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Tesla is showing signs of moving away from the ‘no haggle’ sales model


We can all agree that walking into a Tesla store is a lot different from walking into a traditional dealership. From the Apple-like store design, the, generally, passionate representatives, and the overall environment within the shop, it is just a widely unique car buying experience that differs from all others. This distinctive business model is one that earned them the last spot in the Pied Pipers mystery shoppers survey that we reported on last month.

Another prominent theme with Tesla has been the ‘no haggle’ sales interaction that customers have, mostly, enjoyed for the peace of mind that they received knowing that they weren’t being ‘cheated.’ But as of late, quite a few reports from customers have surfaced, possibly, signaling that the company is slowly moving away from a fully straightforward sales experience.

For a while, the California company has strayed away from the traditional dealership business model in favor of a unique experience that excites and motivates customers to adopt a Tesla vehicle on their own volition. Though recently, through our sources and across various forums, Tesla buyers have divulged a few different ways that they are getting additional discounts on their orders signaling that the company might be transitioning to a more negotiable purchasing process.

To begin, the method that most of us are familiar with is the referral program that started about a year ago and is still going strong today. Essentially this program incentivizes existing Tesla owners to ‘sell’ and motivate potential buyers to buy. Owners have a referral code that they can give to buyers that will grant them a $1,000 discount off the total price of their vehicle, whether it be a Model S or X. In return, the owners, in this referral cycle, receive invitations to events, exclusive wheels, raffle entries for a loaded out Model X, or some Tesla swag. At the time of its inception, it was praised for spurring sales and activity within the community and is still, for the most part, viewed in a positive light.

On top of the referral program, via the official Tesla Motors Forums, there is also an inside sales campaign going on calling Model X customers inquiring if they want to upgrade from their 5-seater to a 6 or 7 seat configuration for half-price, along with adding the Smart Air Suspension (SAS) half off resulting in getting the vehicle at an earlier date. What most are speculating is that, currently, there is either a delay in the supply chain or the cost to build out a vehicle with 6 or 7 seats and SAS outweighs the cost to build one with 5 seats and no SAS. Additionally, speeding up the delivery of vehicles by including a couple of add-ons for half-price would mean that the company would be able to take in the revenue sooner rather than later and apply it to the multiple projects they have going on.

Lastly, according to sources close to the matter, some customers are being offered that the destination and documentation fee ($1,200) be waived if they order within a certain timeframe. We are told that Owner Advisors (Tesla’s main salespeople) are limited to a specific number of sales for which they can waive the fees every week.

Again, this is just one more item that, if presented to a prospective buyer, would possibly give them that little extra nudge to finalize their order. It’s certainly more significant than the so far most common Tesla sales pitch of throwing in an extra baseball cap or jacket for free…

Overall, if one were lucky enough to take advantage of all the incentives on a Model X with 6 seats and SAS, then a total of $4,950 would be taken off the price, $5,450 for a 7 seater and a total of $2,200 could be taken off a Model S. This is quite a nice chunk of change discounted from the price given the fact that the only real discount that Tesla has ever given was on their showroom or demo models before the launch of the referral program.

It will be interesting to see how long this campaign will last or if any additions/modifications will take place and how the community takes it. We will be sure to update you on any new information as it comes along!

Disclaimer: your experience may vary. We reached out to Tesla on the matter, but have not received any comments, so we do not know yet whether these discounts are on a case-by-case basis or if it is confined to certain regions.

FTC: We use income earning auto affiliate links. More.

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