One of the joys of shopping for a new car is knowing that the price you see on the window sticker is just a starting point for negotiation.
It’s exciting to see how far under that MSRP your sharp negotiating skills can get you. Two thousand dollars? Four thousand? More?
Of course, the flexibility of the dealer depends on a lot of factors. Is the car in high demand or has it been sitting on the lot for months? What kind of kickbacks does the manufacturer offer? Is the vehicle a high-priced luxury pickup or an economy car?
Whatever the vehicle, consumers rarely find themselves paying the full MSRP.
That is, of course, unless they’re buying a Tesla.
Since Tesla doesn’t use third-party dealers, it’s free to price its vehicles however it wants and stick to a non-negotiable cost. That’s one of the ways the electric automaker has managed to keep values high.
Late last month, however, Tesla CEO Elon Musk caught wind of some salespeople offering discounts on non-discountable Teslas.
The wrath of Musk ensued.
According to numerous sources, Musk learned of these discounts happening from a Reddit post, which said a buyer wouldn’t get the promised discount if he didn’t take delivery by a certain date.
Musk then said,
There can never — and I mean never — be a discount on a new car coming out of the factory in pristine condition.
Musk is right. Giving discounts to customers without any valid reason weakens the integrity of the company and reduces the perceived value of its vehicles. Other automakers have to deal with the fact that their cars are worth what people will pay for them. Tesla gets to decide what its cars are worth and still gets people to pay for them.
Once discounts start, though, that formula can disappear really quick.
Tesla has been able to rebel against traditional auto sales methods and succeed. It doesn’t use a dealer network, it doesn’t negotiate, and it hires its own sales staff. With Musk keeping a closer eye on sales prices, you can bet that you won’t be getting a deal on a brand new Tesla anytime soon.
Buyers looking for a deal can still wait for a floor model that’s been used for test drives or search the used market for their dream car.
Does the non-negotiable nature of Tesla sales prevent you from buying one?
-tgriffith
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