The number of people willing to plunk down a $1,000 deposit for a Tesla Model 3 currently stands at about 455,000. In the third quarter of 2017, Tesla delivered 220 units of its smallest and most affordable electric car. Last quarter, some 1,550 buyers took ownership.
If it looks like it’s shaping up to be a long wait for the newest reservation holders, you’re right. Tesla claims it has succeeded in working out some of the issues hampering production at its Fremont, California assembly plant, but the pushed-back ramp-up of Model 3 production means some reservation holders won’t see their new car this decade. Meanwhile, you can not only walk into a General Motors dealer and order a Chevrolet Bolt today, but you can expect delivery well before the 2020 election campaign gets into full swing.
Is GM planning to exploit its competitor’s production woes? Not us, the automaker claims.
Speaking to Automotive News, Steve Majoros, marketing director of Chevrolet cars and crossovers, said a targeted campaign is “not in the cards.”
If it did, it wouldn’t be first time an automaker tried to lure Model 3 groupies away from the band. In early 2016, Nissan launched an ad aimed at those waiting for Tesla’s upcoming wundersedan. “Why wait when you can drive an all-electric Nissan Leaf today?” the cheeky company stated, hammering the point home by saying, “No one should have any reservations about getting an electric car today.”
Nissan also tossed incentives at would-be buyers in the hopes of picking up some fence sitters. of course, brand loyalty plays a big part in electric vehicle purchasing, and there’s no group of people more willing to wait for a car than Tesla devotees. Should any of these reservation holders grow tired of sitting by the phone, Nissan’s second-generation Leaf is currently waiting at the door, flowers in hand. It’s part of a growing segment that includes the Bolt and Hyundai Ioniq.
One of the reasons for GM’s attitude could be the Bolt’s strong sales numbers. Since availability reached all 50 states last summer, GM has seen Bolt sales rise each consecutive month. No need to rock the EV boat, perhaps. December saw the model top the 3,000-unit mark in the U.S. (3,227, to be exact), with volume for the whole year standing at 23,297 vehicles.
Both Bolt and Model 3 share a similar entry price, with the GM vehicle edging out the base Model 3 in terms of range. Pricier, 300-mile Long Range variants were first off the Tesla assembly line.
In a statement, Tesla claims it is “very appreciative” of the customers who “continue to stick by” the company. GM says a study group held last year showed early Bolt buyers remained fairly interested in the Model 3, though Majoros told AN that Chevy has seen an unspecified number of Tesla buyers show up looking for an EV. It’s quite possible that, in some cases, the Bolt is the model holding over the buyer until the Model 3 wait window closes.
In its quarterly update, Tesla said it expects to produce 3,000 Model 3s per week by the end of the second quarter of 2018. When production kicked off, the company hoped to hit that mark by the end of 2017.
[Image: General Motors]
“Is GM planning to exploit its competitor’s production woes? Not us, the automaker claims.”
Why market a car you lose money on? GM would rather sell Silverados.
.
.
^^ This. While I don’t believe the wild reports about $$ losses on the Bolt, it’s surely not profitable.
I’m already seeing them discounted 40% at some dealers.
I am with you; I don’t believe they lose money on each Bolt sold. But I wouldn’t be surprised if the Bolt were a net loss today as a program. The question then becomes when does GM break even on the Bolt? I am sure some bean counter at GM knows that, but I don’t.
I don’t think the problem with the Bolt is that it is a loss leader. I think the problem is that it is not as sleek and sexy or attractive as the Model 3, or any other Tesla for that matter.
It is quite boxy and small.
GM would have been better off making a Bolt, but also making a Volt EV. At least that car is a lot better looking. Maybe they could make the Volt EV look sleeker.
I also hear that GM has some CUV BEV’s and an all electric super sports car in the works…
Very true – people shopping for a Tesla are not looking at GM products (Bolts, Volts or others). While the Bolt may offer the similar EV range and price it is worlds apart for the Tesla in appearance, style, performance, desirability, etc.
” I think the problem is that it is not as sleek and sexy or attractive as the Model 3, or any other Tesla for that matter.”
I think that’s the biggest appeal for most Model 3 buyers anyway. The Model S is pretty awesome, and the model X is what it is. But by starting with the halo models before working themselves down to the plebian models, people associate the brand with cool, expensive, luxury. So then they line up to buy a mainstream car that probably is no cooler or more luxurious than anything else in it’s price segment, but since it doesn’t look like a penalty box they’re sold. Realistically you could get a Bolt on a 3 year lease and it still wouldn’t be your turn to order a Model 3 before it was time to turn in the Bolt.
That is another part of the problem; the dealers that carry the Bolt seem to have multiple to choose from and are sometimes discounting them to help move the inventory. The majority of dealers around me refuse to even carry the Bolt. They were burned when GM made them carry the first-gen Volt and they sat unsold on the lots for months. So now these dealers are unwilling to even take a risk on carrying the Bolt in inventory. Especially not when they can fill that inventory slot with a similarly-priced Colorado with 0% interest that will sell within a week. It’s hard to sell a car you can’t even test drive at a dealership close to you.
@SCE to AUX:
You’ve seen new Bolts being discounted 40%? Where? Can you give us a link? My guess is that you’ve been seeing dealers advertising prices that include the potential federal credit and any state incentives in the price.
But if you can point me to a dealer actually offering a discount of 40% off the price of a new Bolt, not including fed/state incentives, give me a link and I’ll call them with a deposit today. I don’t particularly like the Bolt, but at 40% off I’d happily commute in it.
@Thinkin…:
https://www.cars.com/vehicledetail/detail/702423090/overview/
I don’t think this number includes the incentives. Their price has dropped several times, with the last reduction being over $3000.
Sadly, that price/car is clickbait it seems. I just called; they don’t have any Bolts in stock at all – you can check their website directly.:
http://www.billdelucachevroletbuickgmc.com/
But they’re awfully anxious to get you in the showroom. Pretty bad online reviews as well.
Uhm,… Tesla hasn’t made any profit either, so why are they also marketing their loss leaders?
That’s they’re only game, as you know.
As a Model 3 reservation holder, it’s been annoying/humorous to be plied with emails from Tesla asking me to consider buying a Model S instead of a 3.
That’s partly because people buy a Silverado , not an overpriced electric.
Only Tesla cult members, foolishly thinking they will rid the planet of that nasty, life-sustaining CO2, will pay $60,000 for an affordable “$35,000” vehicle and be joyous that the company saw fit to rape them financially and intellectually I doubt that any company wants customers like those who flock to P.T. Barnum Musk as their leader and savior, albeit a lying savior.
If I cancel my Model 3 reservation, it will probably be due to my concerns about features, price, quality, and support, rather than schedule.
I heard a few others say the same thing a year ago, when they were told their car would be available late 2017, then early 2018. But now their new car needs are getting closer. Many have leases that are going to end. Those plans were based on talk from Tesla, E.M. and are now being changed. So, if the other vehicles are available, it is possible that their minds can be changed easily.
Those are at least partially linked. The later the Model 3 ships, the more competition it will face at its price point for features and quality.
Today one could probably make a decent case for the Model 3 compared to its competitors. In two years? Not so sure.
Same. One of the reasons I picked up a MY16 car in the interim was the expectation of product delays on the model 3.
Realistically every car in this segment is going to be supply constrained on batteries, anyway.
The Ford Focus EV lease is very attractive. I wonder how it will sell this year.
My wife picked one up this fall, 18k after rebates and tax credit. She loves it. We live in a town only accessible by ferry or plane so the 115 mile range is plenty. For a second car most places it would be a great ccar.
Most of the people who put down $1000 deposits on the Model 3 can afford to live without that money and had no concern about holding off on purchasing a car for 3-4 years. They were just purchasing a place in line for the latest gadget from Tesla.
The Bolt and Model 3 also are not at all competitors. It’s like saying an optioned-up Civic Hatchback is a competitor to the Mercedes CLA250 because they happen to (barely) overlap in price. The Bolt actually is available in the $35k-$40k price range before incentives. The actual price of the Model 3 is $15k+ higher. Yes, there will ultimately be a single configuration of Model 3 available (with zero options, probably not even color) for $35k after incentives. But much like no one wants a stripper Mercedes CLA, few will actually buy a stripper Model 3. And don’t act surprised when Tesla pulls that $35k stripper Model 3 from the market after a few months due to “lack of demand”.
“The Bolt and Model 3 also are not at all competitors.”
Not exactly true. Many EV buyers simply like the driving dynamics and low operating costs of electric, and are shopping for range. If range is the priority, the Bolt is a low-drama way to get the most range for your budget (which for most people doesn’t reach up to $50k).
But you’re right about the mythical stripper Model 3; it may never actually appear.
I believe that a significant number of Model 3 deposits were based on 2 things:
1. The $7500 tax credit
2. Being able to get a base model
It appears that TSLA has decided that it isn’t time to build “stripper” models yet, so there is a chance that some of those with the $1k deposit may have to make a different buying decision based on availability. I still can’t figure out the math on shipments per Quarter as to how long the EV credit will last (would love enlightenment on that), but I believe there were many (maybe 25-30%?) that were banking on items #1 and 2 above.
I find it more than mildly amusing that right now, if you “just can’t wait”, roll on over to eBay and you can have your pick of the litter. It’s like concert ticket scalping on a whole different level.
” and had no concern about holding off on purchasing a car for 3-4 years. ”
At their current rates it could well be longer than 3-4 years.
GM knows how to make up their losses in volume. That’s how they got to be GM.
Seriously though, when did the retail car business turn into being nice to competitors? GM marketing is idiotic for not trying to squeeze that smug little twit Musk by his neck.
While Jim Dollinger is a bit of a broken record, he’s right about GM marketing — the results don’t change, only the excuses. The fact that GM isn’t blasting Bolt availability to Model 3 buyers RIGHT NOW is inexcusable.
There is no way that Tesla can satisfy 455,000 deposits within the next year, or even 3 years, and that assumes they stay afloat as an independent company.
GM can’t and won’t satisfy that level of demand either with Bolt/Volt. What they can do is go a long way towards changing perceptions with a good product in this niche. They can also recoup those development costs.
If GM offered Model 3 reservation holders a buying incentive (like $4k in conquest cash), I’d probably cancel my Model 3 reservation and bolt to a Bolt.
That’s what I was thinking they should do. Call it a “buy out of your Model 3 reservation” or something similar.
Honestly, I wish both companies luck with their offerings. I’m not at all impressed by the level of insanity that some Tesla fans seem to have, its not beneficial to the company to be so narrow-minded and to go around promoting false truths. The extreme hype won’t build Tesla into what they dream of, although it seems to be their method of madness right now.
If I come across as a Tesla hater, I’m not. I’m just allergic to BS. I’m agnostic towards the company on the whole, but as I said, I do wish them success.
GM’s strategy is the right one. Think about who buys Teslas:
A) Earnest environmentalists. Tesla is much beloved in this crowd, and conventional automakers are much distrusted. If Tesla fails, GM doesn’t want to be accused of causing it. (Next documentary: “Who Killed The Only Actually-Desirable Electric Car?”) GM must maintain some degree of green cred if they’re to sell enough EVs to meet their CAFE & CARB needs.
B) Tesla fanboys. Like Apple fanboys, they won’t even consider any other brand. Any marketing directed to them will just give them something to mock online. Don’t poke the trolls.
C) Status seekers. A Tesla is still a status symbol and a lovely object of desire. These folks are not buying a “goddamned Chevrolet,” especially one that looks like the cleaning lady’s Honda Fit.
D) Rich narcissists. They think they know better than other people (aka “losers”) and they are NOT going to have anyone tell them what to do, which is why Tesla’s no-advertising strategy works so well on them. They’re only going to buy a Bolt if they think it was their idea.
E) EV enthusiasts. They’re on the Model 3 waiting list but they also know “12 months” in Tesla-speak means “36 months” in reality, so they’ve already leased a Bolt while waiting for their Model 3 to arrive.
F) Car enthusiasts. They’ve already done their research. Those who want a long-range EV and get tired of waiting for a Model 3 demonstrator to show up at their Tesla dealer will eventually get a Bolt. You might move their decision up 6 months but you won’t change it.
Excellent list. I guess I’d fall into groups “E” and “F”.
When I reserved on Day 1 (31 Mar 2016), I expected a 2-year wait. But since Tesla appears to be about 6 months behind in Model 3 production, I’m guessing ~30 months, making it September 2018 or so.
I won’t commit more money without a test drive.
It’s amazing how many people still don’t get Tesla. It’s not a car company, it’s a virtue signaling company. You don’t buy a Tesla to have a car, you buy it to make a statement. So it doesn’t matter if the Model 3 is a year behind schedule. As long as it’s still cool in Santa Monica and Los Gatos, the wanna bes will line up like lemmings to keep buying one.
Also see Apple.
Agree with your analysis on Tesla buyers…at this point in the game it’s way to early to decide if they have a viable future in the business. The fact that Musk is teasing semi-trucks, pickups, and probably next pleasure boats, motorcycles, and light aircraft makes me wonder.
indi500fan,
Musk is also using these conceptual “virtual signals” of prime movers, pickups and supercars to boost his cash reserves to hang in there until the inevitable demise of Tesla comes and its sold of to the Chinese.
I wonder how many will be burnt by Tesla? With its overly high stock prices and deposits on concepts cars and trucks?
I vowed the next time someone used the “virtue signalling” accusation I would unload on them. So you just happen to be the chance target.
If you knew what virtue signalling really is, you’d know that organisms “virtue signal” frequently. Humans, like you, and me, virtue signal almost non-stop. Making an accusation of virtue signalling before the ttac receptive audience is itself virtue signalling.
Except for the basic functional stuff, every aspect of car marketing comprises virtue signalling. Mazda’s zoom-zoom, pickup’s tow ratings, the detailed mechanical spec logos on the back of German sedans, the menacing styling and sounds of muscle cars. It’s ALL virtue signalling.
So to point to buyers of “green” cars and smugly accuse them of virtue signalling, is to wear a tatoo on one’s forehead that says: “I’m an arrogant idiot.”
I’ll go farther. The reason why buyers of “green” cars so upset those like you who are foolish enough to accuse them of virtue signalling, is because deeper down you know that their choices in cars show that they are smarter and more responsible than you are. They ARE better people. So rather than have the brains and character to follow their example, the best you can do is flap your greasy lips uttering your idiotic accusation.
And that is a truth about some car people.
“wear a tatoo on one’s forehead that says: “I’m an arrogant idiot.”
“is because deeper down you know that their choices in cars show that they are smarter and more responsible than you are. They ARE better people. So rather than have the brains and character to follow their example, the best you can do is flap your greasy lips uttering your idiotic accusation.”
Ah more of that famous Lefty tolerance
brandloyalty,
Mazda’s Zoom, Zoom pickup adds here in Australia used towing as an advantage. The BT50 is now holding value better than the Hilux and Ranger because of the geriatric Grey Nomads are buying them for their retirement tow vehicles, so they can a few years driving around Australia.
“I vowed the next time someone used the “virtue signalling” accusation I would unload on them . . .”
And totally confirm the stereotype of arrogant narcissist?
I’m not sure which side it is you’re unloading on here, but I don’t doubt it smells good to you either way.
Virtue signaling is a near-perfect term. It puts me in mind of one of my favorite memes…”You don’t have to put an Obama bumper sticker on your Prius…we get it.”
@Sub-600: What would it have meant if I put a Bush sticker on my Leaf?
I don’t know. However, finding a leaf on a bush isn’t uncommon at all.
“Making an accusation of virtue signalling before the receptive TTAC audience is itself virtue signalling.”
Exactly this!!
OK, I’m glad you thought you learned some new phrase from Breitbart. Now that’s “virtual signalling”. I was stationed in Iraq with both Tesla S owners that I know. Yes, one took me on a ludicrous mode launch. He used to own an air-cooled 911 and sold it to buy his Tesla. Oh, and there were Montessori school bills to pay and a new bike was needed. The other S owner sold his C5 Vette to by an S. Both talk of much, much lower maintenance costs. Both these guys were Special Forces officers. No, they’re not the “Coastal Liberals” you vainly try to portray Tesla owners as being. As for Apple, they made breakthrough items like the iPod and moved iPod tech to their phones. Apple also understands that tech products can look good. When I hit the road; 2 of 3 IT guys are carrying Mac books. I’m sure you can wear your MAGA hat to Big Lots and find tech “almost as good as Apple”.
“OK, I’m glad you thought you learned some new phrase from Breitbart.”
How much rent does Breitbart pay to live in your head?
” Tesla claims it has succeeded in working out some of the issues hampering production ”
Someone found the on-off switch on that Michigan-made pre-built production line, perhaps?
Sedan sales are falling off everywhere, but up to 445,000 deposit-waving semi-delusional folk like them just fine in Model 3 duds. They want to be part of a religious movement.
Judging by the 550 per month build rate in QTR 4, they’re being built by people wielding rubber mallets and tinsnips while trireme-trained taskmasters flick whips over the straining crew. Of course, the official reason is that the Gigafactory cannot weld those cells into battery packs quickly enough.
This charade has gone on long enough, surely. It’s time to sh!t or get off the pot when you are so vertically integrated, responsible for most of the bits and pieces yourself.
Next we’ll find out that the $35K price really was a come-on.
Are you saying that because sedans are losing popularity, Model 3 buyers have a misplaced interest in that car and really ought to buy a CUV?
Is it possible they just prefer low operating costs in a nice-looking car that does 0-60 in 4.7 seconds? No, that’s not possible; it must be a religious thing because stereotypes work best on TTAC.
About a year ago I took a tour of Tesla’s factory. The tour guides were oh so proud of how the company had reinvented automotive manufacturing. Meanwhile I was wondering why they were turning out one vehicle per hour from a factory Toyota used to make one vehicles per 30 seconds in.
It is cliche, but still true, so say that Toyota has forgotten more about high quality volume production than Tesla management knows.
John,
I think the biggest problem at Tesla is Musk. His visions, which he has many visions (some are interesting) are complicating the production side of his business. Musk should just let the subject matter experts do their job.
He must listen to them. I think the best chance anyone has of ever seeing a Model 3 is someone/s need to force Musk into offloading Tesla.
I had a “Big Al” vision, many will lose lots of money soon in Tesla or dealing with Tesla.
I think Sergio is a far better operator than Musk.