Why we should pay attention to Tesla’s maneuver
Commented by Technology & Market analysis expert Morten Gunnerud
Only once in recent history, have we witnessed something close to this
It’s been quite a week for Tesla. In a frenzy of anticipation and interest for their mass-market model, the new Tesla Model 3 unveiled on March 31 received a record volume of reservations.
In contrast to most vehicle manufacturers in history, Tesla has not only managed to capture everyone’s interest, including media, the entire auto industry and consumers, they have successfully converted interest into future customers – receiving more than 325,000 reservations - the single biggest one-week launch of any product ever!
According to Tesla’s own figures, the volume of reservations correspond to about $14 billion in implied future sales – all spread organically and with no paid advertising involved. This is unlike any other major product launches, especially in the auto industry which is known for expensive TV-commercials and marketing campaigns.
Compares to VW Beetle launch
“The Tesla Model 3 unveil is worth paying attention to. Only one time earlier in modern history, we have witnessed something close to this,” said Technology & Market analysis expert Morten Gunnerud.
Between 1938 to 1944, a total of 336,000 people had signed up on a saving scheme (in reality a reservation) for the newly developed Volkswagen Beetle, ready to take part in the next car revolution.
“There was clearly a desire for a cheap, simple car to be mass-produced already more than 70 years back. With more than 21 million built between 1938–2003, the Beetle is the longest-running and most-manufactured car of a single platform ever made – and it changed the history of cars,” said Gunnerud.
It looks as Tesla’s Model 3 is about to repeat the success story of VW Beetle, hence paving the way for a new generation of green vehicles commercially available for the big masses.
Challenging the auto industry
“We are witnessing something completely new in terms of branding and sales. Tesla is not pushing cars through traditional distribution channels. They are sophisticated in the way they handle sales online, adding brand value by continuous software updates in the cars and using different methods in the approach towards customer. This makes them closer to consumer and technology brands like Apple and Samsung, than to competitors in the auto industry,” said Morten.
Even though the excitement around Tesla’s Model 3 exceeded everyone’s expectations, - apparently even Tesla’s own - the desire for a long-range and affordable chargeable car has been much awaited.
“We have seen a growing trend in recent years, that consumer electronic fairs like CES in Las Vegas have become increasingly important venues for the automotive industry due to the growing convergence of consumer and car technologies,” he said.
The great consumer interest in electric and hybrid vehicles was also confirmed during the International Motor Show (IAA) 2015 in Frankfurt.
In Norway, this trend is also supported by actual sales figures. Since 2013, there has been a steady growth of electric and hybrid vehicles. Sales of chargeable vehicles now outpace sales of cars with diesel engines, and already meets the EU legislation’s 2021 mandatory emission reduction targets for new cars of 95 grams of CO2 per kilometre. Mainly spurred by governmental incentives (taxation etc.), making chargeable, and especially electric vehicles cost wise on par with fossile-fuelled vehicles.
Powering up green vehicles
KA’s Interior business provide innovative seat comfort systems and specialized interior components to all major car and seat manufacturers. This includes seat climate and other climate comfort products for electrified vehicles with no or limited access to waste heat from a combustion engine.
What seemed like a new and immature market short time ago, is about to become a new and important chapter in the history of cars. Right now, Tesla is in the driver’s seat for accelerating the transition to sustainable transportation - and we are excited to do our part in enhancing the driving experience!