Tesla's
most popular EV yet
isn't even for sale yet
An artist's rendering
of what it might look like
The actual finalized version is a closely guarded secret
When
potential buyers of EVs are surveyed and asked what is their most important
buying consideration, most people say "price". Understandably,
affordability is the biggest buying consideration by far for most people.
And Tesla EVs have come down in price, now at parity with gas-powered
cars. But Tesla still doesn't sell a "down-market" vehicle,
which is one that sells for under $30,000. But they will soon!
It's already been designed, and its construction plans have been finalized,
now the production facilities need to be built out. But since it will
be a very popular car, it won't be built in just one factory...
it will be built in four factories. And one of those factories
hasn't been built yet (starting construction in 2024). The other three
factory locations have plenty of room on their properties to add an assembly
line building for the new vehicle.
The car will have Tesla's well known cutting edge technology and the ability
to do over-the-air updates of its software. And it comes with a world-wide
network of Tesla charging stations (no other manufacturer making EVs has
their own). It won't have all the bells and whistles of their higher priced
cars, but that's the way it should be; it's a car for those who want solid
transportation at a very low TCO (Total Cost of Ownership).
TCO includes:
* Purchase price
* Fueling costs over the entire time of ownership
* Out-of-warranty repairs
* Auto insurance
Purchase price: This price depends heavily on how much it costs the manufacturer to build the car, how much markup the manufacturer puts on the car when it sells them to their dealers, and on how much markup the dealer places on the car when it sells to the consumer. With a Tesla, there is no dealer, so no dealer markups. And Tesla's manufacturing innovations have resulted in the lowest cost to build a car, and that translates into a lower purchase price. With Tesla's new third generation vehicle – the compact EV – the manufacturing costs will be super low, which means the car's selling price will be super low, around $22,000. (The average price for a used car in the U.S. is $26,200, and that's a gasoline burning car!) So the TAM (Total Addressable Market) for this vehicle will be more than all their other vehicles combined.
Fueling costs: There's a huge difference between the cost per unit of energy of gasoline, and the cost per unit of energy of electricity. Electricity is less expensive than gasoline, per unit of energy. But the good news doesn't stop there. What also impacts your fueling costs is the efficiency of the device that moves the car. The more efficient it is, the less you pay at the pump (whether it's a gas pump or a electricity pump). Would you rather have a gas car that gets 25 MPG (the average), or a gas car that gets 80 MPG. The 80 MPG one, right? Of course! So how about a car that can get 120 MPGe? Even better! But to get that, it must be an EV. Why? Because an electric motor is far more efficient, energy-usage-wise than a gasoline burning engine. So due to these two factors, it can cost 75% less to fuel an EV, dollar-wise. And over time, this matters, a lot!
Out-of-warranty repairs: Since there's less to break on an EV, there's less to repair. And since the parts that an EV does have are less prone to breaking, there will be less out-of-warranty repairs. Remember, EVs have no: engine, transmission, exhaust system, muffler, alternator, high pressure high temperature cooling system, spark plugs, fuel injectors, belts, high pressure hoses, and there are no oil changes. And keep in mind that traditional car dealers make the bulk of their profits from their service departments, but a company selling an EV won't be able to do that, so it's no wonder that Tesla has stated that their service centers will not be a revenue stream for them. Meaning, it will be less expensive to do a repair at a Tesla service center than at a gas-powered car dealer's service center (or at your neighborhood mechanic). Tesla has stated that their profits will come exclusively from the sale of their cars and from their online merch store (hats, T-shirts, mugs, etc). Oh, and also from their energy products and their robotics division.
Auto insurance: Tesla is selling their own auto insurance for their cars! Why? Too many traditional auto insurance companies were overcharging for Tesla EVs. Tesla owners complained about this to Tesla's CEO, Elon Musk. So he initiated their own insurance offering. And since it can be based on how safely their car is driven, your monthly premium can be based on how safe a driver you are. Perfect for safe drivers; not so good for reckless drivers (who will pay a higher premium).
Where will this third generation Tesla car be built?
Tesla's existing Shanghai,
China factory will add another building next to it
Tesla's existing Berlin,
Germany factory will add another building next to it
Tesla's Austin, Texas
factory is so large that no other buildings need to be built
!
This is the new factory
that will start construction in 2024, exclusively for the 3rd gen model
(Mexico has more trading partners around the world than the U.S. does,
that's why Mexico)
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Evidence in support
of the above
EV Buyer's Guide