Tesla Model S P100D Red

Tesla Model S $30K Price Drop? No, Tesla Doesn’t do Deals

A recent email from a Tesla dealer caught the attention of the Tesla Motors Club. A very interesting and unusual sentence was in this email “We are offering showroom incentives up to $30,000 off the original configuration price.” This phrase is not one Tesla themselves say often, and with a standard list no lower than $75,000 did the Model S and Model X just drop in price, if so why now?

Recent data suggests that Tesla is struggling to move current Model S and X inventory due to the excitement over the Model 3. Being that Tesla is a very forward-thinking company they are likely worried that investors will see the dip in sales and grow anxious. But who can blame consumers? All reviews and reports show that the new Model 3 is all the luxury of the current high price Tesla models, without the high price.

Tesla needs a boost?

I can easily see a case for offering a better price than normal to close out the third quarter strong since the delivery numbers on the new Model 3 are not likely to exceed 500 units. Most sales will come from current dealer inventory for the remainder of the quarter. It may also be that this specific dealer, the email was not from Tesla directly, was falling short on sales quotas or needed to move inventory off the lot. An odd scenario, but one that may have played out well for consumers.

Well, not so fast, a spokesperson for Tesla squashed any hopes of these deals with his comment on . Telling those speculating that the email and deals are unauthorized and inaccurate. Tesla doesn’t do deals, saying, no Tesla customer ever has to be concerned with getting a good deal. And clearing up that the dealership was referring to the price adjustment on vehicles that are used, or service loaner, or have been repaired.

No deal?

Tesla’s business model doesn’t allow for deals, a position they’ve made clear a few times. This to me is the essence of Tesla. They have the same kind of negotiation strategy that America does with terrorists, we don’t. That’s to say when you buy a Tesla you’re buying it because you want the best. I agree with Tesla on this philosophy, it is better for consumer and producer not to negotiate, because in the end someone wins and someone loses if there are negotiations. Without them I think the customer and the company get to win.

For all it’s worth Tesla’s business model seems to be working out for them, they may be struggling to turn a profit but investors continue to reward Musk and sales have remained strong. I wouldn’t be surprised if Tesla were to start offering lower pricing on current inventory Model S and X due to the nature of what their trying to accomplish with the Model 3. A million units produced annually and at a price point lower than Tesla has ever been before. Musk’s ambition may completely reorient the company from a luxury brand to an everyday brand know for quality and reliability. The Model S and X may be less popular with consumers after if the Model 3 keeps on its current course.

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