Well not quite but close. More frequently Tesla is building hardware upgrades into every car it sells and offering to activate those features at a later date, for a cost. This means if you go out and buy a car without Auto-Pilot you can turn it on a week or years down the road. Maybe you get a big bonus one Christmas and decide to treat yourself. Maybe your birthday is coming up and your wife knows exactly what to get you...
They're further tempting people by dangling the carrot of free trials, most recently offering a 30 day trial period of Auto-Pilot to every car equipped with the hardware.
But that's not the coolest part
This is. When I used to be actively involved in the Taurus SHO community we'd regularly get people popping up on the forum with Taurus GL's asking how they could swap the SHO motor over to their car. The same happened with the GM W body community and believe it or not... The same thing happened with the e60 M5s. People used to speculate how much it would cost to swap their 530i engine for an S85 V10.
But if you buy a Tesla, simply paying for the upgrade might become an actual alternative to selling your car and buying the better version. Tesla just introduced a new base model car: the 60. The S60 is functionally identical to the S75 only the S75 is faster and has more range. The difference between the two cars? Nothing. Or actually I should say a few 1s and 0s. The S60 is a software limited version of the S75. Let's say you can only afford the S60 now. No big deal. A year down the line if you decide you want the better car, you simply pay the Tesla and they'll immediately unlock it. I believe it's even done over the air.
And the way Tesla offers test drives seems to suggest that this might be something that becomes more prevalent in their lineup. It used to be that if you went in and test drove a Model S you were test driving the P85. The dealers didn't really have the regular 85's or 60's to test. You relied on other owners for input or test drives. It's generally the same thing now. The test drive cars are top of the line P90D's only let's say you're not buying a P90D. Let's say you're getting a lowly S70 because you're POOR. You hop in the car and your sales associate tells the car to behave like an S70. Rear wheel drive only, acceleration is limited to that of an S70.
Lifelong Money Generator
As most know, economies of scale are such that you try to limit the variants of a particular part. You don't want 9 different bumper covers for one car depending on options chosen. Tesla eliminates this by fully outfitting each car with Auto-Pilot. When you look it the Autopilot system it's clear that much of the cost is in the software, not so much the hardware. So it makes sense for them to do this. The same goes with the motors. Other than the special contractors required for the top of the line P90D w/ Ludicrous mode cars, the 70D motors aren't much cheaper to manufacture than say the 90D motors. And so it stands to reason Tesla might get to a point where they're simply outfitting the cars with the best motors and limiting them via software.
The same goes with the batteries. Right now Tesla only does it with the 60/ 75 batteries but as the price of batteries continues to decline, we're going to get to a point where it's going to make sense to outfit every car with the best battery.
And in this sense, Tesla is going to be able to capitalize on something I don't believe any other auto manufacturer can claim: vehicles that offer a continued source of revenue with no additional cash outlay.
And the money people are spending after they have already purchased their cars is gravy. There is no additional labor or parts required. There are no more opportunity costs other than advertising to me that an upgrade is possible.
You can almost forget the car, I think this way of offering continued value to your customer and a continued source of revenue to your company is going to drastically change the way people purchase cars in the relatively near future.
They're further tempting people by dangling the carrot of free trials, most recently offering a 30 day trial period of Auto-Pilot to every car equipped with the hardware.
But that's not the coolest part
This is. When I used to be actively involved in the Taurus SHO community we'd regularly get people popping up on the forum with Taurus GL's asking how they could swap the SHO motor over to their car. The same happened with the GM W body community and believe it or not... The same thing happened with the e60 M5s. People used to speculate how much it would cost to swap their 530i engine for an S85 V10.
But if you buy a Tesla, simply paying for the upgrade might become an actual alternative to selling your car and buying the better version. Tesla just introduced a new base model car: the 60. The S60 is functionally identical to the S75 only the S75 is faster and has more range. The difference between the two cars? Nothing. Or actually I should say a few 1s and 0s. The S60 is a software limited version of the S75. Let's say you can only afford the S60 now. No big deal. A year down the line if you decide you want the better car, you simply pay the Tesla and they'll immediately unlock it. I believe it's even done over the air.
And the way Tesla offers test drives seems to suggest that this might be something that becomes more prevalent in their lineup. It used to be that if you went in and test drove a Model S you were test driving the P85. The dealers didn't really have the regular 85's or 60's to test. You relied on other owners for input or test drives. It's generally the same thing now. The test drive cars are top of the line P90D's only let's say you're not buying a P90D. Let's say you're getting a lowly S70 because you're POOR. You hop in the car and your sales associate tells the car to behave like an S70. Rear wheel drive only, acceleration is limited to that of an S70.
Lifelong Money Generator
As most know, economies of scale are such that you try to limit the variants of a particular part. You don't want 9 different bumper covers for one car depending on options chosen. Tesla eliminates this by fully outfitting each car with Auto-Pilot. When you look it the Autopilot system it's clear that much of the cost is in the software, not so much the hardware. So it makes sense for them to do this. The same goes with the motors. Other than the special contractors required for the top of the line P90D w/ Ludicrous mode cars, the 70D motors aren't much cheaper to manufacture than say the 90D motors. And so it stands to reason Tesla might get to a point where they're simply outfitting the cars with the best motors and limiting them via software.
The same goes with the batteries. Right now Tesla only does it with the 60/ 75 batteries but as the price of batteries continues to decline, we're going to get to a point where it's going to make sense to outfit every car with the best battery.
And in this sense, Tesla is going to be able to capitalize on something I don't believe any other auto manufacturer can claim: vehicles that offer a continued source of revenue with no additional cash outlay.
And the money people are spending after they have already purchased their cars is gravy. There is no additional labor or parts required. There are no more opportunity costs other than advertising to me that an upgrade is possible.
You can almost forget the car, I think this way of offering continued value to your customer and a continued source of revenue to your company is going to drastically change the way people purchase cars in the relatively near future.