Tesla Offers New Car Buying Experience
Writer / Bethann Buddenbaum
Tesla Motors is winning over car enthusiasts worldwide. Their success comes despite attempts by detractors to discredit the company’s viability in an oil-driven economy. Wall Street analysts frequently reevaluate the company’s future. And, if they are to be believed, Tesla Motors is doomed every time the price of filling your tank drops below $4.
Yet, Tesla Motors continues to add stores, service centers and charging stations in cities across the globe. The company remains a shining example that American entrepreneurism and ingenuity are alive and well. Year over year, Tesla increases both its production and its profit. Analysts, who expected Tesla to post a loss in the third quarter of 2014, were surprised when the company recently announced a profit of two cents a share. Sales of the Model S began modestly with a figure of 2,650 vehicles sold in North America in 2012. By 2013, global Tesla sales reached over 25,000 units. And, although sales estimates were reduced, Tesla had already reached global cumulative sales of 46,948 by September 2014.
Tesla’s stellar track record in safety and performance certainly adds to its appeal. Just last month, the Model S received a 5-Star safety rating from the Euro NCAP. This makes Tesla one of the few vehicles ever to receive a 5-Star rating both from Euro NCAP and the U.S. National Highway Traffic and Safety Administration (NHTSA). The Model S became the first electric vehicle to win “Motor Trend’s” Car of the Year award in November 2012. In May of this year, “Consumer Reports” gave the Model S its highest car rating ever — 99 out of 100.
Here in Indiana, Hoosiers have given Tesla Motors a warm reception. The company opened its Indianapolis location last December at The Fashion Mall at Keystone at the Crossing. The Tesla store sits on the perimeter of the food court. Its open, gallery-like setting is visually inviting, and the sleek Model S vehicles just inside of the entry make people stop in their tracks. And now 200 Hoosiers are Tesla owners.
The only way that customers can see or test drive a Tesla vehicle is by stopping into a local store, which is typically located in a shopping mall. Unlike the major auto manufacturers, Tesla Motors maintains full control over its vehicles from the drawing board to your door.
“It takes a lot more touch points and knowledge to sell our vehicles,” said Tesla communications manager Will Nicholas, explaining why the company chooses to control the sale of its vehicles rather than turn it over to a third-party dealership.
This choice has caused Tesla some trouble in states such as Texas, Arizona, Michigan and New Jersey. Legislators in these states have blocked the company from opening shop specifically because they do not involve a dealer in the sales process. Indiana had no such hesitation in welcoming Tesla, as the Fashion Mall location was Tesla’s first Midwest store.
Visitors to Tesla’s store will find a buying experience that is completely different from a traditional car purchase. Demonstration Model S vehicles are parked in the showroom. Test drives are available. But, you will have to wait three to four months for the car to show up in your driveway. Each car is made to order in Tesla’s Fremont, California manufacturing plant, which churns out an average of 2,000 vehicles per month. Customers purchasing a new Tesla have one model from which to choose. Everything else is all about the options.
The average selling price of a Tesla Model S in North America is in the $90,000 range (including a $7,500 federal tax incentive for EV purchases). This figure is comprised of the $69,900 base price plus customization. The most popular upgrade is to the 85 kWh battery vehicle, which provides a range of 230 miles; an equivalent of 88 mpg in the city and 90 mpg on the highway. If your Tesla is used primarily as a commuter car and to get you around town during the week, it’s likely that you don’t need the extended battery life. But it’s tough to let go of the fear of being stranded on the roadside standing beside an electric vehicle with a gas can in hand.
Hoosier drivers will want to consider the Subzero Weather option package. This package contains everything that you need to make cold weather driving tolerable: a heated steering wheel, heated rear seats, a windscreen wiper de-icer, and heated wiper nozzels.
The Tesla pricing structure is very simple. Whether you walk into a store in Indianapolis, Los Angeles or Miami, it’s all the same price and customer experience. The only difference that customers will pay from location to location is registration and taxes. You won’t get the hard sell on option packages, either. Tesla does not incentivize upsizing with its sales staff, so their primary concern is getting you in a vehicle that fits your needs and budget.
Look for the P85D, Tesla’s latest Model S version, to arrive in stores this month. This all-wheel drive vehicle is the world’s first dual electric motor production car. Each axle on the P85D has its own dedicated motor, which acts independently and controls torque to the front and rear wheels. What this means for drivers is unparalleled traction control and 0 – 60 in 3.2 seconds, which makes the Model S P85D the fastest four-door car in the world.
The launch of P85D also introduces Tesla’s new Autopilot feature. Besides warning drivers when they exceed the prevailing speed limit, once the signal is turned on and the car deems it safe to do so, Autopilot will change lanes for the driver. These are just early capabilities for the hardware. Adaptive cruise control will be added before the close of 2014 and self-parking is slated for addition next year.
These are the last major feature updates expected between now and the release of Tesla’s more affordable crossover vehicle, the Model X, in 2017.