A quick reminder on the timeline for the Tesla Motors affordable mass production electric car. I’ve seen a few news articles the last couple days suggesting the “cheaper” Tesla electric car will “debut” in 2015. Article titles like “Tesla’s More Affordable Model E May Hit the Road in 2015” are a little misleading, because Tesla’s 3rd generation car is slated to go on sale in 2017.
The misunderstanding comes from an Autobild article where Tesla Chief Designer Franz von Holzhausen is interviewed. In the article, von Holzhausen is quoted talking about a 2015 date for the 3rd generation Tesla electric car. When Autoblog Green and other outlets saw this, they initially ran with the idea that Tesla had changed the scheduling of the new car. Autoblog Green later appended this update to the piece:
UPDATE: Tesla Communications’ Patrick Jones emailed AutoblogGreen to say that Von Holzhausen’s interview wasn’t quite accurate. He said, “I just want to clarify the timeline has not changed and to say that the vehicle will definitively arrive in 2015 is not accurate. … We have not confirmed an unveiling at Detroit Auto Show 2015 and the timeline for a consumer roll out has not changed.”
Last October, Tesla CEO Elon Musk had said the “first prototype” of the 3rd generation Tesla would be available in 12-18 months. Doing some calendar math, that strongly implies an unveiling in late 2014 to early 2015. Unveiling their 3rd generation at the 2015 North American International Auto Show in Detroit (January 2015) would plop right in the middle of that time, but in the past Tesla has shown an ability to stage their own press events.
The timing is also compatible with the unveiling of the Tesla Model X. The first prototypes were shown in 2012, and the car is slated to go into production in late 2014. That gave Tesla’s designers a two year lead time to gather public feedback, and refine the design.
As for the price – what Elon Musk said during quarterly conference calls is the target MSRP is $35,000 before any tax credits or other government subsidies. And, that production volume would be upward of 200,000 cars per year. And that at this production volume Tesla’s appetite for lithium-ion battery cells would completely swamp the existing world production capacity, and therefore Tesla was in discussion with battery makers to construct what’s now being called the Tesla Gigafactory.
Where Musk was definitive, during analyst conference calls, in saying the MSRP would be $35,000, others are reporting a price at $40,000. PlugInCars has a report listing various statements over the pricing. Of course Tesla is going to offer a range of options, probably multiple battery pack sizes, and may make Supercharger access an add-on. We won’t know for certain what the pricing is until Tesla Motors announces what it will be.
All of this fits perfectly with the The Secret Tesla Motors Master Plan that Elon Musk posted on the Tesla blog way back in 2006. Martin Eberhard was still recognized as the co-Founder/CEO, that’s how long ago this was. The plan is a very interesting read, it destroys two of the big critiques against electric cars, and it lays out the plan that is still unfolding nearly 10 years later:
The strategy of Tesla is to enter at the high end of the market, where customers are prepared to pay a premium, and then drive down market as fast as possible to higher unit volume and lower prices with each successive model.
Without giving away too much, I can say that the second model will be a sporty four door family car at roughly half the $89k price point of the Tesla Roadster and the third model will be even more affordable. In keeping with a fast growing technology company, all free cash flow is plowed back into R&D to drive down the costs and bring the follow on products to market as fast as possible. When someone buys the Tesla Roadster sports car, they are actually helping pay for development of the low cost family car.
- Build sports car
- Use that money to build an affordable car
- Use that money to build an even more affordable car
- While doing above, also provide zero emission electric power generation options
What’s happened since isn’t exactly that plan, but it’s pretty close. They had to increase the price of the Roadster, for example. The 2nd generation car had a starting price around $60,000 which is quite a bit less than the Roadster’s starting price. The 2nd iteration of the 2nd generation car, the Tesla Model X, hasn’t been priced yet, but it’s a fair bet it’ll be priced similarly to the Model S. The Model E or whatever it’ll be named will fit the pattern of “even more affordable car.”
As for zero emission electric power generation, that’s being offered by Solar City. Further, the Supercharger network is supposed to (eventually) become solar powered.
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