Tesla Motors Inc (TSLA) could be making progress on reducing the price of its vehicles even faster than management previously thought. The goal has been to cut the price of Tesla’s batteries low enough to be able to price the Gen III car at a starting price of around $35,000. PCMag reported this week that the base price of the Model X will be $55,000, a significant cut from the base price of the Model S, which is $62,400.
However, the website does not say where it got that price. That base price has garnered a lot of headlines on other sites, although it looks like that price was reported months ago by various sources. Tesla management said in February that the crossover vehicle would start out at a price similar to that of the Model S but did not give an exact number. Also CNN Money is still reporting that the vehicle’s price is unknown right now.
ValueWalk's Raul Panganiban interviews Kirk Du Plessis, Founder and CEO of Option Alpha, and discuss Option Alpha and his general approach to investing. Q1 2021 hedge fund letters, conferences and more The following is a computer generated transcript and may contain some errors. Interview with Option Alpha's Kirk Du Plessis
Tesla updates Model X progress
Tesla Motors Inc (NASDAQ:TSLA) sent emails to customers this week with updates about its progress on the Model X. the automaker said it plans to finish building the vehicle’s prototypes by the end of the year, reports CNN Money. The company also said it plans to begin production of the vehicle early next year. Previously, Tesla had said it would ramp up production of the Model X by next spring.
In the email, Tesla Motors Inc (NASDAQ:TSLA) added that they will still include the falcon-wing doors they introduced with the original idea for the Model X back in 2012. However, they said the third row of seats will be optional rather than standard. Some customers were disappointed with this, saying that it’s just another way to raise the vehicle’s price.
Tesla sees plenty of demand
Tesla Motors Inc (NASDAQ:TSLA) has been racking up orders for the Model X, surpassing $40 million. By the end of this past March, total deposits for both of Tesla’s vehicles—the Model S and the Model X—had hit $198 million. That’s a 21% increase from the end of 2013 and shows that there is still more than enough demand for Tesla’s vehicles. The automaker requires a $5,000 payment to reserve one of the vehicles and is now estimating that those who reserve now won’t receive their Model X until fall 2015.