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Former GM vice chairman Bob Lutz says Tesla will go out of business by 2019

Automotive industry veteran Bob Lutz has once again spoken out against Tesla. Known as one of Tesla Motors’ greatest skeptics, Lutz had stated two years ago that the Silicon Valley carmaker is doomed. Now, Lutz is saying flat out that Tesla is going out of business and won’t even get to 2019 at this rate.

In an interview with the show “Power Lunch” at CNBC, Lutz cited a number of issues or reasons why Tesla would not be able to last long in the automotive industry. The electric carmaker has been facing these issues for quite some time, and some of these have been known to the public.

According to Lutz, Tesla is burning its cash fast, no thanks to fixed costs that are now out of control. In fact, Tesla is also spending around $1 billion a quarter, which is at par with what GM spends. However, there is a big difference in the number of vehicles and models that the two carmakers are selling. For instance, Tesla is effectively selling just three models while GM has dozens on its lineup. While GM is raking profits, Tesla posted $619 million in losses in the third quarter of 2017 while managing to build just 260 examples of the Model 3.

Read the entire article Former GM vice chairman Bob Lutz says Tesla will go out of business by 2019

Investment analyst foresees Tesla Model 3 market domination over BMW 3 Series

Social Capital CEO Chamath Palihapitiya has presumed the entire (BMW 3 Series) business will “go to zero” judging by the number of pre-orders made for Tesla Model 3. Appearing on CNBC’s Fast Money Half Time Report, Palihapitiya claims that orders for the 3 Series are already being hit significantly by Tesla’s more affordable EV, adding that people do not know anything about the level of demand surrounding the popular Tesla Model. Adam Jones of Morgan Stanley has opposed the claim, citing both political and international contexts to the businesses.

Palihapitiya is a former member of Facebook’s senior executive team and has just attended the 2017 Delivering Alpha conference in New York last September 12. Earlier this week, the investment analyst pointed out there is not one person in his right mind who would choose BMW 3 Series over Tesla.

Despite this, BMW i3 has received a makeover in the hopes of competing with Tesla’s long ranging, lower priced sedan. The revamped i3 will be featuring a host of optional driver assistance technologies including adaptive cruise control though we know it won’t make the range any better. Like before, the i3 can only run up to 160 kilometers per charge plus it comes with an extended range of about 290 km. In contrast, the Tesla Model 3 boasts a range that goes somewhere between 350km and 500km.

Read the entire article Investment analyst foresees Tesla Model 3 market domination over BMW 3 Series

Tesla has been granted dealership license in Arizona to sell its vehicles

After a number of failed attempts, Tesla finally gets an Arizona dealership license by winning a court battle that allows them to sell directly to consumers. The automotive dealer license is a standard license traditional automotive dealerships are required to hold in order to sell vehicles.

Late last year, the DMV issued a dealer license to Tesla, which had only been approved last week after a Maricopa County administrative law judge confirmed that the process for blocking such a license from the Arizona Department of Transportation did not apply to Tesla in the first place.

After claiming the license, the electric automaker will now be able to conduct test drives and sell vehicles out of their service centers and the gallery they are currently operating in Phoenix.

Read the entire article Tesla has been granted dealership license in Arizona to sell its vehicles

Tesla says its Model 3 reservations are on the rise

Notwithstanding Tesla’s effortless marketing and anti-selling initiatives, its CEO, Elon Musk has finally announced that paid reservations for the Tesla Model 3 continue to go up every week. After commencing the reservation procedures barely a month ago, the CEO once shared that the company has already taken about 400,000 pre-order reservations. Since discussing these numbers however, Musk no longer wants to share the exact figures. He explained that if he does this, many people will speculate or make wrong assumptions on what’s going to happen next.

In the recent 1st quarter earnings call, Musk neither answered directly nor tried to eschew the inquiry. Instead, he replied by saying that although he’s not willing to share the actual number, the reservations continue to climb on a weekly basis. That is, in spite of their attempts to encourage their customers to buy the Model S instead of the Model 3.

When asked to provide the exact number of reservations, the CEO said that the problem lies in the probability that people will run off and make all kinds of conclusions based on the number and he thinks that this isn’t “predictive” of the future. He also mentioned that these people aren’t even allowed to test-drive a Model 3 and that the company doesn’t do a thing to sell the Model 3 but increasingly more reservations are made every week.

Read the entire article Tesla says its Model 3 reservations are on the rise

Investors don’t seem to mind that Tesla Motors failed to achieve its delivery targets for the full year 2016. It seems that their optimism for Tesla’s growth is still very high despite the failed target achievement, simply because deliveries in 2016 are still much higher than the figure a year ago.

In press release published on January 3, 2017, Tesla said it produced a total of 83,922 vehicles in the full year 2016, or around 64-percent more than the California-based carmaker manufactured in 2015. Of these, 76,230 vehicles have been delivered to its new owners, which means that these units were promptly delivered to customers with no issue on paperwork.

Tesla doesn’t count ordered vehicles as delivered units. This delivery figure is short of the delivery prediction made in February 2016, when Tesla said that it aimed to deliver between 80,000 and 90,000 vehicles for the full year 2016. Tesla had adjusted this predicted figure to 79,000 units, but still failed to achieve the adjusted delivery target.

Read the entire article Investors still hopeful for Tesla despite the failed target achievement in 2016

If you live somewhere in Missouri and you’re looking forward to buy a new Tesla Model S, chances are you might not be able to purchase one within the state soon.

No, Tesla is not shutting down and is very much operational in the United States. The California-based carmaker still has the full ability to manufacture, as well as market and sell its electric vehicles. However, it couldn’t sell its vehicles in any place within Missouri, simply because the state and the court have said so.

Actually, Tesla had a license to sell new vehicles in the state. However, such license has to be renewed yearly, and the latest one was only good until 2016. An application to renew the license for 2017 had been rejected, thus leaving Tesla no legal permit to sell new vehicles in Missouri. So simply and generally, Tesla is not anymore allowed to sell its new vehicles in the state.

Read the entire article Tesla sales in Missouri hit brakes in 2017 as state refuses to renew dealer licenses

In the recent months following Tesla’s announcement of its newest EV, the Model 3, the automaker has received hundreds of thousands of reservations. For only $1,000, customers are able to secure for themselves one unit of Tesla’s most affordable car. The Model 3 can cruise 215 miles in a single charge and can sprint from 0 to 60 mph in less than 6 seconds. It has by far achieved high ratings in every safety category and it is also equipped with an autopilot option. The Model 3 is due for production and will be delivered to its owners by 2017.

What makes the Model 3 the best choice for those who are looking for a more environment friendly alternative is that it doesn’t cost as much as the other Tesla EV models. The Model 3 is the most affordable choice among Tesla’s hoard of EVs at only $35,000 compared to the other models which cost almost twice its base price. Apparently, the Model 3 is just the way to go for those who want the best but at a reasonable price.

But it seems like Tesla’s decided on making a new offer just before the Model 3 hits production (and distribution). It’s quite confusing for some of us but there are reports that Tesla is currently convincing Model 3 reservation holders to change their minds and consider the Model S base model instead. Wait, what?

Read the entire article Tesla attempts to convince prospective Model 3 buyers to switch to Model S instead

Tesla’s upcoming Model 3 has been stirring up the news for the past few days since its debut last week. In just 24 hours, almost 115,000 orders were secured and are now estimated to have reached over 325,000 reservations. People were falling all over themselves to place a $1,000 refundable reservation fee for this upcoming electric car that is estimated to be sold at $35,000 minus the government taxes.

The Model 3 is expected to be one of the best electric cars that were ever made. The Model 3 is expected to have a five-star crash rating in every category. Not much information on the Model 3 has been released except for a few hints given out by Tesla CEO Elon Musk. What we currently know of is that the Model 3 will come with a standard autopilot safety feature including emergency braking collision avoidance.

It is also expected to speed up from 0 to 60 mph in 6.0 seconds. The base version will have an EPA rated range of at least 215 miles per charge and is rumoured to have an 80 kWh battery pack capable of a no-charge 5-hour 364-mile drive. The car’s exterior is legit Tesla but its frontal angles look a bit like a Porsche Panamera; the Model 3 looks like a crossbreed between a Model S and a Model X roofline.

Read the entire article Craigslist ads hint at huge payoff for those ‘investing’ in Tesla Model 3

Tesla Motors is considering a plan to sell more stock as one of its options to raise additional capital, according to CEO Elon Musk. Last quarter, Tesla lost $359 million in cash during a strong period for luxury vehicles. For every Model S electric sedan sold, the automaker loses over $4,000.

Last Wednesday, Tesla reduced its production goals for 2015 and 2016. Since the company went public in 2010, Musk’s investors have been taken on an exciting albeit unpredictable ride. However, Musk has imposed a deadline on himself, pledging that by the first quarter of next year, the automaker will have sufficient money to make the transition from building one costly, low-volume car to having a mass production of many models.

He also aims to expand a venture to produce electric power storage systems. Last Thursday, Tesla’s shares decreased by nearly 9%. On Friday, it slipped 2% further as analysts and investors considered the risks of his lofty plans for growing the auto and energy storage segments.

Read the entire article Tesla reported $359 million losses in Q2, may sell more stock

Tesla Motors Inc. will offer a $1,000 discount for both the referrer and buyer of the Model S sedan. This discount program, which will take effect through the end of October, will test how reliable viral marketing is in selling its electric cars.

This discount program will start as the automaker is preparing an assembly line for its new Model X crossover, also suggesting a wish to sustain the sales momentum for the Model S.

The automaker has established a delivery target of 55,000 units combined of the Model S and Model X in 2015. Tesla CEO Elon Musk characterized described the referral program as a test of an approach that could eventually eliminate the cost of setting up retail stores throughout the country. He shared that presently, Tesla spends around $2,000 to sell a car at one of its showrooms.

Read the entire article Tesla offers $1,000 referral discounts for Model S purchases

Texas may become home to up 12 Tesla stores selling cars directly to customers. This comes as state Reps. Eddie Rodriguez, Charles Anderson, Jodie Laubenberg, Tan Parker and Rod Simmons and Sen. Kelly Hancock recently filed bills that would enable Tesla implement its direct sales model in the state.

Under current state law, new vehicles could only be purchased via a franchised dealership. The bills -- House Bill 1653/Senate Bill 639 -- proposed that a carmaker or distributor may be considered a dealer if they does not own or operate over 12 dealers or dealership locations in Texas, and if they have yet to sell any vehicle via independent franchised new-vehicle dealerships in the state.

As expected, the bills are being opposed by dealers, according to Bill Wolters, president of the Texas Automobile Dealers Association. Texas has 1,257 franchised new-vehicle dealerships, and a number of them are already contacting members of the Texas House and Senate to air their concerns, he said.

Read the entire article Texas bills may allow Tesla to open up to 12 stores

A bill that disallows direct sales of vehicles in Michigan has been signed into law, effectively closing the doors for Tesla Motors to sell without going through dealers. The signing of the bill marks another loss for the electric carmaker, which has been experiencing some wins and some defeats in different states in its bod to sell directly to consumers.

The state’s governor, Rick Snyder, received some flak for signing the bill -- especially that he was once connected with a PC maker that sells directly to consumers. Since he is up for reelection this fall, Snyder could not help but take some hits on his decision to sign the bill.

One of those who blasted Snyder was Detroit billionaire Dan Gilbert, founder and chairman of Quicken Loans. He remarked that if one has a philosophy, he needs to adhere to it and not net personal circumstances compromise it.

Read the entire article Michigan governor hit for signing bill barring Tesla’s direct auto sales

According to the latest reports, Tesla Motors is now developing a program to sell second-hand Model S vehicles. Apparently, there are some good reasons for doing this: drop the cost of the $71,000 electric sedan and developing a certified pre-owned program in order to better compete with similar-sized models offered BMW or Mercedes-Benz.

For those who don’t know, back in 2013 Elon Musk a.k.a. company’s CEO reassured customers about the guaranteed resale value of the Model S. Buyers who financed a Model S are able to return the car after three years and still recover between 43 to 50 percent of its original price tag. Musk said that even if Tesla is not able to honor the buyback guarantee, he will personally do it.

So, if the owners are interested about his offer, this means that the company will have a hefty number of used Model S sedans by 2016 and many more in 2017. Tesla offers business leases since April but quietly started to offer 36-month Model S leases to retail customers last week, on October 1.

Read the entire article Tesla developing an used-car program to sell second-hand Model S EVs

The New Jersey Motor Vehicle Commission has no authority to stop Tesla Motors Inc. from implementing its direct sales model in the state, the electric-vehicle maker said in a court filing. Tesla is appealing a move by the commission to change rules in March, which effectively disallowed its stores in the state from selling vehicles as of April 15.

Jim Appleton, president of the New Jersey Coalition of Automotive Retailers, remarked that the issue will likely be resolved in the legislature even before the court hears Tesla’s regulatory challenge. “Something may be on the governor’s desk and signed before they even decide to grant oral arguments at all,” Appleton remarked.

Tesla’s latest brief provides detailed reasons why the Superior Court of New Jersey should overturn the commission’s rules change. Diarmuid O’Connell, Tesla vice president of business development, told Automotive News, that the change in the rules was an “error,” adding that the carmaker has prepared a legal action to deal with it.

Read the entire article Tesla says New Jersey Commission has no powers to stop direct sales

The governor of Nevada -- Brian Sandoval – has inked tax breaks valued up to and a bill permitting Tesla Motors Inc. to bring its direct sales model in the state. The signing came after the state’s 42-member Assembly and 21-member Senate unanimously voted to write off Tesla’s sales taxes for 20 years and property and business taxes for 10 years – paving way to bring the carmaker’s battery “Gigafactory” in its territory.

The breaks were a major part of an agreement that the governor and Tesla chief executive recently disclosed. During a special session, legislators also passed bills exempting Tesla from a law that requires carmakers to use dealers when selling new cars as well as measures reducing tax breaks for filmmakers and insurance companies to do business in Nevada.

Tesla’s win in Nevada is contrast with its continued fight in other states which auto dealer associations oppose its direct sales model. Tesla’s storefront in Nevada has so far met no challenges either in court or in the state’s legislative department.

Read the entire article Nevada permits Tesla’s direct sales model and gives $1.3 billion tax breaks

Opposition to Tesla and its direct sales model has yet to die down despite recent victories in some states. This comes as the Georgia Automobile Dealers Association recently filed a petition of enforcement with state regulators saying that the carmaker’s direct-sales model infringes on state law. Tesla currently operates one store in Marietta (suburb Atlanta) and intends to open two more stores in metro Atlanta.

Bill Morie, president of the Georgia dealers association, told Automotive News, said that they just want Tesla them to comply with the law the way others are. The Georgia dealers association is asking state regulators to bar Tesla from selling its vehicles in state as well as revoke its existing dealer license.

It is also asking state regulators to bar any attempt by the carmaker to renew or reapply for a license. The Georgia dealers association claims that Tesla improperly obtained its dealer license by saying that it is eligible for a statutory exception that allows direct sales for makers of custom vehicles selling less than 150 units annually.

Read the entire article Georgia dealers vehemently oppose Tesla and its direct sales model

Tesla Motors Inc. can now continue its direct-sales operations and even expand in Washington state after Gov. Jay Inslee signed a bill allowing the electric-vehicle maker to continue selling its cars directly to customer s instead of franchised dealerships in the state. Tesla has two stores in Seattle and Bellevue.

Tesla said in a statement that the legislation should serve as a “model solution” for other states where the EV maker have been facing stiff opposition from local dealers.

Tesla spokesman Patrick Jones told Automotive News in an e-mail that the carmaker thanks Gov. Inslee and the Washington State Legislature for supporting “a culture of innovation” and making the right decision for consumers. Jones said the legislation will enable the carmaker to continue its mission of stimulating the EV market by interacting directly with consumers.

Read the entire article Washington state officially approves Tesla’s direct-sales model

Following heart-breaking setbacks in Texas and New Jersey, Tesla Motors Inc. won ground in the Washington state. On President's Day in February, around 40 electric-car advocates gathered at the state capitol, rallying against a bill that would prevent Tesla from launching new sales offices in the Washington state.

When the Legislature completed its work on the bill earlier this month, a coalition of environmentally friendly Democrats and free-market Republicans had already peeled off restrictions from it. Once approved by the government, Tesla could sell its electric vehicles using its own stores instead of having dealers intermediate.

But instead of sulking, auto dealers welcomed the bill, since it provided exception for Tesla while boosting rules requiring other carmakers to sell through their showrooms. The outcome in the Washington state underscores that the current dispute between the Tesla and dealerships. They are still battling it out in states like Arizona, New York and Ohio.

Read the entire article Washington state bill to let Tesla operate direct sales model

The Commerce, Energy and Military Committee of the Arizona Senate has approved a bill, on a 3-2 vote, that would allow Tesla Motors Inc. to sell its cars directly to consumers in the state. The bill requires Tesla to have a service center in Arizona to handle repairs and warranty issues, according to a by the Associated Press.

The bill will be forwarded to another committee for review, and then to the full Senate. Arizona Senate Majority Leader John McComish dubbed the bill as a “pre-emptive strike” against future measures that would outlaw Tesla’s direct-sale model. “What has happened … is that in some states, they are moving to outlaw that kind of operation,” McComish told AP.

“But I think we should be about opportunities for innovation rather than stifling innovation.” A Tesla spokeswoman wrote in a statement that the carmaker is pleased with efforts in the Arizona Senate that could let customers buy EVs directly from Tesla and other carmakers in the state. “We look forward to working with both the Senate and Assembly to pass this legislation in support of the free market in Arizona.”

Read the entire article Arizona Senate committee okays bill allowing Tesla’s direct sales model

Tesla Motors Inc. will sell its Model S sedan in China from CHY734,000 ($121,280) as it tests the demand for electric vehicles in the largest vehicle market in world. According to Autohome, a car-pricing Web site, the price of the 85-kWh Model S lumps it in the same bracket as the Audi S5 sedan and the BMW 5-series GT sedan.

The CHY734,000 is also around 50 percent more expensive than in the United States, where the company is selling an equivalent model for $81,070, according to Tesla’s statement.

The carmaker said that the price of a Model S in China is the same as the price of a Model S in the US, but it seems higher because of unavoidable taxes, customs duties and transportation costs. “If we were to follow standard industry practice, we could get away with charging twice as much for the Model S in China as we do in the US,” the carmaker said in a statement on its Web site.

Read the entire article Tesla to sell Model S in China with starting price of $121,280