Tesla's Model S Plaid could bring in billion-dollar profits for the EV Automaker. Elon Musk has been teasing the next-generation Model S, which will introduce Plaid Model S for a while. The Model S Plaid could raise the stakes for Tesla in the EV industry.
Once the Plaid Model S is released, Gali from HyperChange believes that Tesla could make a profit in terms of gross margins rather than volume. To do this, he encouraged Tesla to set a premium price for the Plaid Model S for undeniably top-grade performance and tech. He concluded that the gross margins for the Plaid Model S could reach as high as 30%-35% for Tesla.
After crunching the number, Gali computed that selling 50K Plaid Model S cars for at least $150K with a 30% gross margin could net Tesla a $2.25 billion gross profit. Tesla could make more than $5 billion in gross profit if it sold 100K Plaid Model S vehicles for $150 with a 35% gross margin.
Credit: Carspotter Jeroen/Youtube
While talking with his co-founders of Third Row Podcast, Gali realized the earnings for the Plaid Model S and Plaid mode might be reflected in Tesla’s potential profits from Track Mode V2 and its Track Package.
Tesla recently announced Track Mode V2 would be coming out in the next update--most probably 2020.8--for the Model 3 Performance. Track Mode V2 would turn the Model 3 Performance variant into a customizable track machine for drivers. It would effectively bridge the gap between daily driver and fun, yet safe, driving beast on the tarmac.
To get the most out of Track Mode V2, Tesla also unveiled its Track package for $5,500. In his video, Gali argued that Tesla fans would undoubtedly be tempted to upgrade their Model 3’s hardware to get the full effect of Track Model V2.
With that said, hardcore Tesla supporters would probably be willing to spend for the Plaid Model S and Plaid Mode as well. Gali pointed out in his video, sales for Tesla’s premium vehicles dropped slightly because of the more affordable Model 3 sedan. However, the Plaid Model S and Plaid Mode could help boost sales for the Tesla S and X vehicles once again.
Thus far, not much has been said about the Plaid Model S. Back in September 2019, Elon Musk stated that Tesla’s Plaid powertrain for the tri-motor Model S was still a year from production.
Plaid mode’s success is tied to Tesla’s improved Powertrain and battery. As such, perhaps it isn’t coincidental that Tesla Battery and Powertrain Day could introduce the company’s improvements to its Powertrain and Battery tech.
Yes. To be clear, Plaid powertrain is about a year away from production & applies to S,X & Roadster, but not 3 or Y. Will cost more than our current offerings, but less than competitors.— Elon Musk (@elonmusk) September 12, 2019
The Tesla Model S has become a legend. It has been said over and over again by prominent hardcore bulls, like ARK Invest’s Cathie Wood, that most EVs now can’t even compare to the 2012 Tesla Model S.
Last year, the Model S was dubbed one of the “Best Gadgets of the Decade” by Time Magazine for ushering in the EV Revolution and a new type of vehicle never-before-seen in the car market. As a previous Tesmanian report noted: “The Tesla Model S marked the beginning of the company’s rise in influence because it dared to be more than just a vehicle. Tesla’s Whitestar was a gadget as well, one that has set the pace for the automaker’s future.”
So the revival of Tesla’s premium sedan could usher in a new era for the EV Revolution and the auto Industry. The Plaid Model S will make history just like its predecessor.
Featured Image Credit: Carspotter Jeroen/Youtube
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Longtime writer and news/book editor. Writing about Tesla allows me to contribute something good to the world, while doing something I love.