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Tesla Model X could outsell Model S

Great Xpectations: A warm US reception and strong Australian SUV market could push Model X sales past its Model S sedan sibling.

Premium SUV may knock sedan off top-selling Tesla mantle

Tesla logo5 Jul 2016

By DANIEL DEGASPERI

A LOCAL Tesla executive has hinted that the forthcoming Model X premium SUV could outsell the Model S sedan in Australia, while the wait for next year’s Model 3 is tipped to narrow thanks to lessons learnt from current models.

Speaking with GoAuto at the opening of Tesla’s flagship store at Martin Place, Sydney, senior manager of marketing and communications Heath Walker admitted that while demand for the Model S remains high, the large sedan class continues in decline while the SUV segment continues an upward trend.

“Australia continues to be a really strong market (for Tesla) and the momentum hasn’t stopped for Model S,” he started.

“That’s in a market within Australia that is a somewhat declining segment, it’s a large luxury sedan, but I think the nice thing about Model S is that it transcends the segment and actually goes across segments.

While the continued sales performance of the company’s sedan remains to be seen, Mr Walker said predicting the reception of the forthcoming SUV was a simpler task.

“Model X is a whole new segment, it’s a luxury SUV and all you have to do is look at the other brands bringing out luxury SUVs so clearly there’s a market for them and Australia is one of those strong markets.

“We’ve already seen a lot of interest in the vehicle (Model X) and … I think that will continue to grow once we’re in market because nothing markets a car like seeing it on the road, and I don’t think you’ll miss too many Model Xs in carparks with those falcon-wing doors.”

Regarding the Model X’s local arrival, Mr Walker added: “We’ll have an update on when the car will be able to be seen and experienced in the coming months and then deliveries will be here late Q4 (fourth quarter 2016).”“We always have price parity with the US, except for Luxury Car Tax (LCT) unfortunately,” he further confirmed.

In the US the entry Model X 70D costs US$3500 (AU$4700) more than its sedan equivalent, while the flagship Model X P90D is US$6000 (AU$8000) pricier than its four-door sibling.

Based on current exchange rates, Australian pricing for the Model X would start at $126,500 and extend to $173,800 before on-road costs.

However Mr Walker does not anticipate that future demand will significantly outstrip supply in Australia.

“I think with Model X having its own production line in addition to Model 3 having its own area for production will devise a brilliant logistical plan for Tesla to roll out vehicles,” he said.

“The nice thing about our production line is that right-hand drive is just filtered in among left-hand drive and it’s assigned according to the order.

Obviously as orders grow it has an impact on the production line … but we’re able to update that with a timeline we’re always updating our customers on.”

Mr Walker also hinted that we may see a shorter wait time between the US and Australian launches of future Teslas, citing next year’s Model 3 as a beneficiary of lessons learnt from Model S and Model X.

“Model 3 will go into production in 2017 and we expect deliveries to commence in the US at the end of 2017, and then right-hand drive market will be after that,” he explained.

“It’s hard to know when because even with left-hand drive … they will be prioritising volume markets. We’ll have come so far with Model S and Model X by the time production (of Model 3) starts, and there’s so many learnings that we’ve achieved through Model X.”

Australian Model X deliveries have run approximately 12 months behind the US.

Mr Walker further revealed that Australians interested in the Model 3 were instead purchasing the recently reintroduced price-leading $100,800 Model S 60.

“What the 60 has done is sparked interest with those who were potentially going to wait for a Model 3 and were always going to spec up a Model 3 to get to what the Model S is (costs),” he added.

Tesla continues to refuse to answer questions about model-specific volume, and locally it does not report figures to industry body VFACTS because the company believes it is an unfair comparison.

“VFACTS is reporting manufacturer to dealer and we would be reporting on end delivery to customer, and we always have and always will because it’s a true sale,” he said.

“In the end we are very customer focused and I’m not sure that does any service to the customer knowing where Tesla sits in the hierarchy of sales.”

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