Is there only one interesting Tesla in the catalog?

The exclusion of the Tesla Model Y Long Range RWD from any form of promotion reinforces the idea that it is the only one that matters.

Not a month goes by without Tesla finding a new trick to keep the excitement for its Model Y alive. Competition has intensified in the electric segment, prices are dropping, and valid arguments are worth gold.

The most effective argument remains, of course, the price, but it’s a dangerous game. Cutting prices too much threatens profitability, and Tesla was already penalized by financial markets on this topic in early summer 2024. The problem is relatively simple to explain: Tesla experienced extremely rapid growth coming out of Covid, riding on society’s desire to transition to electric to protect the planet from CO2 emissions.

However, this growth raises questions, particularly about the American automaker’s ability to maintain this trajectory long-term. Tesla quickly expanded its production with new Gigafactories in China, Germany, and Texas, dramatically increasing its capacity to produce vehicles at scale. However, this rapid expansion has put its supply chain to the test, especially due to reliance on critical raw materials like lithium and cobalt, as well as electronic components, such as chips, which have been affected by global shortages.

Too big too fast?

Tesla’s rapid growth has also been accompanied by frequent complaints regarding the manufacturing quality of certain vehicles. Recurring issues with components such as body panels, sensors, or assembly have been reported. Tesla’s after-sales service has also been criticized for its inability to handle an increasing volume of repairs and complaints.

After an initial leasing cycle, the vast majority of Tesla’s global sales (buying an electric car makes no sense, as Mobiwisy keeps repeating due to the ongoing tech boom), the stock of used cars continues to grow, and early dissatisfied customers are turning back to traditional competition. At the same time, global demand for electric cars is stagnating, and more and more players are entering the market. As a result, the slices of the pie are getting thinner and the margins are getting smaller. The consumer benefits… but not the planet.

To counter this phenomenon, Tesla is increasingly resorting to promotions. Gone is the blessed time when Elon Musk ridiculed legacy automakers for their discount-focused sales practices. Tesla is now fully immersed in this and has become, even faster than anticipated, just another mainstream manufacturer. This reality must hurt Musk’s self-esteem, as he is a brilliant, divisive, and pragmatic figure. Such is life for Tesla in 2024.

Price Instability

The incessant price fluctuations and promotions from Tesla frustrate customers. A recent example: Mobiwisy anticipated the announcement of the new prices for the Model Y in France by 24 hours. There was an avalanche of calls to dealerships for information and negotiations to apply the new prices and financing mechanisms in advance, under the threat of canceled sales. So much so that we preferred to modify the article at the manufacturer’s request to put out the fire.

It is now common knowledge that Tesla adjusts its prices, particularly at the end of quarters to boost sales figures. This creates uncertainty for consumers, who sometimes hesitate to buy, hoping for a future discount. The impact is also fatal on the residual value of used cars. Some customers have lost up to €10,000 in value on their vehicle in just a few weeks.

The Model Y Long Range RWD as the Savior?

Amid this promotional chaos, only one car is spared across the entire range: the Model Y Long Range RWD, released in spring. Priced at €42,990, bonus included, in September 2024, it was only €2,000 more than the RWD version at its launch.

Faced with the cannibalization of this model, Tesla is forced to artificially create space… at its own expense. To do this, Tesla is discounting its RWD to €36,990, but only for vehicles in stock. The problem is that everyone is waiting for a condition, and nothing is moving.

However, the signal sent is very bad. In the United States, the RWD version has literally disappeared. In China, Tesla is questioning whether to introduce the Long Range RWD, keeping it in reserve in case sales collapse. What about its ability to produce enough batteries of the new capacity?

In trying to please everyone, Tesla mainly risks pleasing no one. And we are not even discussing Musk’s poor communication conduct, which drives buyers away, especially in the United States.

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