HomeLatest ThreadsGreatest ThreadsForums & GroupsMy SubscriptionsMy Posts
DU Home » Latest Threads » MichMan » Journal
Page: 1

MichMan

Profile Information

Member since: Mon Apr 20, 2015, 05:44 PM
Number of posts: 2,909

Journal Archives

Would-be Tesla customers wait, wait for their cash back

Detroit News -Daniel Howes

How long could Detroit’s automakers get away with sitting on $1,000 deposits from customers tired of waiting, waiting, waiting for their new electric car?

Not very long. The likes of General Motors Co., Ford Motor Co. and Fiat Chrysler Automobiles NV would be accused of using the cash as interest-free financing to fuel their operations. And the allegations would be directionally, if not literally, correct.
They would be pilloried — by investors, by regulators, by the news media, especially by would-be customers. Any constituency accustomed to calling BS on sketchy tactics would smell more of a money grab by a financially stressed startup than the defensible actions of a crisply run company.

But not Tesla Inc.
The Silicon Valley-based automaker controlled by Elon Musk is slow-walking requests for refunds, Bloomberg News reports. Customers tired of waiting for the company to deliver a legit $35,000 Model 3 compact as promised several years ago say they are being forced to wait as long as six months to get their cash back.

Starting in 2016, Tesla booked hundreds of millions in individual $1,000 deposits eager to get their hands on an affordable Tesla intended for the masses. But the folks who can't afford the upscale versions of the Model 3, much less the flagship Model S, mostly are left to wait, wait, wait because Tesla needed the cash, cash, cash it could book from building higher-priced Model 3s first.
The double standard is stunning, if entirely predictable by now. Flouting common business sense is a core principle of Musk, whose iconoclasm attracts investors, boosts the company's market value and raises a simple question: How long can this kind of stuff go on in one of the country's most regulated industries?

It's yet another example showing how the rules are different for the global auto industry's pre-eminent startup. Its CEO regularly spurns industry convention; its senior management churns repeatedly; its manufacturing quality evokes more Detroit circa 1980 than Silicon Valley 2019. And Tesla mostly gets away with it.

When Tesla sits on nearly $800 million in customer deposits at the end of last year, according to Bloomberg, and continues to assemble a record of customer-service complaints, how long before regulators start asking about what's going on? Customers already are.

What they may lack in brand cachet could be offset by the quaint notions of dependability, the ability to more easily get parts and timely service, and the assurance that it wouldn't take six months to get a customer deposit returned because the automaker couldn't keep its end of the bargain.
Doing what you say you're gonna do still matters — and it should.

[link:https://www.detroitnews.com/story/business/columnists/daniel-howes/2019/02/26/tesla-customers-wait-wait-cash-back/2982332002/|

Go to Page: 1