Wednesday, April 6, 2016

Tesla, the Marketing Phenomenon

When Tesla's CEO announced the all-new, all-electric Model 3 at the end of March, car buyers didn't just cheer--they threw money at the company. Within three days, Tesla had received 276,000 pre-orders, accompanied by $1,000 per order.

And within days, the company was talking about whether it would deliver on time. After all, it usually delivers fewer than 52,000 vehicles per year, but its stated goal is to deliver 500,000 per year by 2020. Tesla's new battery factory won't be completed until next year, another factor that will affect the ability to deliver Model 3s on time.

Tesla made its name with high-end, all-electric cars that look classy, cost dearly, and perform like, well, high-performance vehicles. The Model 3 is different from the Model X and Model S because it's popularly priced at about $35,000, before government tax credits for energy efficiency. The price has captured many a headline.

Tesla's goal is to popularize eco-friendly cars. Specifically, it wants "to accelerate the advent of sustainable transport by bringing compelling mass market electric cars to market as soon as possible." The firm has even offered to open its patents to competitors to speed the process. It is building supercharging stations nationwide and around the world to make recharging faster and more convenient for drivers, and increasing the range of its cars to sidestep the fear of not being able to reach destinations before the charge runs out.

Often Tesla is called the Apple of the automotive industry, because of its obsession with tech innovation and design. Yet Apple may wind up competing with Tesla at some point. GM's Chevy Bolt will be a direct competitor when introduced next year. Stay tuned for a fascinating marketing phenomenon.

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