Model 3 Reservation Holder Survey Underlines Tesla’s Mass Market Challenge

 

They waited for reservations… will they also wait for service? (image courtesy Investors Business Daily)

Much of the critical coverage of Tesla Motors, both here at Daily Kanban and elsewhere, has focused on issues that Tesla is able to get away with as a small-volume manufacturer serving an affluent, early-adopter market segment. From manufacturing bottlenecks to quality control problems, from inconsistent, hype-happy communication to poor service, Tesla has been able to weather a storm of problems because its customers and fans are so patient with and passionate about the company. But as Tesla moves from expensive, low-volume cars to the mass market Model 3 these problems are taking on a new significance. In part this is because higher volumes increase the likelihood of quality and service problems, and in part it is because mass market customers who depend on a single car for their daily routine are more demanding than luxury car buyers who can always take the Lexus to work if their Tesla is broken.

Given Tesla’s pattern of releasing cars with insufficient testing as well as its chronic quality problems, it’s safe to assume that the Model 3 will face its fair share of issues. Thus, investing in service infrastructure that will allow Tesla to promptly and affordably repair and upgrade high volumes of Model 3 is extremely important. As Bertel has written about at Forbes, Tesla is behind the curve on those investments and it will cost billions to catch them up. Just yesterday a piece by former Tesla employee Evan Niu dramatically illustrated just how far Tesla has to go to improve its service time, which has dragged on for 8 long months in Niu’s case. Now an exclusive study of about 800 Tesla Model 3 reservation holders, EV owners and luxury brand car owners conducted last year on behalf of a major automaker and provided to Daily Kanban by an industry source, reveals why Tesla’s quality and service woes are so critical to the success or failure of the Model 3.

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Detroit Auto Show: Signs Of Trouble Ahead

Buckle up!

Buckle up!

Interpreting what an auto show has to say about the state of the car industry isn’t always easy. Though there’s enough groupthink in the industry to regularly produce obvious trends (current example, “Shooting Brake” three-door sportscar hatchbacks), these are mostly just the superficial fluctuations of any fashion-oriented business. Looking deeper, however, connecting a show’s trends with the broader market context, is often quite difficult. Not so for this year’s Detroit Auto Show, however. Simply scanning through the new debuts, the lack of mass-market or utilitarian offerings was immediately noticeable. More to the point, the glut of luxury products was inescapable. [Continue Reading]

Heard any good jokes lately? Meet the man who knows how to bring Cadillac to global glory, “easily.”

Uwe at Tuck

Uwe at Tuck

Cadillac doesn’t have a new marketing chief quite yet, Uwe Ellinghaus will officially start on January 1, but Uwe is already giving interviews. What is making headlines around the world is that Uwe told Ben Klayman of Reuters that “it could take as long as a decade to build Cadillac’s reputation as a global luxury brand.” That may shock some at GM who hope Uwe would be finished sooner, say, can you do it before the end of the current quarter? Keep hoping, because it keeps you from finding out that Uwe is on crack.

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