Cybertruck Affordability and Volume

[RVAC]

I'm talking short term, first year or two of volume production. Keep in mind that the EV market will still largely be supply limited, not chips but cells. That said long term I do agree, though we'll have to see what inflation has to say about that also.

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[Ogre]

I'm talking short term, first year or two of volume production. Keep in mind that the EV market will still largely be supply limited, not chips but cells. That said long term I do agree, though we'll have to see what inflation has to say about that also.

Tesla has hinted that they are not going to be cell limited. They are bringing on 100 GWH of capacity in Austin online. That’s more than enough for the Cybertruck and the Model Y.

 

[charliemagpie]

Hello! Anyone home? Did you forget that Musk was very noncommittal on the Cybertruck even starting production in 2023? Seriously if he had committed to 2023 on the earnings call that would have meant likely in 2024. More likely low volume sales starting 2024 or 2025.

Hello,
We shall see

I prefer Lager... Cold

 

[Crissa]

Hello,
We shall see

I prefer Lager... Cold

Gimme a Dr Pepper. No ice.

...Well, if it's summer, with crushed ice. Never cubed.

-Crissa

 

[RVAC]

Tesla has hinted that they are not going to be cell limited. They are bringing on 100 GWH of capacity in Austin online. That’s more than enough for the Cybertruck and the Model Y.

I was referring to the EV market at large, if other players are cell constrained it means that the unmet demand will go to those who can meet it and hence Tesla will be able to charge a premium for it.

That said in the Q4 call they did say that in 2023 they expect cells not chips to be once again the limiting factor.

 

[LDRHAWKE]

Aren’t we over looking in this discussion that over half of the Cybertrucks presently on order, nearly 600,000; over two years of production capacity, are already the $70,000 Tri-motor version. I would be surprised if many of those buyers would back out if it increased to $80,000 for the quad motor 4 wheel drive replacement.

 

[rr6013]

I’m afraid that making the Cybertruck the Techno King of pickups will come at a high cost. <SNIP> The initial Quad Motor MSRP will probably be in the $85-$95k range. A Quad Motor Plaid MSRP will be $110-$120k.

I predict that 10-20% of reservation holders will drop their pre-order once Tesla announces revised MSRP numbers for the 2023 Cybertruck.

The counter-argument I am proposing is EM has Tesla rollout of Cybertruck bass ackwards, launching QUAD CT most expensive 1st SOP.

Far better to rollout the SGL CT MVP(minimum viable product) SOP 1st. Strip goldplating, hold the alienware and keep the impulse engineering to a bare essential Cybertruck RWD pickup. Price it at Launch Party Pricing and include nothing but a SlimPicks like(wheels,tires and interior upgrades). Learn, optimize the production line, re-engineer problems, fix oversights and work the Omissions list.

Then move onto DUAL CT, TRI CT expanding options, adding upgrades and achieving full -scale production of the Cybertruck.

Then rollout QUAD CT in all its HALO Cybertruck Plaid pants glory! Tesla at that point should unabashedly offer Alien Variants of the Plaid approach $250,000 USD.

I see no rationale to limit Cybertruck upper bounds of variants to low six figures. Tesla leadership should deliver a real truck beyond imagination that ICE legacy OEM envision as a pickup.

Tesla have in Cybertruck a calibre of vehicle able to morph category and class from Pickup to SUV to TT(Tropphy Truck) that it can spec its design into by minimal optimization and modification. Variants are the long narrative arc of the Cybertruck story. Maybe legendary.

 

[rr6013]

Aren’t we over looking in this discussion that over half of the Cybertrucks presently on order, nearly 600,000; over two years of production capacity, are already the $70,000 Tri-motor version. I would be surprised if many of those buyers would back out if it increased to $80,000 for the quad motor 4 wheel drive replacement.

AND you’d be surprised!

 

[LDRHAWKE]

AND you’d be surprised!

You sound like a man with a single motor Cybertruck on order. The least profitable and lowest demand.

 

[rr6013]

You sound like a man with a single motor Cybertruck on order. The least profitable and lowest demand.

Oh wow!
A Tri-motor CT. It’s the best value for the price AND I need a Tow rig! That’s my RN.

Even if Tesla lose money on every SGL CT RWD sold, that’s the entry fee, marketing write-off and Trojan Horse cost to disrupt F-150 FORD pickup. Otherwise, WTF was Elon’s gauntlet “pull-off”?

SGL CT is Elon Musk’s OEM credibility pièce de résistance. Tesla will be lucky to have low demand to use the single motor CT as Trojan horse. It means something to stand behind your word. All buyers will note that EM was bs pricing Cybertruck at launch. Tesla goodwill, values and integrity are spent if Elon can’t deliver.

Single motor CT is the greatest EV pickup you can buy period AND if you need a truck-sized pickup SGL CT will last the longest. Yes, you might wait the longest if Tesla maximizes order flow profit over a SGL CT.

Dual motor CT is AWD best all-weather truck AND two is greater than one motor, electrically! Dual AWD is best, most popular daily driver.

Quad motor CT is 4x4 go-anywhere, anytime AND if more places is who you are, a Quad is for you! Quad is the Bees Knees CT. Tesla will make the most versions off its Quad CT recipe.

PLAID CT is the beyond ludicrous AND if you’re already there, PLAID is a perfectly fit. “Aliens can’t outrun Plaids”(That’ll make it into a movie script) Tesla’s roadster truck for those who gotta have one!

 

[JollyRoger]

I made a reservation because of the affordability. I stretched from 40k to 50k to get a bit more range. Elon says he's working on the affordability and some people go "yadda yadda - 89k at least". I obviously still expect an affordable dual motor for 50k. Have some faith friends.

 

[Ogre]

I made a reservation because of the affordability. I stretched from 40k to 50k to get a bit more range. Elon says he's working on the affordability and some people go "yadda yadda - 89k at least". I obviously still expect an affordable dual motor for 50k. Have some faith friends.

I’d go further.

It doesn’t take faith or trust or anything like that.

Simply put. No point worrying over that which you can’t control. No point drumming up fears over a bunch of presumption.

If Tesla raises prices I’ll worry about it when it happens. Until then it’s like looking for bugbears in your closet.

 

[anionic1]

This is another bit of the transcript which I think is widely mis-understood. Musk is talking about the challenges of the Cybertruck and he mentions that making it affordable is one of the biggest challenges. This answer also confirmed Musk‘s previous estimate about planned volume for the Cybertruck at 250,000 units.

We’ve all seen the crazy tech they are trying to cram into it, but fundamentally I think it sounds like Musk is trying to keep the truck grounded. The big reason? Because while he’s talking about affordability he’s putting it into context here.

“…if it's not affordable, that will constrain people's ability to buy it because they don't have the money… Aspirationally, we'd like it to go, in terms of just a rough order of magnitude, we'd like Cybertruck to be at least on the order of a quarter million vehicles a year. But it will take us a moment to get to that level.”​

So we need to work backwards from here. How much would the Cybertruck need to sell for in order to move 250,000 trucks a year after their initial backlog? That’s his **minimum** expectation and very likely the scale they will want and need in order to get the margins they are looking for.

Toyota has the “Premium” pickup and reputation for having crazy high truck prices, and prices on the Tundra range from about $35,000 to about $57,000 (likely around $75k with options). Across the whole Tundra line, Toyota only sells about 84,000 trucks per year. I think that sets a pretty good baseline for what the Cybertruck will cost.

The trucks which actually sell more than 250,000 units per year are significantly less expensive than the Tundra. There are no 250,000 unit/ year trucks which sell for $100,000, not even remotely close.

There is absolutely going to be a premium attached for the fact that it is an electric truck, but if they are going to hit that sales number, it is not going to be double the cost of otherwise comparable trucks.

Spoiler: Full text from transcript

Martin Viecha

Thank you. And the next question is, what are the biggest obstacles for Cybertruck volume production besides battery shortage?

Elon Musk -- Chief Executive Officer and Product Architect

Batteries will probably not be the limiting factor in Cybertruck production. There's a lot of new technology in the Cybertruck that will take some time to work through. And then, there's a question of like, what's the average cost of Cybertruck and to what degree is that affordable? You know, there's -- you can make something infinitely desirable, but if it's not affordable, that will constrain people's ability to buy it because they don't have the money .I worry more about like how do we the Cybertruck affordable despite having awesome technology. That's the thing that will really set the rate.

Aspirationally, we'd like it to go, in terms of just a rough order of magnitude, we'd like Cybertruck to be at least on the order of 40 quarter million vehicles a year. But it will take us a moment to get to that level.

This transcript is again from The Motley Fool. I made a slight edit to their transcription which is obvious in red above. I had to re-listen to the audio because I was pretty certain Musk didn’t say they were planning on making “40 million“ Cybertrucks a year.

People are probably around $45k-$50k average for a model 3 and $55k - $60k for a model y and they can’t make enough and they are in that 250k range. People expect to pay $20k for a truck for its capabilities. I can see them selling every one they can make for 10 years at $80k. Also the demand for trucks in the US is double the demand for cars.

 

[ijoe13]

Seems to me this is code from Elon for: what level of profit are we ok with for each CT? Based on initial reservations of 1M+, seems like there’s a question of how affordable to make it, how many types to have (plaid, dual motor, etc.) and how to make it priced attractive enough to eat into the ICE truck market while not canibalizing their own sales. If the CT is priced close to a Model YP, for ex., I’d imagine a lot of people would consider the CT (at least in N Amer.).
Overall, an interesting problem to have.

 

[chewchewchew]

This is another bit of the transcript which I think is widely mis-understood. Musk is talking about the challenges of the Cybertruck and he mentions that making it affordable is one of the biggest challenges. This answer also confirmed Musk‘s previous estimate about planned volume for the Cybertruck at 250,000 units.

We’ve all seen the crazy tech they are trying to cram into it, but fundamentally I think it sounds like Musk is trying to keep the truck grounded. The big reason? Because while he’s talking about affordability he’s putting it into context here.

“…if it's not affordable, that will constrain people's ability to buy it because they don't have the money… Aspirationally, we'd like it to go, in terms of just a rough order of magnitude, we'd like Cybertruck to be at least on the order of a quarter million vehicles a year. But it will take us a moment to get to that level.”​

So we need to work backwards from here. How much would the Cybertruck need to sell for in order to move 250,000 trucks a year after their initial backlog? That’s his **minimum** expectation and very likely the scale they will want and need in order to get the margins they are looking for.

Toyota has the “Premium” pickup and reputation for having crazy high truck prices, and prices on the Tundra range from about $35,000 to about $57,000 (likely around $75k with options). Across the whole Tundra line, Toyota only sells about 84,000 trucks per year. I think that sets a pretty good baseline for what the Cybertruck will cost.

The trucks which actually sell more than 250,000 units per year are significantly less expensive than the Tundra. There are no 250,000 unit/ year trucks which sell for $100,000, not even remotely close.

There is absolutely going to be a premium attached for the fact that it is an electric truck, but if they are going to hit that sales number, it is not going to be double the cost of otherwise comparable trucks.

Spoiler: Full text from transcript

Martin Viecha

Thank you. And the next question is, what are the biggest obstacles for Cybertruck volume production besides battery shortage?

Elon Musk -- Chief Executive Officer and Product Architect

Batteries will probably not be the limiting factor in Cybertruck production. There's a lot of new technology in the Cybertruck that will take some time to work through. And then, there's a question of like, what's the average cost of Cybertruck and to what degree is that affordable? You know, there's -- you can make something infinitely desirable, but if it's not affordable, that will constrain people's ability to buy it because they don't have the money .I worry more about like how do we the Cybertruck affordable despite having awesome technology. That's the thing that will really set the rate.

Aspirationally, we'd like it to go, in terms of just a rough order of magnitude, we'd like Cybertruck to be at least on the order of 40 quarter million vehicles a year. But it will take us a moment to get to that level.

This transcript is again from The Motley Fool. I made a slight edit to their transcription which is obvious in red above. I had to re-listen to the audio because I was pretty certain Musk didn’t say they were planning on making “40 million“ Cybertrucks a year.

I'm new to the channel: The price for my ordered CT was ~50K (dual motor). Now I don't see a price on my Tesla page. Does anyone know if Tesla will honor those original prices?

I'll be selling my Y to pay for it when it comes. If there is a $10k adder for the CT, then no problem. If it's a $20k bump, then I'm definitely on the fence. I'm not hauling cords of wood, this is a purely recreational (read that as my toy), so justification gets pretty hard when I'm in it for 20 large.

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