Elon Musk replies to a Tweet about Pricing on the Cybertruck

[charliemagpie]

Did Rivian set its prices before or after the CT reveal.

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[Ogre]

Rivian had little to no chance to be ahead.

Tesla made an EV when there were none. They had to bodge together a bunch of things not intended for vehicles to make it work. There was no EV market, no competition save oblivion, and little technology to support their plan. Any competitors to Tesla would have to go down the same long hard road Tesla did to release a product.

Rivian used a pile of existing off-the shelf tech, including battery tech partly designed by Tesla, and assembled it into a truck. I’m not suggesting this was a trivial effort, but what they did could be and **WAS** duplicated fairly quickly. Where Tesla released into a vacuum, Rivian is struggling to have a voice with 3 strong well financed players fighting them for mind-share.

Yes there are parallels, but its not that similar.

 

[Ogre]

Did Rivian set its prices before or after the CT reveal.

Apparently Rivian set their prices a bit higher then dropped them a bit after Cybertruck launch.

https://electrek.co/2020/01/26/rivian-base-price-lower-than-69000-cybertruck-effect/

 

[Dusty]

It's crazy to think of how good Rivian is, but how far behind they are. They should have ONLY made the R1T with one trim (top) with the plan of it sharing 80% of its components with the R1S. None of the things like the speaker, security rope, and flashlight--that stuff could be in a gear catalog. Show it off rocking chunky 33" M/Ts and getting dirty everywhere. Then concentrate on one factory cranking out the R1T with the R1S coming out 4-5 years later when production was ramped/stable after you've built a cult following.

Price it at $80k, sit back, and watch it cut deep into Rubicon, Bronco, and Land Rover sales.

Hindsight, something something something...

 

[Ogre]

It's crazy to think of how good Rivian is, but how far behind they are. They should have ONLY made the R1T with one trim (top) with the plan of it sharing 80% of its components with the R1S. None of the things like the speaker, security rope, and flashlight--that stuff could be in a gear catalog. Show it off rocking chunky 33" M/Ts and getting dirty everywhere. Then concentrate on one factory cranking out the R1T with the R1S coming out 4-5 years later when production was ramped/stable after you've built a cult following.

Price it at $80k, sit back, and watch it cut deep into Rubicon, Bronco, and Land Rover sales.

Hindsight, something something something...

A company which is just selling a 90,000+ truck at low volume can’t demand an $80b market cap when it goes public.

As soon as you let venture capital get control, the clock is ticking. They want return on that money. Doesn’t matter if it’s not a long term viable plan so long as VCs can cash out.

 

[Crissa]

It's crazy to think of how good Rivian is, but how far behind they are. They should have ONLY made the R1T with one trim (top) with the plan of it sharing 80% of its components with the R1S. None of the things like the speaker, security rope, and flashlight--that stuff could be in a gear catalog. Show it off rocking chunky 33" M/Ts and getting dirty everywhere. Then concentrate on one factory cranking out the R1T with the R1S coming out 4-5 years later when production was ramped/stable after you've built a cult following.

Price it at $80k, sit back, and watch it cut deep into Rubicon, Bronco, and Land Rover sales.

Hindsight, something something something...

That sort of stuff is how Tesla made its money - overprice the fancy options because those are the people most likely to spring for the Supreme flashlight or whatever.

-Crissa

 

[Dirt Worker]

As a diehard no spark ICE fan. He had me at 7 ton tow.

 

[Clustertruck]

Tesla's primary challenge is they're not ready to build the Cybertruck after the same number of years as Rivian has had to start from scratch.
The Rivian pickup and SUV are cheaper than the Model X … so Tesla definitely has the problem of affordability.
I think Tesla's biggest problem is initial quality, reliability and the ownership experience especially in terms of service and support.

 

[Ogre]

Tesla's primary challenge is they're not ready to build the Cybertruck after the same number of years as Rivian has had to start from scratch.
The Rivian pickup and SUV are cheaper than the Model X … so Tesla definitely has the problem of affordability.
I think Tesla's biggest problem is initial quality, reliability and the ownership experience especially in terms of service and support.

If you believe Tesla’s management, their big challenge is they can’t get enough supplies (microchips and other bits) to start a new product line.

They have no incentive to be ready to build the Cybertruck until they resolve these parts shortages.

 

[xodarap1]

Why is it easy to imagine Tesla reneging on prices when they've never done that in their history?

-Crissa

It might be a great move for them to sell the first few runs just 2k or 3k over cost. That would leave just the limited market of more expensive EV trucks that still won't be able to match most of the features and tech and any price point. Some things are worth doing, even if it doesn't make initial $ense.

 

[Crissa]

The Rivian pickup and SUV are cheaper than the Model X … so Tesla definitely has the problem of affordability.

The Model X isn't supposed to be affordable. Neither is the Roadster or Model S Plaid. They're technology platforms to do something cool and learn how to maintatain these technologies... so they can be ported to the lower models.

-Crissa

 

[rr6013]

It might be a great move for them to sell the first few runs just 2k or 3k over cost. That would leave just the limited market of more expensive EV trucks that still won't be able to match most of the features and tech and any price point. Some things are worth doing, even if it doesn't make initial $ense.

To your point taking a 2k or 3k over cost == great

That assertion is hollow by the fact that GigaFactory was engineered, built and designed to provide economy of scale manufacture of EV’s.

Should Tesla “cost” require $2k or 3k USD above and beyond its own projected pricing = failure. Its a testament to Tesla design fail, engineering, fail and critically prima facia evidence that GigaFactory completelyfailed to enable the economy for which it was built.

Elon Musk wears the ”fail” around his neck as earned credibility everytime he must issue a proclamation. OEM’s must take Tesla’s own hubris fail as their lesson that BEV is beyond mere mortal affordability.

Most importantly, Nation state actions must read the the failure of the industry leading manufacture fail as proof that government assistance, subsidy and technology can’t bring the EV within reach of the people who need to replace ICE cars now.

IF every step, technology and blank slate effort such that Tesla provided Cybertruck cannot enable the transition to EV’s then it truly is a hit the TSLA, BEV industry and tech sector future leadership if it can’t produce affordable products needed to stop CO2 emissions.

 

[Clustertruck]

The Model X isn't supposed to be affordable. Neither is the Roadster or Model S Plaid. They're technology platforms to do something cool and learn how to maintatain these technologies... so they can be ported to the lower models.

-Crissa

Except it's the other way around – the R&D has gone into the Y. The S (and 3 and X) receive upgrades as parts from the Y. The S Plaid uses Y hardware. The Roadster II doesn't exist; nor does the Cybertruck for that matter.
In terms of product line-up, the Rivian R1T is the competitor to the Cybertruck and the Rivian R1S is the competitor to the Model X. The Rivian vehicles have better prices (even after the 20% price increase, they were equal.)
I expect Tesla will not leave a dollar on the table and start with the Cybertruck priced around the Model X with a 2 or 3 year plan to release lower priced models.

 

[Ogre]

Except it's the other way around – the R&D has gone into the Y. The S (and 3 and X) receive upgrades as parts from the Y. The S Plaid uses Y hardware. The Roadster II doesn't exist; nor does the Cybertruck for that matter.
In terms of product line-up, the Rivian R1T is the competitor to the Cybertruck and the Rivian R1S is the competitor to the Model X. The Rivian vehicles have better prices (even after the 20% price increase, they were equal.)

The R1T was out when Tesla launched the Cybertruck. It had a base price at $69k.

Guess where the Cybertruck’s top end ended up?

That tells an awful lot about where Tesla thinks the Cybertruck belongs in the market.

Rivian is a high end niche truck Tesla is pitching their top end Cybertruck against it.
The base Cybertruck is their F-150 mid market truck.

I expect Tesla will not leave a dollar on the table and start with the Cybertruck priced around the Model X with a 2 or 3 year plan to release lower priced models.

Musk has always pushed the Cybertruck as being an affordable truck. A $100k+ price tag doesn’t mesh with that at all. Maybe with options piled on.

 

[empiredown]

I'm jumping back in here. At our collective peril...

Affordability is relative, just like everything else in the universe. Every single manufacturer that sells something plays this balance with what they can charge and what they can get. 100k for a truck is ludicrous for me. But people here in Texas don't bat an eye at spending that it seems. There are 100k trucks all over the place... I don't doubt there are several other American/Canadian markets/locales that also rings true in. Other than some Gulf States I've been in, I am sure that is not the case elsewhere... basically every elsewhere. Musk also gets relativity. I don't think I would continue to pin my hopes on a 49k CT to that at this point.

Musk and his crew knew several years ago that Rivian and other competitors were going in too low. His current comments portray that. It being difficult for Tesla = impossibility for others. I do not doubt their initial plan for production and delivery was possibly valid, but times change. As do prices and costs. As does using your competition's misfortunes for your own benefit. But the recent earnings call announcements of changes/delays AFTER Rivian began to launch, knowing what Tesla HAVE to know, is fascinating... and we still see very little in apparent forward progress on the CT, we're about done with the first Quarter here and they want to start producing/delivering by the Fourth? I am betting , literally, that they are going to delay and let things play even further out while they let the competition fail, supplies to hopefully begin to flow like Spice. That also gives more of an air gap to make price increases more palatable...

I get the whole economy of scale thing. But you actually have to have scale for this to work. Five years from now when the Giga is humming along like a symphony and there is a new normal? Sure. A year from now? I find that unlikely for the CT... Even with all the R&D and tech they have stollen from from within and without. And my guess is just as valid as yours absent some concrete proof of forward progress.

Fair warning: No Marxist rants or virtue signalling after this please. We don't need to hear about the plight of the Workers (insert a Techno version of The International here) vs the Man, everyone's favorite "socialist" in his cute scarf and mittens (oh if only he HAD hitched a ride in the Roadster) as he wags his finger at a company for doing what companies do, and protestations of how inclusive you are unless of course it pertains to something you don't agree with (deeds, not words). And that was deeds, not Dids...

Kiss kiss, y'all...

SS

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