Tesla Delaying Deliveries of Standard Range Model 3
The saga of the $35,000 Tesla Model 3 rolls on, as customers report Tesla is delaying deliveries and attempting to upsell them.
One week from today it will have been three years since Elon Musk revealed Tesla's long-awaited affordable electric car, the Model 3. Though deliveries of high-spec Model 3s began in July of 2017, anyone who wanted the version that actually costs $35,000 before tax incentives couldn't even order one until the end of last month. Now it seems the long wait for the Standard Range Model 3 is about to become even longer, as customers report that Tesla is delaying scheduled delivery dates and trying to upsell them to more expensive versions.
According to multiple reports at the official Tesla.com forums, Tesla Motors Club, Model 3 Owners Club and Reddit's r/teslamotors forum, Tesla has been texting customers to delay previously-scheduled deliveries of the long-awaited base model. Many of these owners report that delivery dates had been scheduled for the final weekend of the quarter, when Tesla typically schedules major delivery pushes, but the text messages informing them of the delivery delay do not specify a new delivery date. "Our apologies, we will need to reschedule your delivery appointment to a later date," these messages reportedly read. "A Tesla representative will reach out when we have a better estimate of your delivery timing from Tesla."
These now-delayed "tentative" delivery dates had been communicated to customers via text message from Tesla, but no further communication has been reported besides the delay notice. Several owners report that their accounts now state that delivery of their Standard Range orders will take place in six to eight weeks, but Tesla employees say these are automatically-generated estimates and not commitments. These estimates were initially set at 2-4 weeks for customers who ordered as soon as the announcement was made on February 28, but Musk said during the announcement call that deliveries could take longer than that depending on how long customers have been holding reservations. According to Musk:
"Well the priority is for longtime reservation holders so we would first need to assess how many of the long term reservation holders want the $35,000 car. So it really depends on on that on that and obviously this news has been embargoed until now so we first need to assess how many of the reservation holders wish to buy that car. They will get priority and then it will be new new orders. But I do. But I should say that it is very likely that someone who orders will get the car in the US by the end of June, let's say - before the before the next tax credit cliff."
Though none of these customers report any further insight from Tesla into their eventual delivery date, several of them do report phone calls from the company attempting to upsell them to more expensive versions of the car. "I just got a call from someone at Tesla asking me to pay more for the longer range model 3," reports one customer on Reddit. "Otherwise, my configuration won’t be ready until the end of June. This is after telling me my car would be ready by the end of March and having me cough up more cash when I ordered." Customers waiting for delivery on other trim levels also report calls from Tesla trying to upsell them to higher specs, as well as pitching the company's solar roof.
The fact that not a single Standard Range vehicle has been reported delivered, or even confirmed seen in the wild, suggests that Tesla may not have even built any. Since every trim level other than the base Standard Range is being delivered, including the so-called Standard Range Plus, customers are calling the move a "bait and switch" and wondering if the Tesla ever planned on delivering Standard Range cars this quarter. "I got the same delayed delivery text today after a call asking if I wanted to upgrade to a SR+," reported one relatively forgiving customer on TMC. "I don’t blame them but looks like they sent those dates to try to push some upgrades." "I assume its a tactic for last minute upgrades to SR+ or another version," says another.
It's possible that the delay is simply the product of an overloaded delivery infrastructure. Musk recently told Tesla employees to "please consider your primary priority to be helping with vehicle deliveries," as "a massive wave of deliveries" in North America, Europe and China stress the firm's delivery infrastructure. "North America is also stressed, as the final month of this quarter is almost all North America builds," he wrote in a companywide email published by CNBC. "Moreover, for the first two weeks of March, most cars were sent from our factory in California to the East Coast to ensure arrival before the end of quarter."
If deliveries of the Standard Range Model 3 are simply being delayed until after the end of the quarter, either for logistical or financial reasons, customers hope that this delay won't take much longer. Beyond the sheer length of the wait, which will pass the three year mark since some of the customers whose deliveries have been canceled first made deposits, if delivery slips past the end of June it would mean a further reduction in the tax credit from $3,750 to $1,875. This would be yet another blow to customers who have been waiting years in order to stretch into a Model 3 and need all the help they can get.
Finally, this raises the question of whether Tesla is really serious about delivering a $35,000 car in meaningful volume or if the Standard Range Model 3 will be a repeat of the 40 kWh Model S. Tesla heavily hyped the Model S base price of $50,000 after the $7,5000 tax credit as evidence of Elon Musk's "master plan" in action, only to cut it from the lineup after just a handful of deliveries. At the time Tesla said that only four percent of customers chose the smallest pack, "which is not enough to justify production of that version," although delaying its availability and making it the only Model S not capable of Supercharging certainly helped achieve that outcome.
This time around, getting out of delivering the margin-compressing base Model 3 will be somewhat more difficult. After all, when Musk first revealed the Model 3 he made it clear that the base version would not be something customers would regret ordering. "I want to emphasize," he said, "even if you buy no options at all, this will still be an amazing car... it's a really good car even with no options." Of course, that was also three years ago...