Ford overpays for early model of Tesla SUV
Founders Series Model X vehicle was the 64th to roll out of the factory
Ford Motor Co. paid US$199,950 — US$55,000 more than the sticker price — to buy one of the first sport utility vehicles made by Tesla Motors Inc., according to vehicle registration documents obtained by Bloomberg.
The white Model X is a Founders Series with a vehicle identification number indicating it was the 64th one made at Tesla’s factory in Fremont, Calif. The vehicle, with Michigan plates, has been spotted recently in the Detroit area. Registration records show that Ford purchased the vehicle March 1. The original owner, a California coin dealer, bought it as part of Tesla’s customer-referral promotion.
Automakers often buy cars made by competitors for road testing and for “teardowns” to reveal components and materials and how they’re put together. But it’s unusual to pay such a high price — almost US$212,000 after Michigan sales tax and title — for such an early model.
“Wow, I hope that investment pays off in some good intelligence,” Michelle Krebs, senior analyst for researcher Autotrader.com, said of the premium Ford paid. “If you’re going to be one of the early buyers, you’re probably going to pay well over list. But that’s significant.”
Krebs suspects other major automakers, such as General Motors Co. and Toyota Motor Corp., are also among early buyers of the Model X. Automakers are looking for ways to make highly profitable SUVs more fuel efficient as they race to meet a federal mandate to average 54.5 miles per gallon by 2025. Ford is investing US$4.5 billion in electrified vehicles and will add 13 electric cars and hybrids by 2020.
“We’re going to definitely see more electrification and lightweighting,” Krebs said. “Those are the things I suspect Ford would be taking special note of as they develop their sport utilities of the future.”
Krebs said she hopes chief executive Mark Fields and executive chairman Bill Ford — as well as the automaker’s top engineers and designers — get some seat time in the Model X.
“Everybody should be exposed to one of your hottest competitors,” Krebs said.
Tesla’s first Model Xs are limitededition Founders Series — fewer than 100 of them were made — that typically go to board members and close friends of the company like Google Inc. co-founder Sergey Brin. Those are followed by the Signature Series models, which require a US$40,000 deposit from customers and start at US$132,000. The window sticker price on the all-wheel-drive Model X P90D that Ford purchased is US$144,950, including the US$10,000 Ludicrous Speed Upgrade that boasts a 0-to60 miles per hour time of 3.2 seconds.
The original owner of the Model X that was ultimately purchased by Ford was Wayne Skiles, 71, who owns and operates the Carousel Coin & Jewelry Exchange in San Bernardino, Calif. Skiles owns a Model S sedan and participated in Tesla’s Model S referral program. Customers who referred at least 10 friends to purchase a Model S were able to buy a Model X Founders Series for a base price of US$116,700.
“I sold 11 Model Ss. So I got a Founders Model X and immediately flipped it for a profit,” said Skiles in a phone interview. “The car never came to California. I flew to Chicago, took physical delivery of the Model X, and immediately drove it to a dealer in Chicago and sold it.”
Ford bought the vehicle from Corporate Auto of Auburn Hills, Mich., according to the documents.
“It is a common industry practice among many automakers to buy production vehicles for testing as soon as they are released,” said Ford in a statement. “Sometimes, this means automakers pay more than sticker price to acquire them as quickly as possible.”
Tesla officially launched the Model X at a splashy event in late September, years after the vehicle’s early 2012 unveiling. The company announced that it delivered 2,400 of the SUVs in the first quarter as it continues to ramp up production. But early models are not without flaws: Several customers have reported issues with sensors on the “falcon wing” doors that open vertically.
Consumer Reports on Tuesday published a report about quality problems on early models. Tesla shares slipped 2.6 per cent on Tuesday to US$247.37, paring their year-to-date gain to 3.1 per cent.
“We are committed to making the world’s most reliable cars,” said Tesla in a statement Tuesday. “While we have seen some issues with early Model X builds, the issues are not widespread, and we are working closely with each owner to respond quickly and proactively to address any problems. We will continue to do so until each customer is fully satisfied. This commitment is one of the reasons why 98 per cent of our customers say they will buy another Tesla as their next car.”
Earlier this month, Tesla issued a recall on 2,700 Model Xs made before March 26 to repair the thirdrow seats after strength tests done by the automaker found a potential defect.
Tesla has advised customers not to let anyone sit in those seats while the car is in use.