Tesla is offering three months of a free Full Self-Driving (FSD) package as an unprecedented end-of-quarter incentive to deliver more vehicles, according to sources.
Over the years, Tesla has come up with several incentives to encourage buyers to take delivery by the end of a quarter in order to boost its earnings.
This quarter is unprecedented.
As we have been reporting over the last few weeks, Tesla aims to deliver a record number of vehicles this quarter to achieve 500,000 deliveries in 2020 – a long-time goal for the automaker.
In order to achieve the milestone, Tesla must deliver over 181,000 vehicles this quarter. That’s more than 40,000 vehicles over its last quarterly delivery record, which was just achieved last quarter.
The automaker has offered the usual free Supercharging as a perk to incentivize people to take delivery, but now, we learned that Tesla is offering a new perk that it hasn’t offered before.
Sources familiar with the matter told Electrek that Tesla has authorized staff to offer three months of a free Full Self-Driving (FSD) package to people who can take delivery by the end of the year.
Here are the features that new buyers will get access to for three months:
- Navigate on Autopilot: automatic driving from highway on-ramp to off-ramp including interchanges and overtaking slower cars.
- Auto Lane Change: automatic lane changes while driving on the highway.
- Autopark: both parallel and perpendicular spaces.
- Summon: your parked car will come find you anywhere in a parking lot. Really.
- Traffic Light and Stop Sign Control: assisted stops at traffic controlled intersections.
Tesla sells this package for $10,000, with the true value being the promise of enabling true full self-driving capability in the future through software updates.
Recently, we reported on Elon Musk writing in an email to employees that Tesla is seeing strong demand, but the automaker needs to increase production quickly in order to deliver on expectations.
Last weekend, Musk told employees that Tesla can still achieve the milestone of 500,000 cars in 2020, but they will need to “go all out” with only a few days left in the year.
Electrek’s Take
As we previously reported, at first glance, some might think that Tesla is sending mixed messages.
Elon says that demand is strong, but now, Tesla is adding more incentives to help deliver more vehicles.
The key word here is “deliver.” Tesla is indeed seeing strong demand, but it is trying to give incentives to buyers to take delivery of their cars by the end of the year.
Tesla, unlike other automakers, owns the entire distribution system, and it has a big effect on the automaker’s financials since it can’t recognize revenue until vehicles are delivered, and it spent the money upfront to make those vehicles.
It results in Tesla pushing hard every quarter to reduce its inventory and deliver as many vehicles as possible toward the end of the quarter.
So even if Tesla has the orders in place, sometimes it’s difficult to line up deliveries with buyers due to availability, trade-in timing, or whatever other reasons.
These consistent crazy end-of-quarter rushes are not helping improve quality, but Tesla hopes that it can stabilize things by shortening transit times once it establishes production in Europe and the second factory in the US, Tesla Gigafactory Texas.
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