Tesla Model X to be $52,000 cheaper than the headlines might lead you to believe

Tesla Model X
© Tesla

Tesla's strategy has always been to start up-market, and then go down over time. This allows them to use more expensive products to finance the creation of cheaper ones (it costs a lot to develop new models, set up factories, build a Gigafactory to reduce battery costs, etc). They're doing this with their EV models (Roadster to Model S/X to Model 3), but they are apparently also doing this within the Model X launch. They no doubt knew that production would take a while to ramp up and at first supply would be lower than demand, so they started with the top-of-the-line Model X, the P90D (Signature edition with dual 'Performance' motors and all options), and will release other models later.

Update: Did Elon Musk reveal the existence of a Model Y with Falcon Wing doors on Twitter? (he later deleted the tweet)

That's quite an expensive package, with a price tag of $132,000! Elon Musk has mentioned during the launch that there would be other models later, and has said on Twitter that pricing for the Model X would be about $5k more than a similarly equipped Model S because of the larger size and increased complexity (those doors!):

Unfortunately, the media seemed to stop at the initial price tag and assume that this is the base price for a Model X. For example, here's Bloomberg:

Bloomberg Tesla Model X headlineBloomberg/Screen capture

[Model X] has a price tag as shocking (to your wallet) as those doors: The Signature Model X that Musk introduced, loaded with extra features, required a $40,000 deposit and comes with a $132,000 price tag, plus delivery and other fees. (Tesla has yet to announce what financing options will come along with its new ride.)

That’s a lot of money—nearly twice the cost of the base Model S sedan—and considerably more expensive than the comparable-in-size Porsche Cayenne S E-Hybrid, which costs $77,200.

A lot of newspaper headlines and TV segments similarly focused on the price of the fully loaded model, and many didn't mention that cheaper ones were coming, or they buried it in the story (at least Bloomberg mentioned it, but not everybody did). This is no doubt creating the perception in a lot of people's mind (especially those who just pay attention to this stuff once in a while when there's a big news item like this) that the Model X will cost $132,000.

In fact, if we take Musk to his word, a 70kWh Model X with dual motors could start at $80,000. After the $7,500 federal incentive, that's $72,500. Still expensive, but $52,000 less than the headline number! That's not a small difference. And if they make a single-motor version of the Model X (something I'm not sure about), you can remove another $5,000 from that price tag, for a $57,000 difference with the P90D version.

Tesla estimate fuel savings of about $10,000 over 5 years compared to a gasoline vehicle, so actual price of ownership over 5 years could be $62,500 (minus any state or local incentive). We're now getting into a price range that a lot of people can afford (maybe not me and you, but I see lots of luxury cars and SUVs driving around that cost in that range).

Tesla Model X© Tesla

Via Elon Musk, TMF

Tags: Electric Cars | Electric Vehicles


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