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40's Need a Fix

Lots of folks who've waited faithfully for a long time, and committed to an MVPA for a 40kWh car, and now are justifiably hurt to hear production is delayed again, while noob 85's get their cars quickly.

This gripe is legitimate - TM has made business decisions that have the effect of stringing along 40KW reservation holders. (Even if that wasn't the intent).

I think TM needs to mend fences with them. Here is my suggestion:

If you have a 40KW reservation and signed an MVPA, TM will refund your money on request, but grandfather in your option to purchase at the original price when the 40 starts production.

This would be a good faith gesture to credit supporters who've loaned them money. I think it would fix the problem and reaffirm folks' faith in the company's decency.

What do all of you think?

(Please note your res type in your post).

While 40's should certainly now be given the right to exit, mbergman's point is valid that for most who want their cars, it is ultimately unsatisfying after such a long wait. It also would drive some to cancel out of sheer frustration.

There should be some material consideration for TM promising dates to get MVPA signatures, and then choosing not to make good on them.

I don't think you should fix one problem by making another. 60's paid full price, so free upgrades from 40's to 60's seems really inappropriate.

TM might instead give folks a choice to receive some extra equipment at no cost, or some credit toward the cost of switching to a 60.

That would show genuine some empathy and good faith, and goes to the spirit of setting his right.

Based on Musk, what he's done before, his statements, and stated beliefs, I am of the opinion that Tesla has hit a technological flaw that is preventing them from bringing the 40 kwh battery to production as fast as they expected too. This does NOT mean they AREN'T going to do it. As I understand, and as others have noted, their DOE loans REQUIRE them to be able to supply the 40 as part of their available lineup.

Make no mistake, Elon WILL find a way to deliver. He has in the past, and he will do so now. As the saying goes "Rome was not built in a day". I have faith that Elon will find a way. I think others should as well, but if you find that you can't, I suggest you cancel your reservation, and walk away.

Your choices are clear; choose, and act.

Vawlkus - Their architecture scales very nicely. I very much doubt they hit a technical snag, and I am very confident they will produce the 40.

There is much technical evidence supporting this conclusion.

The engineers at TM are as good as they come, and the 40 will not humble this crew who so artfully executed the far more challenging P85.

You'd be surprised Mark. I only have to deal with 4 different power systems at work, and each one is scaled form one of the others, and each one can give some REALLY irritating problems with appalling ease.

I do agree that Tesla is a good group, but we need more info before we can make any assumptions here.

Vawlkus - Anything is possible, but by that logic the 60 would be riddled with unique bugs. It is not.

TM's architecture is meticulously designed, and scale-dependent bugs are not manifest nor would I expect them to be.

This is about matching the product mix to market demand in real time. It is hard. Any skilled executives in their shoes would have to face it. They have, and I think pretty wisely.

What remains is the matter of those affected, and how they are treated.

And that defines a different dimension of TM's performance.

The progeny of this current play will be either -

a. 1500 people who are chronically embittered, hypercritical of any flaw, and very vocal about it, or

b. 1500 additional staunch advocates who are de facto field sales agents, and defend the company they trust.

That is what's at stake, and its every bit as important as smarter charger science, or the number of stores opened per quarter.

If you make something, a car ... or anything, this is the other place the rubber meets the road.

Don't skid guys.

I was with you till this legalistic nonsense: "If they erred and really believed they could produce the cars, but later determined that they couldn't within the time frame they committed to, then it is still their responsibility to provide a car of equal or greater value to those with whom they have a signed agreement." What car would that be, exactly? A 60 kWh with no options? They are not VW or GM with umpty-two models to make deals with.

All things considered, the Occam's Razor simplest explanation includes none of the conspiracy speculations, and accepts a technical problem warrants suffering the abuse that a delay would cause (is causing) in order to avoid patches and fixes and worse complaints down the road.

Am not going to get into any silly back and forth sniping with anybody, but on the assumption that Vawklus was responding to my previous post, it would seem that he missed the major point, which is that both signers of a agreement have an obligation to fulfill that agreement and that neither should be able to walk away from it without some sort of consequences. And of course our choices are not clear since we don't have any facts pertaining to this delay, so it would be rather premature to "choose and act".

And Brian, I wll agree that that phrase did seem a bit legalistic, which was not my intention. Note that I did not say they have a legal obligation, I said they have a responsibility. I have not now and never have been an attorney, nor have I played one on tv. But yes, some (not me, at least not yet) might feel that a no charge upgrade to a 60 would be appropriate, and I could see their point, which was my point.

+1 sftesla

I think that a firmware limited 60 running as a 40 is brilliant, at least for the pre 2012 reservation holders (2011 and earlier). I don't think it would cost that much extra, because I totally agree that most owners would pay for the upgrade within the first two or three years.

Or Tesla could simply offer these 40 kWh reservation holders a fully working 60, but with special 0% financing for the extra 20 kWh (maybe you pay 2K per year over five years, starting a year after delivery). This way, Tesla's books look better, and I think most customers would choose the option.

That said, I believe the 40 will be produced, and will eventually be more popular than it is now.

Vawlkus: "Your choices are clear; choose, and act."

See this is the problem. Our choices are not clear at all since they have not communicated with us. They have neither confirmed what the Q4 shareholder letter statement means for expected 40 kWh production nor have they told us our options at this point. Can we really walk away now with refund of the $5,000 even though we have a contract locking it in? Maybe so, but they haven't told us that, plus in order to make that decision, I personally would need to know what their current production plans are. If no refund, I will obviously have a harder decision, but it would still be based on their current production plans.

Tesla: please communicate your current 40 kWh production plans and give us our options, then we can all make our choices and go forward. A few days ago, I emailed (actually PM on TMC) this exact request to George B.

The fact that the 40 is not even offered in Europe I think is a strong indicator: It will never leave the factory. As a European reservation holder I too am dissapointed about the entry level being a 100.000 USD bare bone 60 kWh. I think not offering the 40 in Europe will keep away a lot of potential buyers. Maybe even long time reservation holders waiting for a 40. If TM really could build the 40 I see no reason why the sub 100.000 usd segment should not be a target segment in europe.

Mark K - A year delay? I was not aware that you were promised your 40 kWh car before the last US Signature was delivered.

Tough one. I will say this, whatever the internals are at TSLA, they need to make these Q1 13 #'s come he$$ or high water or their whole mission will be in jeopardy. I feel for those who haven't gotten the 40kw battery, but honestly, i just want the co to make it so that millions of people one day can drive ev's sooner rather than later. I support all the companies will to take the risk on this experiment. If you are into ev's you will soon be able to choose a BMW i3 as another shower range alternative. No one EV maker will satisfy the eventual size of this market.

The discussion on this thread has been productive, and aired many different considerations. To progress from talk to resolution, it should be distilled into specific action. To that end, here is a proposed summary:

Synopsis of Problem

Customers signed MVPA's with promises of imminent delivery. TM has since delayed 40kWh production twice, increasing the wait from 3 months to instead as much as a year. 40kWh customers believed they would be served earlier than later orders, but that is not the case. Regardless of the reason for the delay, while the MVPA allows TM to do this, customers feel mislead as a matter of principle. They feel that they took on cost and risk for a benefit that was promised but not delivered.

Form of Resolution

To resolve the conflict, the following elements are suggested:

1. TM emails 40kWh customers this week and apologizes for the delay.

2. 40 kWh MVPA holders can choose from the following options:

a. Exit the MVPA and recieve a full refund

b. Receive a credit toward additional equipment as compensation for the delayed delivery.

c. Receive a credit toward another model if they wish to get a car sooner.

This range of options lets each customer choose what helps them best, and puts choice back in their hands.

TM will need to study what is financially workable for each credit, but this form gives everyone, customer and vendor, a flexible framework for resolution.

Arguments are often complicated, but the best solutions are usually simple.

More rehashing won't improve things. If you want to see this matter get settled, please chime in and tell TM if this form of resolution works. If they have clear data, it's easier for them to act.

Brief, simple replies will help the most at this point.

+1 @ Mark K

I plan to contact George B. directly and will outline some of the points you've made above in my email.

I just went over to talk with a representative at Tesla Service Menlo Park and they were surprised to hear about the delay from me. Go figure.

They still think the 40s will be delivered starting late March and just told me to call the Ownership experience number to get an answer. Tesla might want to prepare their employees a bit more when they make these announcements...

The Site still says Production on the 40's will begin in March.

I talked to my rep just a day after the SH letter and he said he had heard about the delay the same way I did. When pressed, he also said "we can give you a much clearer delivery window the closer we get to your production date..." - that what you told me last time.

For heaven's sake, update the site. New problems are being created by the hour now. That would have been a 15 minute task the day you made the decision. No one was on it.

This entire avoidable problem was caused by communications snafus in the first place. Now, days after the Shareholder announcement of the delay, website visitors still get wrong information, and sales staff are still uninformed. This is more of same of what was ham-handed with the supercharger.

Here we have truly stellar technical achievement presented with less than mediocre communication. It's like seal team six hiring cub scouts for recon. That it is happening yet again is an embarrassment.

There are many companies with very ordinary products who execute much better customer communications than this. Best practices are already well established and widely available. What's up with this?

Not good.

Not for customers, not for shareholder value, and not for TM team members who are working their hearts out to change the world.

Please get on top of this and stop diminishing what you worked so hard to earn.

On the contrary mberg, it IS that simple. Keep your reservation, or cancel. Those are your choices to act on.

Fact is the 60s WERE delivered later than people originally expected. Tesla DID run into issues with the 60s, so it's not hard to imagine that the 40s are having issues as well.

While I agree Tesla does need to improve on its customer communication, and give people reasons for the delay in the 40s, they DO NOT need to do more than that. Freebees and discounts don't come into it until hard dates and contracts come into it. Tesla said they would make the 40s, and they have not said that has changed. Until then, the 40s WILL be made. It's only a question of when.

Vawlkus - I don't believe that's true.

After the initial delay in getting the 85 line started, the 60 was phased in with the originally contemplated offset time. They didn't have problems with the 60, they just stuck to their planned staggering of the intros.

Not sure you have followed the dialog here, but contracts were in fact signed, as early as August 2012, and delivery dates were given, but not kept.

In fact delivery windows were used to induce people to sign contracts early, but those windows were not honored.

It is frustrating to those buyers who have experienced these things to hear others wave them off as nonexistent.

Vawlkus - As said here before, it will not be productive to go back and forth between those with different perspectives, so I will make one last argument for whether the 40s deserve some sort of "compensation".

Some of the 85's or 60's that have recieved their cars, are now happy with the experience and now are only concerned about the well being of the company so that they will be taken care of from this point on.

The 40's have not yet have those experiences and are approaching the point where one of those experiences may never happen, even though some 40's have reserved up to 4 years ago. Those getting their cars now are seen in the public eye as trailblazers, leaders of a revolution. Those getting their cars in the late summer, after roughly 15K cars are on the road, will most likely be seen as followers, not having to courage to step out when nobody knew if these cars were worth the effort, time, or money until thousands had already been driven, reviewed, and proven. I'll bet you won't see any 40kWh owners featured in magaziine or newspaper articles after June like I've seen some of the more recent reciepients. There may never be any recognition that those early 40's deserve just as much credit for the revolution as those that have been driving their cars for the best part of a year.

That experience is part of what I feel I paid for by getting in line ealy and to rob me of that is a realized loss. I will never agree with those that believe the 40's should accept an "I'm sorry" from Tesla and move on. Even if thats what finally happens.

well I cancelled the 40kwh twice and I won't reserve again. I am getting either a Prius plug in or Lexus ct. goodbye tesla. I'll consider tesla again in 10 years when I replace my car.

If you guys are so unhappy you should just ask for your deposit back. Be done with it and move on. You won't get a discount on anything because it would upset those who have been wronged in various ways but didn't get any kind of compensation other than an apology.

George Blankenship just posted an updated in the other 40KWh thread

The shareholder letter was wrong. 3-4 week delay not 3-4 month.

Thanks to those who wrote to GeorgeB. He just posted that production of 40kwh units will begin in March.

Well Crow, if you drove to a restaurant, studied the menu, ordered your food, and then patiently waited an hour for your meal, would you be pleased to hear the following:

"I'm sorry sir, we had to serve some more important customers first and ran out of food. Please come back another day. But good news! There's no charge!"

You would not walk out of there happy, and you'd likely never return.

The implicit error was not telling the diner at the first sign of conflict.

TM's faux pas is about botched expectation management. It can be redeemed with the genuine overtures, which do not have to hurt the company or other customers.

Administered correctly, the suggestions made above can be accretive of revenue, immaterially dilutive of margin, and will maximize the marginal goodwill toward the company.

Beyond which, it is also simply the honorable thing to do.

Just read GB's post.

Hallelujah! Problem solved.

And very clearly now, there was never any technical impediment to release of the 40.

Very happy to hear this, and this thread is resolved.

That's much better. It's all about communication.

Tesla has more in common with a Kickstarter project than GM or Ford at this point.

Patience is really all you need right now.

I can't stress enough how canceling the Tesla S 40kWh will get me back to normal health and well being in my life. Cancellation initiated 2/26/13 11am ET with Raza in ownership experience. This eliminate anymore speculation. Now I'm positive what's in the future. I'm not getting a Tesla S 40kWh due to poor management.

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