my understanding from the beginning that the battery pack in today's dollars was ~$20,000, not the $30,000 quoted in Elon's letter. Am I remembering this inaccurately? Also, with normal use, it was to have lost ~20% of its charge in 5 years. Does that mean it will be useless in 7 years?
I also expected that the replacement battery pack that would ultimately be purchased in the future would be significantly different than the current one due to technological advancements. This would translate into greater energy storage or lower cost or both. Given these expectations, it sounds very unreasonable to plunk down $12,000 right now.
It is like buying roof replacement insurance for my house.
Jeff�
Jan 18, 2009
Palpatine I am willing to wager that you could buy those same Tesla wheels (or better) for about $1,500. Then you could sell the basic wheels that come with the car.
You are correct that this is lousy switch made by Tesla Motors. The basic wheels are clearly less attractive.�
Jan 18, 2009
Palpatine If the early owners have that level of paperwork signed and in a contract, then I think that the HPC issue is going to be very difficult for Tesla Motors to deal with. They might have to keep that included in the package. I know there are lawyers who are in that group.
I was not following the Tesla universe back then so I don't know what was promised. I made my deposit in September 2008 and I am at the $109,000 level. It was made clear to us that the HPC is $3,000 extra. So I don't have the same anger.
But I fully understand the anger of owners that took a VERY early risk by making large deposits to Tesla, interest free loans, with nothing being safe in an escrow account. If Tesla Motors had failed, then the money would have been lost in bankruptcy.�
Jan 18, 2009
Bradleybang I put down my deposit in March 2008 and was told that HPC was included.�
Jan 18, 2009
Palpatine If the early owners have that in writing, then I don't see how Tesla Motors will be able to make that stick. They will have to include the HPC for those early buyers.
That may be the compromise that Tesla Motors offers to repair this PR mess.�
Jan 18, 2009
doug I suppose some might attempt to make that claim, but changing what's included as standard is effectively the same as changing the base price.
I hope that Tesla can get this taken care of to the affected customers' satisfaction before it becomes a PR nightmare. At this point this issue is still within the relatively small (and forgiving) space of this forum and ABG. But by Tuesday it could be in the New York Times, and it will be much harder to undo the damage.
What's worse is that some of those affected are the biggest cheerleaders for the company. Tom Saxton is often the first person to post a correction or clarification when a negative article shows up about the Roadster or Tesla Motors. It really is unfortunate.
Again, I hope Tesla Motors can get this straightened out because I really want them to be able to succeed.
(Sadly this may have a new double meaning for some customers.)�
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Jan 18, 2009
WarpedOne I'd say this is a worry for Mr. Musk not for us.
His credibility was just downgraded for yet another notch.�
Jan 18, 2009
TEG SiliconBeat: The Tesla Roader taken for a spin; and its "gut-wrenching" VC roadshow
(That was from a 2006 story, so if you extrapolate, the pack theoretically should only be about $16K now... Assuming they were using accurate numbers and prices followed the expected trend.)�
Jan 18, 2009
doug Come on now, clearly the $30K battery replacement price includes a healthy margin. That's the price to the customer, not to Tesla. It also serves to make the $12K buy-in-now deal appear more attractive. The letter includes what I consider a pretty heavy sales pitch for the $12K deal. Btw, the talk about a 7 year battery life span could be hinting to what restrictions may apply.�
Jan 18, 2009
TEG People have been mentioning that the wheels got switched around, so the previously standard wheels are now a costly option.
And the HPC turning into a $3K option.
Then there is the SolarPlus Windshield (previously included, now $400).
11 of 13 paint color choices are expected to cost more too. (Although the buy link on their web site still shows the old prices).
So, if you want to keep the base price intact you would need to:
- Pick Fusion Red or Racing Green color.
- Be willing to accept that you get different wheels now.
- Be willing to accept that you don't get the SolarPlus Windshield anymore.
- Be willing to accept that you don't get the HPC anymore.
- Be willing to accept that you don't get the Homelink door opener anymore.
On the other hand you now get a 120V/15A mobile cable for free.
Oh, and if any of those changes from the Sport model become standard that would be a bonus too. For instance, a new kW meter instead of "vestigial tach", and moving the VDS from the left side to the center are major improvement, IMHO.�
Jan 18, 2009
relliott My email to Elon Musk
If you had actually explained to locked-in owners the reason why you needed to raise prices was to be profitable so that you could get funding from the government for the Model S, I�m very sure that everyone would have understood and supported you.
Instead, you sent out a deceptive email about new options that made locked-in owners confused about it being a price increase or not. You�ve created a lot of anger. Personally, my anger at first was about the price increase. But now, it has morphed into the way you have done this. Mr. Musk, you are showing a lack of integrity in the way you have done this price increase. Unfortunately, you are the CEO of Tesla and have now shown to your employees that it�s o.k. not to have integrity, as long as the end justifies means.
You are also showing a lack of respect for your customers. We are not stupid. We would understand why you had to do this if you had actually given us enough credit for having the intelligence to do so. You need to send a second email that apologizes for the email you sent. Own up to the fact that locked-in owners will get a price increase and give the reason for the price increase. People have not given $50,000 as a deposit for 2 years because they need an electric sports car. They have done it because they believe in the dream of advancing us all to an electric future for the automobile. The dream, and the people who have bought into it, are taking a blind leap of faith in Tesla Motors. Faith is the operative word. You are destroying the faith by not acting with integrity. We are your fanatics. We will bring the masses you need to make the Model S successful. Don�t disrespect us and underestimate our intelligence.
You need to put your very large ego aside for a moment and write that second email. If you don�t, you will have a P.R. disaster much larger than any you have had in the past.
Sincerely,
Ron Elliott�
Jan 18, 2009
doug Those are certainly great improvements but will only be available on 2009 models. The issue at hand is the 2008MY customers that already had their options locked in. So far it appears that if 2008MY customers want these features, they need to forfeit their '08 reservations (locked in at a base price of either $92K or $98K) and pay more to cover the higher 2009MY base price of $109K, even though Tesla is currently selling later VIN 2008MY cars at a base price of $125K.
Again it would be nice to have clarification on this.�
Jan 19, 2009
cue Stay or Cancel?
I have not gotten any notifications from Tesla but if I have to change my locked order with the new options, I am going to likely cancel. It is not the price difference as I was clearly already overpaying to help Tesla, but the way this has been handled. There is nothing worse than feeling like a sucker and unappreciated customer. I would have happily spent more money for some options or even paid more if Tesla handled this properly. Instead, I feel like they must think I am stupid and willing to do anything to get the car.�
Jan 19, 2009
TEG Sorry to hear that, 'cue'.�
Jan 19, 2009
WarpedOne Cue, you should send a mail to Elon. He's the one responsible for this charade.
Where is Martin when one needs him?�
Jan 19, 2009
NEWDL I am not saying this is right...but you should read the contract that you signed....everything can change...EVERYTHING!!!!�
Jan 19, 2009
dba I have read it a number of times. You are correct everything can change. UP until the time you LOCK IN!!! Then change is limited by the laws of your state.�
Jan 19, 2009
DDB As an attorney that deals with plenty of consumer disputes, I'd rather represent the buyer than Tesla, because the buyer's position is stronger. I have not read the contract, but there are plenty of Consumer Sales Practices Act violations (which most states have adopted) that could zing Tesla. Tesla had also better watch treble damages. Then touching on common law, it is just not equitable for Tesla to retain a client's funds, make promises, and then renege. Equity would also wack Tesla.
I hope that there is not future litigation, but part of me also wants to see a suit, because it would prevent Tesla (and other manufacturers) from doing this. Lawyers do act as watchdogs, regardless of our reputations.�
Jan 19, 2009
Kevin Harney Seeing all of these price increases ( 92, 98, 109, 125 and now this one of essentially another 10K) leads me to one sigular conclusion.
I will not be buying a Model S until I can walk into the dealer and buy one for cash and walk out with the car the same day. I am quite appreciative of all those who have spent their money to help the company succeed BUT for the average Joe like me that is simply not going to fly.
This also leads me to think that when Daryl said he left for differences of opinion that this might have been coming for a little longer than we thought. I personally have been a little hard on Daryl but I do respect him and I have not seen him do anything as down right dispicable as this. I wish communications from him had been more forth right and timely but I am sure his hands were tied as to what he could and could not say and when he could say it.
I think this move is going to VERY far reaching consequences and that Elon made a REALLY dumb move here. Much of my suppor tfor this Company has gone out the window completely. I may still buy their product (Model S) but it will no longer be for the principle of it. I will buy the car if it is the best car for the best price and no more. So all I have to say is that Model S better be the best damn car on the market or NO SALE.
This incident has been the turning point for me. And I am sure that many others will follow. SAD.�
Jan 19, 2009
graham This incident has the POTENTIAL for being a turning point for me too... but since this all came out at the end of a week much of the company was away - I am still waiting for more official word on this before I say much about it. This seems too poorly thought to be the final word.
I am hoping they come back and say "We spoke in error. We weren't thinking - our bad. We do really love you guys. It was Jim the Intern's mistake. He has been punished. Bad Jim."�
Jan 19, 2009
Cobos I'm in the same boat as you Kevin. I had always thought I'd buy a Model S even though that is stretching what I might consider spending on a car a lot outside my comfort zone. [As a side note how many percentages of the value of your house/condo would you spend on a car?] I've been convincing myself that this is going to be the right thing to do, for several reasons. First since the car should be a great one, second because I want to support the EV cause and thirdly because I like the Tesla company for their attitude towards EVs. Point 3 now is getting some serious blows, and of course I am VERY price sensitive, so in my case if something similar happens with Model S regardless of how they handle it, they might end up blowing my budget.
I'll let Tesla make a public statement about this before I pass judgement, but the Model S better be bloody marvelous if they want to maintain a firm supporter.
Cobos�
Jan 19, 2009
dba
Wow, that was one heck of a mistake! A mass emailing with Elon Musk's Signature line. And also it takes little to no reading between the lines of Tom Saxton's blog linked in the first post of this thread to determine that he felt forced to accept the new terms and prices if he wanted his car to enter production.�
Jan 19, 2009
Stewart W ***************
I am not litigious by nature. However, this is simply wrong and a slap in the face of the early supporters.
I believe a lawsuit is imminent once this hits the press...time will tell.�
Jan 19, 2009
Sgee Well, I may be simplifying this, but if you have a problem with the price raises you should call. If we got enough people to call it might make a difference. Atleast one person will have the guts to say they made a mistake, and if they saw it as a problem to future business they would definetely change there minds. At the very least they could make it so the people that locked in don't have to pay for the price raises.�
Jan 19, 2009
Palpatine That is approximately what I think will happen. They will get more flack for a few days, they might even get a legal complaint proposed. Elon will talk with his lawyer, his lawyer will tell him that they don't have a defense for the locked customers.
The weakest issue is the HPC. Tesla promised that in writing too many times. It was included in the deal for people at $92,000 and $98,000.
They can likely get away with changing the wheels. I don't think that was ever mentioned in writing.�
Jan 19, 2009
dba This excerpt is from a 2008 Model Spec Sheet I have in my files. It is under Standard Exterior Features
Along with this line
�
Jan 19, 2009
Palpatine dba, if that was put in writing and was part of the deal, then Tesla Motors doesn't have a leg to stand on. All it takes now is for an affected customer to push the issue.
Based on my VIN # and the timing of when I made my deposit, I don't qualify.�
Jan 19, 2009
graham The mass mailing from Elon merely states that they have new options available and the old options are at higher prices for new purchases. It never says that they plan to force those prices onto people already locked in.
It is not a mistake to offer new services, nor to raise the price of existing ones. The mistake is in forcing those changes on people who are already locked in, and making substitutions to give them a lesser product than what they thought they were buying. These people have been waiting for 2 years and have invested a lot to pull a bait and switch now.
I separately believe it is a mistake to not allow early owners the chance to upgrade to the Sport or other new options without making them first pay the price difference for the 2009 (and its subsequent unbundling as well). But this mistake is forgivable, the former is not.�
Jan 19, 2009
graham The Truth About Cars has picked up the Autoblog Green story:
$112,000 for the Power Cord; Tesla Roadster for Free | The Truth About Cars
There is a very small window for Tesla to fix this before it hits major news. Once that happens, even if this does get fixed it will be difficult to recover.�
Jan 19, 2009
Sgee Graham, I dont happen to be on the waiting list for anything of Tesla, and I know you happen to be. That means you will have a little more influence then I will. I am begging you or someone else to PLEASE call, and tell them this is going to be the biggest PR disaster in their history if they don't fix it now.�
Jan 19, 2009
Tim M James: "Based on my VIN # and the timing of when I made my deposit, I don't qualify."
Yeah, I don't qualify either, but this speaks to a larger issue for me and that's integrity. It has been stated here already and I won't rehash it.
I was leaning toward canceling my reservation and have now done so. Mostly the financial climate has pushed me to this sad choice but this is really the icing on the cake that tells me I did the right thing. I wasn't happy when the spec sheet for the 2009 was changed after I had made my "full" deposit. Yes, I did read the contract and changes are allowed without notice. It just makes me wonder about their understanding of what's right and wrong and how that might affect me as a customer of theirs in the future.
Anyone named Tim or Tom want to buy a CA personalized plate?
Tim�
Jan 19, 2009
graham I am waiting to hear back from them. I tried to get some sort of confirmation late last week (admittedly in a back channel) but failed. I am trying a more direct route today - but it is a holiday weekend here.
I know of at least 3 other owners who are in the process of doing the same. I would be surprised if we don't concretely know what the new policy is within the next 24 to 48 hours or so.�
Jan 19, 2009
dba It was in writing and based on Tom's production number versus my locked in production slot I would guess that I am among over 200 people affected by this.
I have never sued anyone, but this a major issue of principle. I locked in on a contract that indicated I stood to lose my $50,000 deposit if I did not take the vehicle listed. I have a copy of my lock-in that includes selected options with prices and a total balance due which only excludes taxes and state fees. My understanding of my state's consumer protection laws would lead me to believe that this contract would not be considered unidirectional.�
Jan 19, 2009
dba I agree that it would be a mistake to not offer new options. The mistake I am referring to is removal of over $5,000 worth of standard features and the doubling of prices on many options on the around 200 owners that have "locked-in." According to the agreement I have the lock-in took you from a refundable deposit to a contract to buy a vehicle as listed. My list clearly shows all the locked-in prices. Unless Tom is wrong and he was not required to accept the new terms and conditions for his car to enter production then someone has indeed made a terrible mistake�
Jan 19, 2009
vfx Tesla folks, take note. Over on the TTAC page the flamers are going on about a "3000 extension cord". There is no one defending you.
The people who can afford it least are the ones online singing your praises. Now in this thread and on ABG, 3 writers have canceled their car because of this bonheaded move.
Is it worth it?�
Jan 19, 2009
vfx I liked BlackbirdHighway's comment too:
�
Jan 20, 2009
vfx Over on Martin's blog "About" page he comments:
�
Jan 20, 2009
dpeilow Another site picks it up: DailyTech - Tesla Motors Raises Roadster Price, Angers Those Who Pre-Ordered�
Jan 20, 2009
vfx Commenter hckhwk:�
Jan 20, 2009
stopcrazypp Looks like Jalopnik picked it up also:
Tesla: Tesla Increases Prices On Already-Ordered Roadsters
Autoblog has it too:
http://www.autoblog.com/2009/01/20/tesla-raises-prices-on-roadster-options-sparks-controversy-ang/
On the one hand, it pains me to see all the Tesla haters get what they want, but on the other hand, we need to get this into the public so that Tesla Motors will fix it (hopefully they do).�
Jan 20, 2009
dpeilow Certainly there seem to be a lot of naysayers jumping on this, which is unfortunate as we are now getting the "told you so" digs on all these sites. If it is the case that Tesla need to show better margins to attract the next round of investment, I'm sure most people here would understand that. No one (here) wants to see the company struggle or worse. But it has been done in a back-to-front manner and the decision to include locked-in customers as well as those further down the list seems questionable. I wonder if a lack of new orders is ultimately behind this?
I'm hoping the silence is a sign that they are considering peoples' feedback and looking at what some alternative (better?) scenarios will do to the business, but all the while the story is being picked up by more and more outlets and it is only a matter of time before it appears outside the car "blogosphere". Hopefully we will get a statement in the very near future.�
Jan 20, 2009
Kevin Harney And now that the story is out there they really can't say "We needed the money" like they could have to the investors. If they do we will hear " TM is going under fast. Jump ship while you can" For someone that is apparently incredibly smart this was an incredibly stupid stunt to pull�
Jan 20, 2009
SteveF I don't know how to link to this, but here is Elon's response (sent via e-mail to owners).
"A much fuller account of the history of Tesla is worth telling at some point, but for now I will just talk about the essentials of why we needed to raise prices on options. Fundamentally, it boils down to taking the tough steps that are difficult but necessary for Tesla to be a healthy company and not fall prey to the recession.
When the initial base price, for cars after the Signature 100 series, of $92k was approved by the board a few years ago, it was based on an estimated vehicle cost of roughly $65k provided by management at the time. This turned out to be wrong by a very large margin.
An audit by one of the Series D investors in the summer of 2007 found that the true cost was closer to $140k, which was obviously an extremely alarming discovery and ultimately led to a near complete change in the makeup of the senior management team. Over the past 18 months, observers will note that Tesla has transformed from having a senior team with very little automotive experience to one with deep automotive bench strength. We now have executives with world class track records running everything from design to engineering to production to finance.
To bring the cost of the car down, we have reengineered the entire drivetrain, which is now at version 1.5 and will be at version 2 by June. The body supplier was also switched out from a little company that was charging us nutty money and had a max production of three per week to Sotira, who supplies high paint quality body panels to Lotus, Aston Martin and others. In the process, we had to pay several million dollars for a whole new set of body tooling, as the old tooling had been made incorrectly. The old HVAC system was unreliable and cost almost as much as a new compact car, so also had to be replaced. The wiring harness, seats, navigation system and instrument panel also had to be modified or replaced.
After reengineering and retooling virtually the entire Roadster and completely restructuring our supply chain, we are now finally coming to the point where the variable cost of the car (to be clear, this excludes fixed cost allocation) is between $90k to $100k. With a lot of additional effort by the Tesla team and the help of our suppliers, we should be at or below $80k by this summer. There is some variability here due to exchange rate shifts. Although we gain an automatic currency hedge by selling in both Europe and the US, we are still vulnerable to the Yen, which is very strong right now.
Obviously, this still creates a serious problem for Tesla in the first half of 2009, given the $92k to $98k price of most cars delivered over this time period. The board and I did not want to do a retroactive increase of the base vehicle price, as that would create an unavoidable hardship for customers. Instead, apart from a $1k destination charge increase to match our true cost of logistics, we only raised the price of the optional elements and provided new options and a new model (Roadster Sport) to help improve the average margin per car.
The plan as currently projected, and which I believe is now realistic, shows a high likelihood of reaching profitability on the Roadster business this summer. By that time, we will be delivering cars that have a base price of $109k plus about $20k or so of options (having worked our way through the $92k to $98k early buyers) at a rate of 30 per week. We are fortunately in the position, rare among carmakers, of not having to worry too much about meeting 2009 sales targets, as we are already sold out through October and have barely touched the European market.
My paramount duty is to ensure that we get from here to there without needing to raise more money in this capital scarce environment, even if things don't go as well as expected. I firmly believe that the plan above will achieve that goal and that it strikes a reasonable compromise between being fair to early customers and ensuring the viability of Tesla, which is obviously in the best interests of all customers. It�s also important to note that the price increases will affect 400 customers, all of whom will take delivery after Jan. 1 and receive a $7,500 federal tax credit. We made the pricing changes to ensure the viability of Tesla in the long term, regardless of government incentives, but we hope the credit will offset the increase for most customers.
There is one additional point that relates to the government loans that Tesla is seeking for the Model S program, a much more affordable sedan that we are trying to bring to market as soon as possible. A key requirement is that any company applying be able to show that it is viable without the loans. If we allow ourselves to lose money on the cars we are shipping today, we place those loans at risk. Mass market electric cars have been my goal from the beginning of Tesla. I don't want and I don't think the vast majority of Tesla customers want us to do anything to jeopardize that objective."
Elon Musk
CEO & Product Architect�
Jan 20, 2009
Bradleybang New Elon Email
removed. Steve posted at same time as me.�
Jan 20, 2009
doug Translation: This was the fault of previous management.
I don't think that's a good way to start such a letter. Customers are pissed, it's better to take responsibility for mistakes (as a company) instead of trying to place blame on particular individuals.
As could be expected, this ignores the fact that they've effectively changed the base price by removing value.
From two days ago:
I think the main problem here is that the explanation should have come before the action, not the other way around. I have to say that this really was a huge mistake. I think many of the upset customers would have understood if this had been handled with a bit more humility and less hubris. Instead they feel disrespected and that their trust has been violated.
I really hope that Tesla can bounce back from this.�
Jan 20, 2009
donauker I must say I do wonder if this is the difference of opinion that caused Darryl Siry to leave? This is a PR disaster of monumental proportions. At this point they can be viewed as either so desperate for cash that they are going for a last ditch money grab or else so untrustworthy that now that the rich and famous have their cars they can just stick it to everyone else.�
Jan 20, 2009
Kevin Harney Donaker,
That is what I said from the beginning. I am sure that DS will not weigh in on this subject but I sure wish he would. Best of luck to them in straighteiing out this fine mess they have created. I am sure that it will be forgotten sometime but certainly not any time soon. Hopefully they can survive until it blows over.�
Jan 20, 2009
dpeilow Well, I'm glad an explanation is out there, but it sure should have come first.
With a slowdown in new orders upon which they could have increased margins, it seems to me they had two options:
1) Lose money on every car, at least until they can get costs down to $80k, but potentially on all 1200 on the waiting list if this takes longer than expected. Thus putting in doubt the ability of the company to raise new money and ultimately its survival.
2) At least try to break even on existing orders, knowing full-well the PR storm that would follow. Ensure Tesla is around in 5+ years' time.
Given the above, it was probably the lesser of two evils. I know that is no comfort if you are involved directly and as I said, it probably could have been handled better (but then hindsight is a wonderful thing). At least the company has a better chance of being there to provide aftersales when you need it and hopefully at some point a Model S for the rest of us. With a bit of luck, some minor event going on in Washington DC will keep this out of the mainstream press...�
Jan 20, 2009
donauker Exactly! This just adds additional insult to the entire situation. He didn't even acknowledge the fact that the base vehicle I agreed to buy has been increased by $5,700 plus the $1,000 added to the destination charge as well as the option increases.
Yes most definitely. This is the group that has been clamoring for the opportunity to put deposits down on the Model S and also to invest in the company. Now even those who already have their car and are not directly affected by this have indicated that they would be far less inclined to do either.�
Jan 20, 2009
shark2k Since I'm more of an outsider looking in, i.e., not actually buying or know anyone personally buying a Tesla Roadster, I got a quick question. Was the destination charge increased to $1,000 or was there an extra $1,000 added? If I recall, I saw the destination charge was $950. Is it now $1,950 or $1,000? Just wanted some clarification.
As to the price increase, I'm not gonna say much on it besides that I think they definitely did this the wrong way. But I'm also hoping they can some how redeem themselves because I was very interested in possibly buying a Model S, but after this little fiasco, I am a little bit more skeptical.
-Shark2k�
Jan 20, 2009
Chris H. Possible Solutions or Suggestions
This is a re-post of a comment that I made on Tesla Founders Blog:
"One suggestion:
How about giving a voucher, or certificate, equal in value to the price difference between the pre-options increase Roadster and the post-options increase Roadster, that is redeemable against the future purchase of a Model S, or a 2010MY Roadster? The voucher should be transferable so that the current Roadster customers can gift it or sell it, if they so choose.
It would allow TM to show the DOE that they are profitable on the Roadster, without customers feeling like they are being mistreated too badly in the short term. It might also result in additional Model S customers in the future."
Any thoughts as to other possible solutions?
Roadster customers: What would make you feel better about this price increase situation?�
Jan 20, 2009
Tdave Most of the talk is about the price increase for locked-in buyers. But what about non locked-in buyers like me? I'm a middle of the pack 2009 "owner" who has $60k on deposit. The first $5k deposit locked in price. The next $55k locked in a production slot. I have the 2009 price list on file that they sent me with my welcome package, and also saved from the website at the time I gave my deposit. That price list includes items on it that have now increased in price.
I fully expect Tesla to honor the prices on the price list that I locked in over 6 months ago. That's the whole point of the first $5k deposit that LOCKED IN PRICE. I'll repeat. The whole point of the first $5k deposit is to lock in the prices on that price list.
What would be smart of Tesla would be to offer an extended options list at new prices to help them increase profits. I thought that's what they were doing -- entice me to spend more on performance and luxury options, above and beyond what I was already planning to spend.
But instead they're increasing prices on items already on the price list back when I made my deposit. To me that seems like breach of contract. I'm not a lawyer, so I don't know for sure, but it sure doesn't pass the smell test.
When I first got the notice of new options, I was excited about the new choices I had available. Now I'm pissed after learning what has really happened.
Way to go Tesla, turning a great positive into a huge negative.�
Jan 20, 2009
JRP3 I'm not telling Elon how to spend his money but isn't he capable of propping up HIS company himself, and not counting on his locked in customers to do so?�
Jan 20, 2009
TEG Tesla nears profitability; Musk explains '07 ouster of CEO
So is this suggesting that old Detroit has more experience keeping costs under control and being realistic? Doesn't the current situation for the "big 3" suggest that this premise is flawed?
Hasn't the Tesla story included the idea that Silicon Valley is the right place to rebirth the auto industry using fresh eyes?
Tesla: A Carmaker With Silicon Valley Spark
Elon Musk - Entrepreneur of the Year - Tesla Motors -SpaceX
Opinion: Funds for clean car tech should not be diverted to Big 3 bailout - By Elon Musk
Why shut down the Michigan office if you think more auto industry experience is what is needed?
Obviously this is a difficult business to grow in a terrible climate, but to say that more auto industry experience is the answer seems out of step with what I thought was part of the company message.�
Jan 20, 2009
doug This article finally includes some comment from Rachel Konrad. I do not envy her position right now.
Greentech Media: Green Light Blog Archive Tesla Jacks Price on Roadster Options
Again, some better communication would have made this less of a fiasco.�
Jan 20, 2009
stopcrazypp Gizmodo picked it up:
Tesla Motors: Tesla Jacks Up Prices On Customers Who Already Ordered a Roadster
So did Wired:
Tesla Raises Prices To 'Guarantee Viability' | Autopia from Wired.com
As mentioned, if they had the explaination BEFORE they moved to increase the prices, this wouldn't have been as huge an issue. I'm sure most of the customers would understand (even though there are still questions if this move is a breach of contract). Now it's all over the blogosphere and might reach some mainstream news soon.�
Jan 20, 2009
Tdave Where was she when the wording of this price increase was vetted BEFORE it was disseminated?�
Jan 20, 2009
doug Yeah. good question.
The Wired quotes appear identical to the those in the Greentech Media article. Likely she's sending out emails trying to get ahead of the story. The Tesla message at this point appears to be, "this was a really tough decision, but we felt we had to do it to keep the company viable." Of course the real issue is that customers feel disrespected, and Wired seems to get that:
�
Jan 20, 2009
TEG It seems that this "additional point" is actually a very key point. The need to get to some level of profitability ASAP or else the loan guarantee falls apart and their plans for 'Model S' could dry up as well. I gather an IPO was supposed to fund 'Model S', but this is not a good time for any kind of IPO. I think there is a lot of sympathy for why they want (and need) to do this, but the 'how' is what has been brought into question.
So, this isn't just about funneling more investor money into the company - it is about showing that their current business model is viable, and that the government will back them up for the next step.
Apparently the immediate time-line made this awkward - it would have been more sensible if they could have left the 2008 pre-orders alone and made a more logical changeover starting with the 2009 model year changes.�
Jan 20, 2009
Palpatine It was $950, it has now been raised to $1,950.
My company transports cars half way across the USA all the time. It costs about $400 to $500 to ship a car via open transport exposed. Shipping via enclosed transport, the way Tesla is doing it, costs about $1,000.�
Jan 20, 2009
shark2k Thanks for the response James.
-Shark2k�
Jan 20, 2009
TDA I believe the $1,950 Destination Fee is to ship your car to your nearest Tesla Store and then to you if you live within 200 miles of it. If you live more than 200 miles from a Tesla Store then you're on the hook for picking up the car yourself or having someone pick it up for you. At one point Tesla was charging something like a flat $5,000 to ship your car to you from California but then later dropped that.�
Jan 20, 2009
Palpatine That might be what Tesla Motors is charging. But that is not the cost Tesla Motors is paying to the shipping company.
Shipping pristine collector cars in an enclosed transport is quite common. It costs about $1,000 for shipping a top quality car with fully protected enclosed transportation. I just today asked my general manager of our store what she typically pays.
If you don't mind the car arriving dirty, it can be via open transport for $500. 99% of the time they arrive needing a good wash, but no exterior damage at all.�
Jan 21, 2009
dpeilow Is this the first confirmation of a version 2.0 drive train on the the Roadster? If the target is to reduce costs (I'm assuming), do we know where there is scope to do this?�
Jan 21, 2009
Michael Has anyone gotten the notice yet that the battery pack specs are changing? The new standard battery will have 27 kw and an aptional battery with 53 kw will be added to the options list for an additional 20k.
If "anything can change", then what else will be removed from the standard vehicle content?
Although the above is only speculation, is there any reason we can point to that would make it not possible to happen?�
Jan 21, 2009
DrTaras Abusus non tollit usum
I was an ideologue for Tesla awaiting a car that I had put down a 50% deposit 2 years ago with no interest & then �locked-in� the remainder of the price and options in November, 2008 for a car that had been delayed until April, 2009. Now they pull the rug up from underneath me and want to charge nearly $10,000 in options? Shady is an understatement! I hope there is a mutiny! Go here for more info: Tesla Increases Prices on Locked-In Orders - Tom Saxton's Blog
A few years ago I opened escrow on a house on a Friday. That next Monday they wanted $10K more and through a loop hole they were able to ask for it & had another buyer lined up (remember those days when the housing market was riding sky high?). Though the house was "worth" the extra $10K and we were emotionally attached, I told my broker & my wife, that on principal I could not continue with the deal. The $10K I thought was just the beginning of something nefarious and not the end. After we walked away we found out that the blue prints for the pool that they had displayed when we walked in to see the house for the 1st time and that were going to be given to us for free so that we could use them to build a pool were useless as the city had determined that the soil was unfit to build any pool there!
So I put to those of you who have "locked-in..." what is Tesla not telling us? And those who have yet to "lock-in" and don't seem affected... what might happen to you when they call your name early because others have dropped out? And those of you who think that $100K is a lot for any car and can't ever dream of spending that kinda dough on a car, ever... How about if it was a $10K car and you were in a similar situation and they told you the price was the same as you had locked it in with that $5K deposit, but the steering wheel was a $1K option?
"All that is needed for evil to succeed is that decent human beings do nothing." -Edmund Burke
"Abusus non tollit usum" - Translation: "Abuse is no argument against proper use"�
Jan 21, 2009
Tdave You're joking, right?�
Jan 21, 2009
Michael I seriously hope so, but how can we be sure it won't happen?�
Jan 21, 2009
dpeilow OK - so you were laying flamebait. With the current stories circulating, I don't think we need to be courting any more controversy.�
Jan 21, 2009
Tdave Indeed. Folks, please identify sarcasm appropriately.�
Jan 21, 2009
vfx First off I would like to take back many of my thoughts and statements about Daryl Siry. This new idiocy still went down even with a new PR team so it's obvious that the spokes-people cannot handle the CEO.
This bodes poorly for the company's future. Elon clearly knows technology but is clueless about people. These actions are exactly oppostite of what they should have done. [New Elon mantra. "What would Apple do?"] Better yet, Hire Guy Kawasaki and let him run the company.
A smart team would suck it up and embrace the early evangalists not anger them. Even if this move was absolutely required to keep the company from going under (more Elon money notwithstanding) then approach the problem with a you-scratch-my-back solution.
State your case (FIRST) and then offer something later in return. Those that put down money have been waiting a long time. Why not do it again on a much smaller scale? Offer an equivalent discount on the next car, or a rebate check in 2 years, a new battery upgrade etc. There are many delayed ways of getting money now and amortizing it into the next season's profits.
The locked in buyers have already shown their support. They are your friends. Friends help each other. Go for the pat on the back not the stab.�
Jan 21, 2009
Palpatine I honestly believe that if Tesla Motors had simply presented the new options as exactly that... new options to improve your Roadster, most owners would have likely bought a few of them.
I think many of us were mentally preparing to purchase a hardtop, either painted or clear carbon fiber. That was a $3,200 or $5,000 upgrade in revenue.
Many 2008 VINs that had an HPC included, were likely planning to purchase a mobile charger at $600 or $1,500.
Many of the other new upgrades are really cool and do raise the quality of the Roadster. There are more carbon fiber options, a Sport option, etc.
If Tesla Motors had just kept the current locked in 2008 VINs at the current level of quality (HPC, wheels, windshield), and then offered the options in addition, then Tesla might have averaged $10,000 in additional revenue per Roadster. Tesla might have even sold a bunch of prepaid replacement batteries at $12,000 and gotten more interest free loans.
But the way this has been done, by downgrading the quality of the Roadster for locked in customers, just has a lot of 2008 customers upset, and rightfully so.
I don't think it is too late to fix this. Perhaps Tesla Motors could reconsider and backup a bit. It is never too late to say, "oops, sorry we weren't thinking this through logically because of the rush going on at the Detroit Auto Show. Here is the fix."�
Jan 21, 2009
lbaroody Why the High Delivery Charge?
I had heard that in order to get some speed and momentum on deliveries given all of the delays, gliders were being transported by air from the UK to California. This may explain the extra $1,000 delivery charge. It's one more way to pass on their higher costs (which Tesla by itself chose to incur). Tesla is behaving very naively and stupidly - that somehow the risks of starting the business need to be passed on to their early customers who helped get them started.
The increase in $25 for the floor mats says it all. This is the ultimate nickel and diming.�
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