Some material objects are much more desired and sought after than others and some of these items actually cause a massive boom in the market. The iPhone is one such example As soon as it was released, it took off like mad with sales figures soaring left, right, and center. And now, experts are predicting the same is about to happen with Tesla’s Model 3.
Tesla’s Model 3 prices start at just $35,000, meaning it’s the cheapest Tesla motor to date. This is making it very attractive indeed and so far the company has over 400,000 customers on the reservation list eagerly awaiting its release. Already the sales figures have surpassed the $16 billion mark. But can Tesla cope with this amount of orders?
While plans are in place for the company to produce 500,000 cars per year by 2018, at the moment it only makes about a fifth of that, so there’s still a long way to go if Elon Musk is to meet those goals. Chamath Palihapitiva is CEO and founder of the Social Capital LP and said at the recent Sohn Conference in New York, “What we do know is the early traction of Tesla is tracking close to Apple. That third iteration [of the iPhone] is what broke down the walls for consumer demand. The S and X have set the stage for Model 3.”
The first iPhone was launched by Apple in 2007 with prices starting from $499 on contract. Over 1 million were sold within its first year of release. This allowed the company to start dropping prices and the following year 3G iPhones were introduced starting at just $199. By 2009, prices had dropped to just $99, and that same year Apple sold over 20 million iPhones. “The iPhone was an unbelievable feat of technology, of engineering,” said Palihapitiva. “What this product did was capture consumer innovation and it created a tailwind of demand.”
Experts figure the same will happen with Tesla. Those that already have a Model S or X may not be so quick to change to the Model 3. But those who were unable to afford those original luxury models now have the option of buying a Tesla at a reasonable price. With production starting this July, only time will tell if and when there will be a sudden Tesla boom and how the company will cope with the demand.
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