Tesla Claims The Model 3 Will Outsell Both BMW and Mercedes In First Year

I hope so! Competition makes everything better!

When can we see the Model 3 Elon? You and Tesla have a lot of hype to live up to!

If Tesla succeeds with the Model 3, it will really be the FIRST automaker to successfully move downmarket with its volume. Although other upmarket brands sell downmarket vehicles, those downmarket product lines (which are much, much less profitable) really exist solely to drive more customers to the higher margin upmarket vehicles.

Selling 'entry-level' has never been an effective strategy in the auto business.

Very curious how this works out.

My understanding is the opposite of yours:

(1) The luxury brands (e.g., Mercedes, Porsche) HAVE successfully moved down-market. For example, Mercedes, who was known for their large luxury sedans, moved down-market in the 1980s with the 190E (W201 body style).

(2) Although automakers have higher margins (i.e., more profit per vehicle) in their high-end models, they often generate more total profit (i.e., margin x units sold) from their lower-end vehicles due to sales volume. For those who consider Tesla a luxury brand (due to the high price tag of the S and X models, and not necessarily due to their styling, materials, fit and finish, etc.), and therefore compare it to BMW, note that BMW generates a lot more total profit from the sale of their lower-end 3-series than they do from the 5, 6, or 7 series. This is not uncommon.

So to recap: Yes, other automakers have successfully moved down-market, and they have made their bread and butter there. Tesla won't be the first to try or succeed.


That aside, Tesla's challenge is to someday consistently turn a profit. Depending on capital markets to survive is not an effective long-term strategy.

Mini was an example of BMW successfully moving downmarket. Smart is a counterexample of Mercedes not being quite successful. So is Scion in the US.

I disagree -

Mercedes didn't start 100+ years ago with the S-Class equivalent and then try to launch the A, C, and E.

BMW didn't start 30 years ago with the 7-Series - it started with the 2002 and the 3-series, then slowly feathered in the upmarket 5, 6, 7, and 8 Series.

Audi didn't start in the 1970s' with the A8 - it started with the Audi 80 (VW golf/Passat relative) and the Audi 90, launching the A8 in the 2000's once established as a brand.

Lexus and Infiniti DID start with nice luxury cars (LS400 and Q45) but their lineup was then filled up with badge-engineered versions of Toyota's and Nissan's.

Etc, etc.

Tesla is forging new territory here. If Tesla's cost structure is sized to launch premium, top line vehicles, it will be a challenge to 'dumb it down' so that the Model 3 can be built cheaply enough to turn a profit.

Tesla is great company just start building cars and they are doing great...

But to challenge Germans, I don't think so. I am sure they may be lacking in electric car technology, but I am sure they can easily do better than Tesla if they think Tesla is threat to their business, they we do it everything better.

At what point did total sales of a particular entry level car indicate anything. Hyundai probably outsold BMW early on too. And remember that the Ford Granada was A LOT LIKE MERCEDES FOR A WHOLE LOT LESS!

If competition makes everyone better - then those who buy a Tesla 3 - and who put in a deposit betting that their deposit would become a profit - will be the losers when there are more cars available in the segment - and Tesla will still try to maintain set pricing. Either car sales will plummet - or eventually Tesla will have to negotiate pricing - which will reduce resale values. Remember- we don't really know much about resale values of EV's - small sample.

When BMW, Audi and Mercedes-Benz start launching their own all-electric vehicles, and they will be doing so within the next two years, how will Tesla be able to compete with the economies of scale those brands benefit from?

I don't see how Tesla will be able to manage the same cost savings that the Big German 3 will enjoy due to their much higher volumes when you look at their total annual global sales volume. This means the German 3 will produce similar vehicles at higher margins than Tesla.

I find it hilarious that the Tesla fanboys think a ten-fold increase in sales and production (1) happens just like that and that (2) the volume is sustainable. Even if they have the 400K orders, does anyone really believe the Model 3 will continue at that pace? Then factor in skipping the prototype phase of testing. Oh Lord, have mercy. Moreover, Tesla has had a sales slide for January and February. Mercedes and BMW are no doubt laughing.

The 400k orders are only the extreme early adopters that are willing to buy a car they have never even seen in person or sat in before. If the product is solid then those 400k owners are going to attract an order of magnitude more buyers. That is exactly why the Model S became so successful and why Tesla spends $0 on salespeople or marketing.

Being first can be a big advantage, Prius for example 20 years later cannot be touched by the Germans. Of course, Europe bet on diesel instead which is now looking like a dead end. This time they seem to be planning to be a quick follower.

They were first with a long-rang electric car.

Musk hyping the market prior to another $1.5B capital raise or is he starting to drink his own coo laid and buy his own shit?

I want Tesla to succeed but I know the difference between shit and shinola.

I would call it a premium car, not a luxury car. An iPhone is a premium phone, not a luxury phone (that would be a Vertu, etc.)