Published on May 31st, 2019 | by Maarten Vinkhuyzen0
The Tesla Models Europe Needs
May 31st, 2019 by Maarten Vinkhuyzen
In a previous article, I wrote about the disappointing competition for Tesla vehicles — namely, the Jaguar I-PACE, the Audi e-tron, and the Mercedes EQC. These are all great electric cars, but especially considering German Autobahn standards, they are city cars. Not the go-anywhere, do-anything cars that were expected from these traditional automakers. I still have high hopes for the Porsche Taycan and the Polestar 2. The Porsche might be in a different price class, but who is counting? The conclusion I came to is that the competition is no real threat to Model 3’s demand, yet.
After the competition problem, I evaluated the sales problem. That is a lot more serious. Tesla was for years very careful not to create too much demand it could not meet, opening only enough dealerships in the small markets of Norway, Switzerland, and The Netherlands, and to a lesser degree the UK. The rest of Europe was hardly able to order a Tesla Model S or X.
With the Model 3, Tesla will get enough supply. The opening of dealerships all over the EU should make it easier to satisfy the demand. Our Polish colleagues (including the director of CleanTechnica) have to travel to Berlin to service their Model S’s and X’s. Not many people are willing to accept such an inconvenience.
The next matter is accommodating typical European demand.
The European market is slightly different from the USA market. In the USA, half of the market is pickup trucks and such. And that is also nearly the world market for that type of vehicle. In Europe, we buy station wagons instead. Tesla is developing a pickup for the American market, and I think it should also develop s station wagon for the European market. Further, the towing should be as good as with a Ford F-150 pickup, at least.
We should have a Model 3 sedan, a Model 3 SUV (aka Model Y), and a Model 3 station wagon. The last would likely be the best selling version of the Model 3 in Europe. The idea to build global models is nice, but we don’t have a global taste. Some models will only sell in high volume in a single market.
The pickup will sell in North America (perhaps a million a year?) but hardly at all in the rest of the world. The station wagon will sell in Europe (perhaps a half million or more) and a few hundred thousand in the rest of the world. For China, there needs to be the Long (L) version — those who can afford a Tesla can also afford a chauffeur. They want more room in the back. In India, we can expect a similar preference.
Different weather and climate, and different economic and social patterns, create market demand for different car body shapes.
There is another difference in the usage patterns. Europe is more densely filled with cities. Most distances are too short to fly, so they are often driven or people take the train. It is quite common to drive 50–200 miles between cities for family or business visits. The average time a car is owned by a driver is 3 years for new cars, and 4–5 for cars over a decade old.
The first owner often drives more than half of the total miles that will be on the odometer by the time the car is retired. Of course, the first owner is the one who decides what options and perks are worth getting, what is needed and what is not, and the first owners drive far more than the average owner later in the life of the car.
For the new car buyers who only drive 5,000 miles per year, that is often something like 500 trips of 2 miles and 4 trips of 1,000 miles. The car is bought for those 4 trips. The car is only used for those 500 short trips because it is handy and available. Otherwise, the person often could have walked, biked, or taken the bus or tram.
It is a misconception that Europeans don’t need range simply because the average mileage per car is low. There are many older vehicles that are mostly used as city cars, but new cars are mostly bought for their traveling capacity.
Range, especially for the market Tesla is operating in, is probably more important in Europe than in the United States. Remember, as well, that Europe suffers much longer and colder winters than most of the USA. To really compete with the Audi and Mercedes offerings in Europe, a Model 3 station wagon with a 110 kWh battery and 5,000 lb of towing capacity is what the market demands. We should have no doubt that Franz von Holzhausen can make a beautiful station wagon, or “shooting brake” as the more luxurious are often called.
A Model S150D station wagon that can compete with the Mercedes E-Class, Audi A6, and BMW 5 Series, the most popular station wagons of Europe, is probably asking too much. It would be seen as an abomination of the elegant lines of Tesla’s top-of-the-line model. But Europe could really use a Tesla station wagon of some type.