Name con­fu­sion forces Tesla to de­lib­er­ately down­play the Model 3

The Hamilton Spectator - - BUSINESS - BRIAN FUNG

Tesla is de­lib­er­ately telling the pub­lic that one of its most an­tic­i­pated ve­hi­cles isn’t ac­tu­ally that great af­ter all.

Why? Be­cause peo­ple keep mis­tak­enly think­ing that the Model 3 will ac­tu­ally out­per­form Tesla’s older — but more lux­u­ri­ous — Model S, ac­cord­ing to the com­pany. In fact, the un­der­ly­ing tech­nol­ogy will be much the same — and it’s the Model S, which starts at $66,000, that will con­tinue to be the com­pany’s top-of-the-line ve­hi­cle, with all the bells and whis­tles.

The Model 3, ex­pected to start at $35,000, was al­ways meant to be a stripped down, cheaper ver­sion that’s suit­able for the masses.

“I thought we were be­ing clever by call­ing it the Model 3. But ac­tu­ally the joke’s on me, be­cause there’s this con­fu­sion,” Tesla chief ex­ec­u­tive Elon Musk said in an earn­ings call Wed­nes­day.

By call­ing it the Model 3, Musk said, some con­sumers have been ac­ci­den­tally mis­led into think­ing that the num­ber is a ver­sion num­ber — sim­i­lar to the way the iPhone 7 is con­sid­ered “better” than the iPhone 6, the iPhone 5, and so on down the line.

In ex­plain­ing the dif­fer­ence be­tween a ver­sion­ing sys­tem and a model sys­tem, Musk him­self got quickly side­tracked.

“Model 3 is not ver­sion 3 of our car,” he said. “We’re prob­a­bly on ver­sion 4 of Model S. And Model 3 will also be ver­sion 4 ... It’s a lit­tle con­fus­ing. One is a let­ter, and the other is a num­ber.”

In terms of ac­tual dif­fer­ences, the Model 3 is smaller than the Model S. It lacks the large dash­board with in­stru­ments that should be fa­mil­iar on more con­ven­tional cars.

The Model 3 is ex­pected to weigh less, pos­si­bly en­hanc­ing han­dling at a slight cost-to-bat­tery ca­pac­ity or per­for­mance.

It’s un­clear just how many con­sumers may have been con­fused, or per­haps put down a $1,000 reser­va­tion de­posit for a Model 3 they thought would be as so­phis­ti­cated as the Model S.

One pos­si­ble source of the con­fu­sion could stem from Tesla’s un­con­ven­tional devel­op­ment strat­egy. Ac­cord­ing to Musk’s decade-old master plan, Tesla’s ini­tial goal was to pro­duce a very ex­pen­sive sports car and then a slightly less ex­pen­sive sedan, be­fore fi­nally turn­ing to a low-cost main­stream elec­tric ve­hi­cle.

But when it comes to other gad­gets and giz­mos, con­sumers have come to ex­pect that the lat­est ac­tu­ally is the great­est. So Musk is be­ing forced to do some cus­tomer ed­u­ca­tion on the fly.


Tesla CEO Elon Musk says the com­pany’s nam­ing sys­tem has mis­led some into think­ing the Model 3 is a later ver­sion of the lux­ury Model S.

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