
Ask HN: Why doesn't Tesla raise prices? - TekMol
Tesla has a hard time producing enough units to fulfill demand.<p>Tesla has a money problem.<p>Why not raise their prices?<p>Say they would raise the average price of Model 3 from $55k to $60k. How low would demand go? 75% of what it is now? 50%? And how would it impact the bottom line? I would assume it would look great. A probably super thin margin would turn into a solid 10% margin.<p>What am I missing?
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bufferoverflow
Musk's goal is to make affordable electric cars that would become popular
enough to make a dent in the carbon emissions. Money to him is just a tool.

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compcoffee
> _Money to him is just a tool._

Does any adult human actually believe this? The guy has a personal carbon
footprint bigger than 99.99999% of people on earth. He just negotiated the
biggest pay package ever, tied to market cap. He's being investigated by the
SEC for stock manipulation. But it's all because he loves the environment. The
mystique behind this guy is unfathomable.

Tesla doesn't raise prices because it would harm already waning demand for
their vehicles. The fact is, very few $60k+ sedans are sold around the globe,
and it's a competitive space. At that price range, people have high
expectations for luxury and build quality. The Model 3 gets points for being
technologically advanced, but many buyers in this price range aren't
interested in being beta-testers.

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bufferoverflow
His personal carbon footprint doesn't matter, because he is actively working
on reducing the emissions on a quite large scale.

Model 3 was supposed to be cheaper, $35K, but they are concentrating on
assembling the expensive versions first, which makes sense. They do need money
to build more production lines. Unless a comparable competitor shows up, he
will have customers for many years to come.

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dragonwriter
They are trying to raise the average price, e.g., by making two colors that
were base price options into premium add-ons.

They don't want to overtly raise the _base_ price because of the optics.

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anoncoward111
>What am I missing?

Demand is already falling at 35k levels according to whatever articles you
read out there

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TekMol
'falling' without actual numbers could mean anything.

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anoncoward111
I would have to go searching for the news articles that trickle out over the
months but people are alleging that customers are canceling their orders and
the company is trying to dump inventory elsewhere.

It's really hard to quantify this stuff. We only have audited numbers about
units built not units sold, currently.

