Tesla Model 3 design and market success

Internet has already posted a lot about the new Tesla Model 3. I want to say something since the launch’s day, but first to start writing down this post, I read dozens of articles and their comments for understanding exactly what happened in the automotive industry and what kind of innovation is really bringing the Model 3.

Why Model 3 is a design success?

Tesla built an incredible brand. Tesla is the youngest automotive company that consumers remember like the older and biggest ones like Toyota, Wolkswagen, Nissan, BMW or Daimler. But unlike them, Tesla made the miracle of giving a desirability aura to electric vehicles and it did it not only making fast, efficient and advanced vehicles, but even having the courage to revolutionize the design of its (future) best-selling model.

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Look at the Model 3 design. It’s the first car that has the courage to hide one of the most traditional and conventional component of the car: the air-front grill. This is amazing not only for the final result, but because the Tesla Model 3 was designed explicitly for disrupting the traditional cars aesthetics. The final result has the same Spiedarman no-mouth mask fashion that everybody know. The Model 3 is more innovative of the Model X because its smaller, its more compact and because it expresses in a more arrogant and vibrant way its innovative design (and technology). I read many critics about the grill’s absence, but all those commenters don’t understand that Tesla did it for differentiating itself from the other companies that, even producing electric vehicles, don’t disrupt the design standards proposing always the same design front, adding just some blue color pattern and a fake air-front grill.

Look at the Model 3 “direct” competitors like the Renault Zoe, the Nissan Leaf and the Chevrolet Bolt, only the Zoe first has an almost innovative design.

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Even the interiors follow the same disrupting concept hiding everything except the central big LCD diplay (produced by LG) that contains all the car’s information. And when I say all, I mean ALL because drivers have nothing except the steering wheel, the lights and windscreen wiper controls in front of them.

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Can you imagine a 40k $ car without the radio’s and the phone’s controls on the steering wheel? Tesla had the courage to design it and obtained a great success from its target consumers and from the media. Chris Ziegler wrote that the dashboard is designed to accomplish the Tesla’s self driving vision, but for me it was designed for being the most disruptive interior possible, even if they will encounter for sure some usability problems like “how drivers should control fastly the speed limit?”, “how difficult will be answering to a call?”, “how many taps will the driver have to do for accessing to the climate controls during the navigation?”.

I suspect that these will be almost the same kind of problems that the first generation iPhone encountered when it could’t change the wallpaper or the ringtonea even if it was introducing in our lives the first mobile application store.

What is the real pre-orders success?

As I explained first, Tesla firstly built two luxury vehicles and then launched its most disruptive car with an almost popular price tag. Who will buy a Model 3 is feeling like someone is buying a 40k $ brand new Ferrari. The incredible value of the Tesla’s brand consists in the fact that even if they are selling a “low cost car”, they are maintaining their luxury proposition. And is more incredible that in two days more than 275k people deposited 1,000 $ for reserving a car that on average will cost them 42k $, but that will be shipped in the late 2017 and that has a “part 2” to be unveiled.

All the other luxury cars manufacturers could never dream to sell an affordable version of their vehicles for the risk of loosing their brands proposition. Tesla instead, talking about technology, environment and sustainability, designed a car that is cheap enough (not cheap at all) to convince hundred of thousands of people to pre-order a vehicle. To be sincere, considering dimensions, performance and autonomy, Model 3 actually has the best value for money on the market.

Two hundred and seventy-five thousands of pre-orders are really a lot, but we must consider that the “Reservation Agreement” isn’t a real purchase. People that deposited 1,000 $ will have just the right to buy before all the other people of their area, but until they sign the “Purchase Agreement” (with the real final price), they can cancel their order without loosing one dollar. Following the document linked by The Verge.

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Even if the thousands pre-orders are just a sort of (serious) purchase intention, the Tesla’s strategy is successful because it’s surpassing the cars sellers problems about their unsold vehicles discussed during the NADA’s convention.

So these pre-orders don’t represent only an almost secure 11,5 billion in sales; they are a real automotive revolution because they mean that a thousands of people decided to buy a car without even sitting inside! This is crazy because Tesla doesn’t sell smartphones. A car is something really personal like a dress or a pair of shoes, but it’s a way more expensive! How many trust Tesla gained from its fans for receiving an average of 42k $ deposit for a car that its future owners have never seen?

What are the threats?

The Model 3 is a marketing and business success, but where the design and the strategy finish their mission, the production, the suppliers, the logistic and the local technical support start their journey. Tesla is a new small brand of the most important industry of the world. As a recent Reputation Insitute research says, the automotive industry is the second for reputation importance.

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Tesla last Saturday entered officially in the cars mass market where everything have to be fast, good and cheap enough to keep (and increase) its market share. Who spend 100k or more dollars for a car, doesn’t really have a mobility problem and can pay a lot for having everything he needs. For satisfying the Model 3 owners instead, Tesla will have to avoid the production delay of the Model X, will have to have a capillary qualified technical service, will have to produce a huge quantity of spare parts and, last but not least, will have to promote the recharge station installation in big cities and highways.

Considering the giant buzz around Model 3, the possible long waiting for the shipping and in fact that in the meanwhile some other manufacturer could put on the market similar or equivalent products, Tesla will have to run everything perfectly. Any delay, quality or assistance problem could mine the young brand influencing the potential customers and even the pre-orders.

For producing hundreds of thousands of car, Tesla will lose a bit of its revolutionary identity, but it could do some scale economies that will free resources for improving its technology or cutting the final cost. Probably the Model 3 will be the last disruptive Tesla’s vehicle because for maintaining the mass production, the error’s margins in an automotive project must be really low.

Concluding I agree with all that people who say that Tesla’s Model 3 is the new Ford’s Model T, but I even agree with Lizzie Wade that says that “Tesla’s Electric Cars Aren’t as Green as You Might Think” because of their environment cost of production, for their uncertain value in the second-hand market and for their batteries disposal.

Personally I think that for everything that humans produce, the earth consumes a bit of its resources that we can’t restore. We can respect more our planet, but we must be conscious that from the homo-sapiens, we started consuming the earth’s resources that one day will finish. We are just delaying that moment in the best way that we can and Tesla maybe is marking the possible roads to our mobility future. One day the oil will finish and in that day we must have the technologies that will grant us the same mobility that we have today.

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