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Buying A 2012 Tesla Model S: Pros & Cons Of 'Tesla Way' To Order


At last, my number's been called.

As the holder of reservation number P 717 for a 2012 Tesla Model S, I've waited more than three years after putting down a $5,000 deposit on the sleek, all-electric sport sedan.

Since then, Tesla has kept my interest percolating with e-mail updates and promotional swag, including a coffee mug, a T-shirt, and a remote-control Roadster model.

But last month came the news I'd been waiting for: my production slot has been scheduled, and it was time to place my order and specify the color, battery size, and options I wanted. Delivery is slated for November or December.

The ordering process I've just gone through spotlights the ways in which the Tesla car-buying experience differs from the traditional one.

Tesla Motors [NSDQ:TSLA] has no franchised dealers, but rather a network of  factory-owned retail "stores,"  typically located in high-end shopping districts and malls.  (Their resemblance to Apple stores is no coincidence;  Tesla hired George Blankenship, the guy who led the design and placement of the Apple stores.)

Introductory presentation at 2012 Tesla Model S

Introductory presentation at 2012 Tesla Model S

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Tesla's vehicle service centers will be separate from the stores.

The primary purpose of the stores is to introduce casual passers-by to the Tesla brand, educate them about the cars, and direct them to the company website. The sale and delivery are handled on-line from company headquarters in Palo Alto.

In my case, the stores played no role in my buying decision; I was hooked long before the first Tesla store even opened.

With the arrival of the "It's Time to Build Your Model S" e-mail, I had 30 days to finalize my order without losing my place in the queue. I went to the online configurator, selected my colors and options, filled out some basic personal info, and pressed the send button.

After a couple of phone conversations with a young, helpful Tesla product specialist to smooth out some online bumps, I signed a Pre-Delivery Motor Vehicle Purchase Agreement.

And that's where it stands today.

Based on my experience so far, the Tesla system has its pros and cons.  Among the pros:

Less sales pressure.  A lot of people hate dealing with  car salesmen, who have an often-deserved reputation for deception and high-pressure sales tactics.

For these buyers, the online sales approach will be a welcome relief. (Although Nissan has ended its attempt to sell the Leaf this way, handing the car over to dealers to sell conventionally.)

It's possible to buy a Model S without ever setting foot in a Tesla store. Based on the two stores I've visited, if you decide to visit one, the atmosphere will be friendly and low-key--offering info displays, interactive design-your-Tesla screens, and samples of interior fabrics and colors.

There will also be an actual car or two. But the prime role of Tesla store representatives is to educate the customer, not to close the deal. No surprise; they don't get commissions on the cars they help sell.

No price haggling.  The price you see on the screen is the price you pay. Again, for people who hate the traditional car-buying process, this is a welcome relief.

Six 2012 Tesla Model S cars at

Six 2012 Tesla Model S cars at

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Delivery to your door.  A Tesla rep will deliver the car to a location of your choice. I'm specifying my own driveway, but one early customer reportedly asked that his car be delivered to Disneyland. "Wherever makes you smile," says Blankenship.

However, based on my experience so far, there are also some downsides to the Tesla system:

Not enough cars to look at.  Two big decisions I had to make were the exterior body color and the interior style and color. Tesla's online and in-store configurator shows a pretty picture of a car in any available color, and with any of the various interiors. But a picture on a screen is a long way from the real car.


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Comments (24)
  1. Having gone through a similar experience, I was a bit floored by the "feature creep" that occurred when configuring my Model S, too. I opted for the 40KW base model, but could not resist the tech package. A Model S without navigation seemed incomplete to me.
     
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  2. Wow. You have confirmed my decision to not invest in Tesla.
     
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  3. Right because who wants to invest in a company that is able to up sale $20k in options! Where's the money in that??
     
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  4. Everyone would want to invest in a company that could "up sell" options. Options and trade ins is where traditional manufacturers and dealerships make their profits. Investors want profits.
     
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  5. Yes my tongue was firmly in my cheek ;)
     
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  6. David, thanks for a comprehensive view of things that most of us were aware of only in general terms. I think your perspective is helpful and balanced and look forward to hearing more about your experiences once you get your car.

    It will be gerat to get actual production vehicles in the stores, though, since many people will not be fans of buying a color one hasn't even seen yet in public. Not a huge issue for many, of course, but buying an unseen-in-person car might be tough for some. I'm personally not a fan of the outside service side of things, but it's not a dealbreaker, just something that I hope eventually changes.
     
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  7. The stores have vehicles on display.
     
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  8. Oh, and the idea is you can schedule a test drive too, although it is now not yet possible I believe.
     
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  9. Anne, perhaps you missed this in the article but David noted that the Tesla stores he visited did not have production interiors. I experienced the same thing when I visited a store in San Jose recently. Due to lack of space, limited exterior colors to see in person, too.

    Not really a huge problem & I know Tesla will get production interiors in the stores over time, but when it comes to 2015 & I'm considering a Tesla Model S/X, I'd obviously want to see all this in person and Tesla isn't quite there yet. But again, a minor inconvenience only for most buyers. Tough for some people in areas with no dealers, though, and I went out of my way to visit the San Jose store while visiting the area.
     
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  10. I congratulate you on your decision. I agree it's frustrating that there are not enough cars available. I'm sorry to hear you didn't get the panoramic roof, I've seen it, it's amazing, and definitely worth it. The leather was also an excellent decision.
     
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  11. I also had selected the green for my order, but upon seeing that color at the "Get Amped" setting, I found it much too dark. It is almost an "olive green" rather than "British Racing Green," which would have been my hope also. We are switching our order to the pearl white upgrade, at least at this time, but we do not expect to take delivery until around July 2013, so maybe there will be other options by then.
     
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  12. Nice article. I am a Signature Performance reservation holder who upgraded from the Signature I ordered a couple of years ago. The person I spoke to at the store in White Plains told me that the national company that will buy my car will be able to structure the transaction so that it is a trade in - which saves me about 8% of the trade in because the net of the two cars is the amount that I will have to pay sales tax on. From what you are saying, it sounds like this is not the case. Do you know?

    And, you've got to get the moonroof. It is absolutely huge and it gives the rear passenger more headroom, whic his one of the few design flaws.

    Thanks!
     
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  13. It seems to be a bit much to ask from a start up car company to have every colour and every technical set up available in every showroom. In my experience no car dealer can offer that sort of service, certainly not for their more exclusive models.

    No trade in...Tesla needs to really make sure this third party they set the customers up with offers fair deals. It's their reputation on the line.
     
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  14. Dealerships, in general, make most of their profits on under valuing customer trade ins. Chris, you would be better off privately selling you car or use some one like "Auto Traders Guarantee Price" to sell your car.
     
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  15. Though I do agree that an overly pushy salesmen can ruin the buying experiance I still prefer dealerships. Simply because they can take care of anything you need car wise in one location. Dealers can show you the car, take you on a test drive, give you brochures, they take trade-ins, they sell accessories, they service the car and some have body shops. A dealership can handle all aspects of your car and I do think it's important to experiance a car in person before you give them a single dime. But I do like the stores aswell, when I'm in one it reminds me of being a kid in a toy store. I'm scheduled for a late September early October test drive of the Model S and will probably leave a deposit on the same day and it will be done at a store.
     
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  16. FYI. A traditional dealership will often mark up a hot new car from $10-$25K. Recent examples: Miata, new VW Bug, MB Gullwing, 240Z and my favorite...2005 Ford GT at $100K over MSRP. Tesla will either service your car at their service center or send a Ranger to your home/office to service your Tesla. I have seen, driven, and I am a reservation holder of the only 21st Century car on the market.
     
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  17. Yeah I know I've seen them temporarily mark up hot selling cars. These markups can be avoided but some consumers will actually pay more just to be the first person in their city to be seen driving the latest and most talked about cars. And yes I know about both Tesla's service centers and rangers. I'm waiting for a test drive because I never buy a car I haven't test driven. FYI, I am a long time car enthusiast, but I don't see anything powered by gasoline as modern anymore only hybrid and electric cars are truely new or 21st century.
     
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  18. If you try buying a Maserati Quattroporte, I doubt you get to see the full range of interiors or colors and you pay a truck load for a car that plummets in price the moment you drive out the show room. I'd rather go with the Tesla Model S as in my opinion it represents better value for money. Also servicing costs for the Tesla will be cheaper than the Maserati.
     
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  19. Actually most showrooms have color samples, Maserati has both paint and leather samples just like any other exotic brand.
     
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  20. I consider the no-haggle fixed price one of the best things about Tesla's marketing. I hate haggling, but in the auto industry it is required. I spent several hours on my last purchase and had to get up to walk out twice before they would even discuss a discount. The problem is that you know there is built-in room for discount and if you don't get it you got suckered. A good barginer may feel proud of his skills, but his win comes at the expense of someone else's loss. I like to know I am not paying more than anyone else.
     
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  21. **Part 1 of 2 (or 3)**

    SHOCKED! You're a journalist and should be well-informed, yet you appear to have no clue on what you're doing. Let me try to compress 20+ years of activism into a two minutes:

    1. Our parents lied to us. Their parents lied to them. We were told, "Eat your meat, it's good for you." This is a lie. It's been promulgated by the USDA for decades for the financial interests of the American farmer and ranchers.

    See:

    www.forksoverknives.com

    2. Why does this matter when it comes to leather in your next automobile? Because the argument goes, "Well, if we're eating the cows we may as well use the whole thing." Leather is actually a "co-product" of the meat industry:

    http://www.idausa.org/facts/leatherfacts.html
     
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  22. **Part 2 or 2 (or 3)**

    http://www.idausa.org/facts/leatherfacts.html

    Leather

    While many people think it is cruel to kill animals for their fur, leather remains a popular consumer item, even though both products require the killing of animals. Most consumers mistakenly assume that leather is merely a by-product of the meat industry, and that buying leather clothing does not increase the number of animals slaughtered. However, this belief ignores the economic interdependence of factory farming and the leather trade.
     
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  23. **Part 3 of 4 (or 5?)**

    In reality, leather is a co-product of the meat industry, generating significant profits for both factory farms and the leather trade itself. In fact, without the lucrative sale of animal skins for leather, factory farms would not even be able to turn a profit by selling meat alone. Ultimately, buying leather products subsidizes factory farms while providing financial incentive for them to produce more leather.

    **Also, and this one is important**

    https://secure.peta.org/site/Advocacy?cmd=display&page=UserAction&id=3993
     
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  24. **Part 4**

    Reality: no one looks in the mirror and says, "I am an evil person because I ______." Instead, we place blinders on our eyes-and our minds-and perpetuate the lies told to us by our parents, if not by actually speaking them but in how we act and live our lives. It's easier that way.

    "Men occasionally stumble over the truth, but most of them pick themselves up and hurry off as if nothing ever happened."

    Sir Winston Churchill
    British politician (1874 - 1965)

    The only reason things ever improve is because activists, "troublemakers," point out truths that are uncomfortable. But, eventually, enough good moral people change their choices because of those truths. Please, change your Tesla order to the non-cruel interior. Thx!
     
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