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What does the discontinuation of the MS60 mean for the M3?

What does the discontinuation of the MS60 mean for the M3?

Just wondering everyone's thoughts on this. Is this to clear the way for a slightly smaller pack; 50 or 55 for the 3? Or solely due to lack of sales for the 60 as most buy the 75.

Red Sage ca us | 18. März 2017

Yes.

SamO | 18. März 2017

Discontinuing the model S 60 will increase the margins for the model S, and will create a gap where a maxed out model three will likely approach $70,000.

Tarla's Driver | 18. März 2017

Pre-announcing the decision says that they want to do one big last push to get Model 3 reservation holders to jump on a Model S 60 now. They're telling reservation holders that were considering it to make up their minds now.

Frank99 | 18. März 2017

They brought the 60 back to upsell Model 3 buyers. I'm guessing they figure they've upsold just about everyone by now; so by getting rid of the Model S 60 they open up pricing space between the 3 and S as SamO noted.

SoFlaModel3 | 18. März 2017

Improves margins since I doubt there were many 60 buyers that went out and upgraded to the 70 after taking purchase.

bj | 18. März 2017

What does the discontinuation of the S60 mean for Model 3? It means that speculation here about a single physical battery size for Model 3 with software unlockable steps is DOA. Absolutely never will happen.

Carl Thompson | 18. März 2017

Tarla's Driver:
"Pre-announcing the decision says that they want to do one big last push to get Model 3 reservation holders to jump on a Model S 60 now. They're telling reservation holders that were considering it to make up their minds now."

Could be. I wonder if that means there may be a Model 3 announcement shortly after the discontinuation date?

Carl

greg | 18. März 2017

@bj "It means that speculation here about a single physical battery size for Model 3 with software unlockable steps is DOA. Absolutely never will happen."

Possibly.Time will Tell.

The warning is really just like the removal of lifetime supercharger access announcement late last year, as a way to wring out the last few sales from those fence sitters who want a Telsa but don't want to wait too long for it. Will help sway those guys to push the button on a S60 [maybe instead of a as 3].

But you also have to wonder how much longer lifespan the 90/90D model S has left too.

Right now, the Design store indicates a bare $3000 USD difference between a non-P 100D and a 90D.
Its even lower in some other currencies [but not AUD - due to effects of your import taxes like the ludricrous LCT]. So it indicates that Tesla will sell the bigger 100 model with the 10 kWHr capacity selling for around the likely "cost" rather than the premium that exists between the 75 and 90 now.

So maybe the 60 model run-out is actually indicating a bigger step change and is all about a battery size rejig across the entire S [at least] range?

Maybe the S75 will be retired at some point and then bump up to S85 as the entry model, and the 90 is removed so that just leaves just a 85 and 100 sized models.
With a P100D being the top of the heap for a Model S as it is now.

That would leave even more of a potential price and range "head room" between the top of the 3 pile and the bottom of the S pile.

And maybe the top of the line, Model 3 is a P85D [using 2170 cells] selling a little below the 85D model S.

It also ties in with the indistinct comment reported elsewhere that Elon made in the investor fund raising call last week about "transitioning the existing S and X batteries across to use 2170 cells during this year" as well.

Somehow I don't think this Model S 60 (re)retirement will be the last change around of Model S and X battery sizes this year for sure.

Further details will no doubt come out about the time of the Model 3 reveal.

hoffmannjames | 19. März 2017

Yeah, I think the 90 will be phased out at some point too. It is too close to the 100 model. I think it would make sense for Tesla to streamline their choices and make them more distinct. The S could come as a 75 or 100. That way, there is a clear lower end and higher end S. The same could be done with the 3. There could be a 50 and a 70. That way, there would also be a very clear lower end and higher end model 3 to choose from. This would give customers a lower end and higher end choice for both the affordable and luxury models.

noleaf4me | 19. März 2017

Hoff -- not sure they can get to 215 miles with a 50 kWh battery. That is 4.3 miles per kWh -- a bit high even for the good aerodynamics of the M3. I still bet the base will be 55 so they can guarantee the "at least 215 miles" of range.

With the Bolt having 238 miles -- I'm sure Tesla is not going to have that delta too large if at all....

Rsandy | 19. März 2017

My guess is that Tesla wants separation between the S and the 3 and to maintain higher performance in the S to justify the premium prices. If I am right about those intentions that would put the largest battery in the 3 below the 75 minimum in the S. As for two battery choices for each model, Tesla always pushes the envelope to increase sales at the high end. That implies something above the 100 for the top end S. How much above 100 depends on the energy density gain and space constraints of fitting the 2170s in the S. Something around 120 is feasible. For marketing purposes it has to be a distinct step above than the 100. I predict (for what it is worth) is two levels in the 3 at around 55 and 70 and three levels in the S at 75, 100, and 120.

bmalloy0 | 19. März 2017

Didn't Elon say that the S wasn't going to have >100kWh for the foreseeable future?

topher | 19. März 2017

@bmalloy0:

Actually, he said that they couldn't fit any more (18650) cells into the area assigned for them. And that he didn't see any need to increase range further.

That is subtly different from no change in foreseeable future. Converting to 2170s might gain some range, which they are unlikely to just ignore. Pressure from customers or competitors might change perceived need.

Thank you kindly.

andy.connor.e | 19. März 2017

It means nothing. Because since the car is smaller, more aerodynamic, lighter you know all that nonsense. The Model 3 just from a physical standpoint should get more range per kWh than Model S & X. So there is no way to determine whether this discontinuation will have any impact on the Model 3 battery options.

johnse | 19. März 2017

Marginal cost of the batteries is roughly $1300-1900 per 10kWh. Packaging and cooling the modules will be roughly the same for the different S and X batteries since they use the same number of modules.

My suspicion is that in the redesign for the 2170 cells they will drop to 2 batteries on the S/X: 80 & 100. Marginal cost likely in the $3000 range, leading to a $6-10K price difference and the price of the S80D being approximately the same as the current S70D due to battery cost reductions.

I think the importance of the elimination of the S60 cannot be overstated. It seems less about, "We've converted all the Model 3 buyers as we can," and more, "we no longer need the lower priced car because the Model 3 is on schedule and will be selling soon."

I agree with others that a maxed Model 3 will only have a small overlap, if any, with the Model S price range. This keeps the S and X as aspirational vehicles and maintains their halo effects.

Carl Thompson | 19. März 2017

@johnse

Yes, exactly.

Carl

krissu | 19. März 2017

If they wanted to streamline something, they would have dropped RWD, not 60

EaglesPDX | 19. März 2017

"@bj "It means that speculation here about a single physical battery size for Model 3 with software unlockable steps is DOA. Absolutely never will happen."Possibly.Time will Tell."

Pretty much fer shure...as Tesla stated that base T3 will have less than 60 kWh battery pack so to get more range than the base will mean a bigger battery.

JeffreyR | 19. März 2017

@krissu that's been a common wish on these forums. The Model X definitely gave reason to that wish. But, I think that the ability to charge for AWD outside a SUV/CUV is something well established in the market. Especially w/ M3 that is too good a way to charge for something that definitely adds value to the car.

The market may move on this (especially for MS), but I doubt the M3 will be standard w/ AWD to start, if ever.

nadurse | 20. März 2017

@JeffreyR, while that is generally true regarding AWD, subaru is the exception there and they make it work. You can go buy basic entry level impreza and legacies and you get awd. Basically all of subaru's cars,with the exception of that FRZ or whatever rwd sports car is called, come standard with awd. They have a cult like following and that is no doubt part of it. It wouldnt be that crazy if the M3 followed this thought process with the purpose of going mass market, build in the AWD to the base model since most people want that anyways, especially in the northern half of the country, its just a matter of affording it on most cars.

topher | 20. März 2017

Could they make AWD cheaper by shrinking the motors in the base model? THey could even make them less than 1/2 the size. I would gladly have an AWD base model with 0-60 twice what it is currently. People wanting performance would pay more (for bigger motors), while everyone gets AWD.

Thank you kindly.

b8schris | 20. März 2017

Well they are not going away, I love the cpo used Teslas. This year we will see a bunch of 2014/ off of leases popping in to the market. A 2013 85 is in the 50k range with nic upgrades. I think those will be the real competition for the model 3. There really is a limited market for evs and Teslas. While we are believers you k ow that when you talk yo your friends, they just don't get it sometimes. So, as cars come off of lease they will become incredibly got affordable and the model S will eventually do away with all but 100kwh and up. (My guess). A prestige car.

mos6507 | 20. März 2017

The move was reactive, not proactive. In other words, Tesla is discontinuing the S60 becase...it isn't selling enough. Nothing more, nothing less.

andy.connor.e | 20. März 2017

Battery size in the M3 is not the big picture. Its how many miles/kWh the M3 can get. If the car can get 8miles/kWh, it doesnt need a 100kWh battery. Nor will it need more than 50kWh as a base.

Another reason why literally 75% of the buying decision is waiting on Tesla to release the vehicles full specifications, and not only options, but their prices.

topher | 20. März 2017

"If the car can get 8miles/kWh"

... the ICE party is over. Seriously, @ $0.0125 per mile, EVs would DOMINATE. (that is the equivalent of gasoline at $0.625 in a Prius) I am expecting maybe half that if we are really lucky.

Thank you kindly.

andy.connor.e | 20. März 2017

Use a gasoline perspective. Is it about the gas mileage? Or the size of the gas tank?

CraigW | 20. März 2017

Think of it from an EV perspective...miles/day is the key figure. The only reason the size of the gas tank is a factor is that people really don't like stopping at a gas station. With EV, they do it at home - while they sleep. With a wider acceptance of BEV this fact is going to embed itself into people's consciousness.

Carl Thompson | 20. März 2017

andy.connor.e:
"If the car can get 8miles/kWh"

That's not at all realistic for real-world driving. If we're luck the Model will get half that (4mi/kWh). Maybe 5 if you drive like grandma.

Carl

Red Sage ca us | 20. März 2017

b8schris: No. There is no 'limited market' at all. Tesla has sold 11 years worth of Model S in 4-1/2 years. Cars it competes against have seen their sales steadily drop. Model ≡ will be fine.

Calibrotha2000 | 20. März 2017

I think it has to do with the range that the 3 will have. You can't have a base model S with 210 miles and then a base model 3 with 215 miles. By eliminating the 60 and making the base S now be a 75 that gives a base range of 249 miles. So now that allows a base model 3 to have anywhere from 225-235 miles and still not come in with a better range than and base S. It makes perfect sense from a sales standpoint.

JeffreyR | 21. März 2017

@nadurse Subaru is the exception that makes the rule isn't it? My point is that the market at large, especially MB C Class, BMW 3-Seires, and Audi A4, have shown that you can charge for AWD as an upgrade. But, at some point it may make sense to go all AWD to differentiate from the competition. Right now the drivetrain is so superior to the competition that's not necessary.

Red Sage ca us | 21. März 2017

The Model S was developed to sell perhaps 15,000 units per year for around 8 years. It had already sold over 11 years worth of cars after only 4-1/2 years. Every Model S sold from now through 2020 is extra-special bonus dough. That car has already proven and paid for itself. Before the Model S had been on the market for one year Tesla had announced their intention to offer a more affordable Generation III vehicle series to be sold at 500,000 units per year. The Model 3 is not some nuisance or afterthought. The Model 3 is the goal for Tesla.

The BMW 7-Series has a greater range than the 3-Series. But only because the 7-Series has a 19.0 gallon fuel tank, while the 3-Series has a 15.9 gallon capacity. Using the same amount of fuel, the 3-Series will travel further than the 7-Series.

The Performance iteration of a 3-Series is quicker, faster, and handles better than that variant of the 7-Series. Whether Alpina B7 or M760, the M3 costs less and kicks butt, while selling more. This strategy has served BMW well, as the 3-Series is typically the best selling premium passenger car worldwide. Those who have chosen the opposite tack, to 'protect' their flagship vehicles from the performance potential of lower level products, have typically seen their sales fall behind BMW's. A prime example is the Lexus LS and IS, which both lag behind 7-Series and 3-Series in respective sales every year.

So, no, it does not make sense from a sales standpoint to gimp any of your cars. A Model 3 with a 60 kWh battery pack capacity will have greater range than a Model S 60. A Model 3 75 will have greater range than a Model S 75. A Model 3 90 will have greater range than a Model S 90. To do otherwise would be to take away the advantage of the efficiency gained with electric drive.

nadurse | 21. März 2017

Generally speaking, I dont think its the fool-proof to just look at Tesla did on the Model S and say, yep thats how they are going to do it on the Model 3. I would assume that there are a ton of lessons learned from a car that was designed 7 years ago. Also there are completely different design intents for the S vs the 3, low vs high volume production, and completely different price points.

I think having this last push for the S60 and then discontinuing it makes a lot of sense. If someone was on the fence about a model 3 or an entry level model S then this gives them a date to make a decision. Once the model 3 is here, there wont be a need for a software limited model. If people dont want to pay for the 75kwh, then they have the option to get a model 3. It creates more differentiation between the two models which also makes sense and makes it more clear cut for the consumer. I dont think range or not having enough sales has much to do with this decision.

@Jeffrey, yes i clearly said generally thats true but heres this notable exception. I get what you are saying ;)

Red Sage ca us | 21. März 2017

People will buy what they want, what they need, what they can afford. That is the extent of differentiation needed. They can determine those points on their own, without being led by the nose.

Badbot | 21. März 2017

saw somewhere that the Y was 37k or 38k target price. and I thought WOW that's a slim increase just the D option is likely to be higher than that. assuming the Y is AWD only a super bargain.

JeffreyR | 21. März 2017

@Badbot I'm sure they were extrapolating from "the 'D' will be a cheaper upgrade on M3 than on the MS." Along w/ the fact that the difference between base MS vs. MX is not that much either. $37-38K MY base seems like a good start.

sosmerc | 21. März 2017

I am hoping the Y is a hatchback, standard with AWD and whatever battery size can give it a range of 275+.
Fold flat second row seats, a tow package and a roof rack option. My dream machine with a price tag of $50,000 or less.

nadurse | 22. März 2017

@Red Sage,

I think you vastly over estimate the knowledge and perception of the average car buyer. This car is meant to propel Tesla out into mass production, this means you will be also dealing with the mass population.

Over half of car buyers know nothing or next to nothing about electric cars.

http://blog.caranddriver.com/study-60-percent-of-u-s-drivers-havent-hear...

JeffreyR | 22. März 2017

@nadurse Never underestimate the stupidity of humanity, right?

I think @RS would agree w/ you there. But Tesla already knows that selling EVs is more difficult than existing cars. That has been their main argument for using Galleries and Stores instead of third-party franchised dealers. Even w/ their soft-sell approach they are beating Apple in sales per square-foot. And that's also selling cars that most people do not understand.

The good news is that once Tesla gains a foothold in a neighborhood, there is a visible jump in sales numbers. The reason is that if The Jones can figure out how to make it work for them AND you can ask them directly how and drive w/ them to see it in person, then you are much more likely to take the leap too. My friend Gary took me on my first Tesla drive. We had the Twins in back and we have all been hooked since. It costs them about $45/month to drive their Tesla. I know they are careful w/ their finances and are very smart so I trust their math. I also know that I could not stop grinning after that first drive.

The other good news is we only need to find 1M buyers/year by 2020. Figure three referrals per reservation holder and owner. I think we can manage that. Then all Tesla needs to do is close a decent percentage. I think the cars will help them manage that too.

JeffreyR | 22. März 2017

And another thing to realize is that regardless of what battery pack the base, RWD Model 3 comes with, it will still cause the Tesla Grin.

Red Sage ca us | 23. März 2017

People who want a big, luxury car probably decided years ago, with no comparison shopping whatsoever, that what they wanted to get 'some day' is a particular Cadillac, Lincoln, Mercedes-Benz, BMW, AUDI, Jaguar, or whatever. They don't care what anyone else thinks is 'better'. They will buy what they want.

People who must fill a particular need will purchase the vehicle they feel most closely does so. Whether that need is people hauling, material handling, or prestige stroking. They will set their own priorities and get what they perceive most closely meets their need.

When someone decides to purchase a new car affordability is often at the forefront of their concerns. People have different perceptions of what it means to 'afford' something. For many, it is simply the ability to 'make the payments'. For some it is that point by which their inherent frugal nature is overcome by the perceived value of the proposed purchase. For others it is all about getting 'the most' they can for the money they intend to spend. No one can tell any of them what they can afford.

People will buy what they want, what they need, what they can afford. That is the extent of differentiation needed. They can determine those points on their own, without being led by the nose.

SUN 2 DRV | 23. März 2017

"People will buy what they want, what they need, what they can afford. That is the extent of differentiation needed. They can determine those points on their own, without being led by the nose."

Red, I completely agree except for the last point... because people will make those decisions based on their PERCEPTIONS of what they want, need and can afford. And that's where the marketing and product positioning become critically important, because those have a HUGE influence on people's perceptions...

The positioning and differentiation between the MS and M3 ARE critical, both to people's perceptions and also to Tesla's margins and bottom line.

Red Sage ca us | 23. März 2017

I perceive that an intended annual worldwide audience of 500,000 units is much greater than one of 15,000.

Check fuel economy ratings for BMW 3-Series prior to 2012. You'll find they are generally horrid for such a size/type of vehicle. Yet the 3-Series was the perennial victor both in U.S. and worldwide for premium passenger car sales and had been for decades. The 3-Series was also renowned worldwide as the benchmark for automotive excellence. These points made the 3-Series the perfect target for what will be the Tesla Model ≡.

The differentiation between Model S and Model ≡ is at least as much as between 3-Series and 7-Series, or C-Class and S-Class, or A4 and A8, or IS and LS, or XE and XJ. Of course, the Model ≡ will also have the distinction of costing less than 5-Series, or E-Class, or A6, or GS while having similar or better interior volume and being a much better performing vehicle as well.

This isn't critical, it is simple.

4fishtankz | 24. März 2017

I think they should hold out on benching the S60 a little longer until it is certain when the performance 3 will be released. I was considering the S60 but wanted an upper end 3 before a lower end S. The last tweets though and what the first 3's will look like may make me look harder at the S60. Maybe this is the point?

4fishtankz | 24. März 2017

Carl -
Tarla's Driver:
"Pre-announcing the decision says that they want to do one big last push to get Model 3 reservation holders to jump on a Model S 60 now. They're telling reservation holders that were considering it to make up their minds now."

Could be. I wonder if that means there may be a Model 3 announcement shortly after the discontinuation date?

Since Elon has been so close to the vest about what the Model 3 will have, I think they should keep the S60 until the final reveal for those, like me, who want to see the final specs so that I can compare and make up my mind. Every time I get an email from Tesla about an offer on an S, or at the open house and at the S test drives, I asked the sales associate what the differences would be with the 3 and of course they didn't know. I want a list and a cost so that I can compare and crunch numbers and see which one fits my and my family's needs.

Haggy | 24. März 2017

It means that if you have any thoughts in the back of your mind that getting a Model S 60 might be a good idea, you can no longer keep it in the back of your mind. It might be your best option. Being able to upgrade later makes it so much the better.

It also means that there will be a clear gap between a maxed out Model 3 and a base Model S. That means a base Model S will be better than a maxed out Model 3, except of course you won't have autopilot/FSD unless you add them later. But for actual driving, the Model S will be a better car.

Or you can wait for the Model 3 and get an excellent $35,000 car that gets even better as you add options.

brando | 24. März 2017

Question about electric motors

How many different motors?
i.e. are all rear motors the same? all front motors the same?
75D have different motors from P100D?

Well, you get my drift. I checked TeslaTap and it seems this specific info not available (mostly speculation).

The story of motor pros/cons and final selections must be fascinating.

side note: the number of different ICE engines offered by European models never made sense to me.

Haggy | 24. März 2017

This is a better question for the Model S forum. I think adding D to the basic model adds another smaller motor in front, but going up to the P makes the motor in front the same as what the standard one has in the back, and there's a bigger rear motor. But I could be wrong. If I got it right, that makes three motors for the S.

Red Sage ca us | 25. März 2017

It may be the actual physical motors are the same, even though the drive unit assembly is different for rear motor and front motor, while the inverter at the rear is different on the Performance variants.

hoffmannjames | 25. März 2017

Getting back to the original question of this thread, I think Elon's tweet about the 3 being a smaller car with less features than the S reinforces the idea that Tesla is cancelling the S60 in order to encourage people to go for the 3. The S60 most likely had a lot of overlap with the high end 3 but with nicer features so people hesitating between the two, would most likely pick the S instead of the 3. This way, those same people will have to go for the high end 3 since the 60 won't be an option anymore.

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