Tesla’s Cybertruck now starts at $60,990, which is 50% more than the initial estimate
December 1, 2023 – 12:44 AM UTC
(Reuters) – Tesla’s (TSLA.O) long-delayed Cybertruck will be priced starting at $60,990, over 50% more than what CEO Elon Musk had touted in 2019 and a cost analysts have said will draw select, affluent buyers.
The truck, made of shiny stainless steel and shaped into flat planes, is partly inspired by a car-turned-submarine in the 1977 James Bond movie “The Spy Who Loved Me,” Musk has said.
Its new body material and unconventional, futuristic styling has added complexity and costs to production, and threatens to alienate traditional pickup truck buyers who focus on utility, experts say.
But Musk, who has priced the vehicle’s three variants between $60,990 and $99,990, said on Thursday the Cybertruck has “more utility than a truck” and is “faster than a sports car.”
He drove a Cybertruck onto a stage to cheers from the crowd and later handed over vehicles to about a dozen customers at an event in Austin, Texas.
“Finally, the future will look like the future,” he said about the truck’s design, showing a video of the Cybertruck towing a Porsche 911 and beating another gasoline-powered 911 in a short race.
Tesla shares fell 2% in extended trading after closing off 1.6% at $240.08.
Musk did not announce the vehicle’s prices at the event, but Tesla’s website listed the prices. Its highest performance variant, the ‘Cyberbeast’ will be available next year, as will the all-wheel drive trim that starts at an estimated $80,000.
The cheapest rear-wheel drive version with an estimated starting price of about $61,000 will be available in 2025.
“This is going to appeal to … definitely a wealthier clientele that can afford the price point and they want something that is unique and quirky,” said Jessica Caldwell, head of insights at auto research firm Edmunds.
“That just isn’t a large segment of the population that can afford that especially where interest rates are.”
After Musk estimated in 2019 that the Cybertruck would sell for $40,000, the vehicle drew more than a million reservation holders who put down $100 deposits. He had not offered an updated price before Monday, despite rising raw material costs for EVs.
New deposits are $250, Musk said on Thursday.
The price is not a surprise to many, said Paul Waatti, an analyst at consultancy AutoPacific. Waatti told Reuters before the event that the Cybertruck would do well with a smaller audience.
GRANDSTANDING SHOWPIECE
Cybertruck, two years behind schedule, enters a hot pickup truck market to compete with the likes of Ford’s (F.N) F150 Lightning, Rivian Automotive’s (RIVN.O) R1T and General Motors’ (GM.N) Hummer EV.
Rivian’s R1T has a starting price of $73,000, while the F-150 Lightning starts at about $50,000. The larger and more powerful Hummer EV pickup costs more than $96,000.
The Cybertruck, Tesla’s first new model in nearly four years, is critical to its reputation as a maker of innovative vehicles. At a time when the company is battling softening electric vehicle (EV) demand and rising competition, Cybertruck is also key for generating sales, though not to the extent of the company’s high-volume Models 3 and Y.
Musk tempered investor expectations about the product last month citing problems in ramping production and warning that it would take a year to 18 months to make it a significant cash flow contributor.
Ahead of the launch, Musk captured media attention on a different subject, giving a profanity-laced interview to the New York Times on Wednesday. He cursed advertisers who left his social media platform X, formerly known as Twitter, because of antisemitic comments.
On Thursday, he said about the truck: “It’s basically an incredibly useful truck. It’s not just some grandstanding showpiece like me.”
UNIMPRESSIVE RANGE
The Cybertruck’s longest-range version can drive an estimated 340 miles (547 km), and comes with a “range extender” or extra battery pack that extends its range to 470 miles.
In 2019, Musk had said the truck would be able to travel 500 miles or more on a single charge.
“As a truck, the Ford and Chevy are more useful and certainly easier to see out of,” said Sam Abuelsamid, principal research analyst at Guidehouse Insights.
“Given that Teslas almost always fall short of (range) estimates in real world driving by anywhere from 10%-20%, I wouldn’t expect the longest range version of the Cybertruck to achieve more than 300 miles on the road,” he said, noting that the Chevrolet Silverado EV is capable of exceeding its 450-mile rated range.
Musk has said Tesla was likely to reach a production rate of roughly 250,000 Cybertrucks a year in 2025. He did not update that on Thursday.
During its 2019 reveal, Tesla’s chief designer Franz von Holzhausen took a metal ball to demonstrate the truck’s unbreakable “armor glass” window, only to shatter it.
Holzhausen on Thursday lobbed a baseball at the Cybertruck window that bounced off.
Reporting by Akash Sriram in Bengaluru,
How does the higher price of the Cybertruck compared to initial estimates impact Tesla’s target market and potential sales
Tesla’s Cybertruck: A Luxury Pickup for the Affluent
December 1, 2023 – 12:44 AM UTC
After several delays, Tesla has finally announced the pricing for its highly anticipated Cybertruck. Starting at $60,990, the price is over 50% more than what CEO Elon Musk had initially promised back in 2019. This elevated cost has led analysts to predict that the Cybertruck will only appeal to a select group of affluent buyers.
The Cybertruck, made of shiny stainless steel and featuring flat planes, draws inspiration from the iconic car-turned-submarine in the 1977 James Bond movie “The Spy Who Loved Me,” as Musk has previously stated. However, the unique body material and unconventional styling of the truck have added complexity and production costs, potentially alienating traditional pickup truck buyers who value utility.
Despite this, Musk maintains that the Cybertruck offers “more utility than a truck” and boasts impressive speed, even surpassing that of a sports car. During a recent event in Austin, Texas, Musk drove the Cybertruck onto the stage to cheers from the crowd and handed over vehicles to a dozen customers. He emphasized the futuristic design, showcasing a video of the Cybertruck towing a Porsche 911 and outracing another gasoline-powered 911 in a short race.
Following the announcement, Tesla’s shares fell 2% in extended trading. Although the vehicle’s prices were not announced during the event, Tesla’s website listed the starting prices. The highest performance variant, known as the ‘Cyberbeast,’ is set to be available next year with an estimated starting price of $99,990. The all-wheel-drive trim, starting at an estimated $80,000, will also be available next year. The cheapest rear-wheel drive version, priced at around $61,000, will be released in 2025.
Jessica Caldwell, head of insights at auto research firm Edmunds, believes that the Cybertruck is likely to appeal to a wealthier clientele that seeks a unique and quirky vehicle. However, she also acknowledges that this segment of the population capable of affording such a vehicle is relatively small, especially considering current interest rates.
While Musk initially estimated the Cybertruck’s price to be $40,000 in 2019, the vehicle attracted more than a million reservation holders who put down $100 deposits. Despite rising raw material costs for electric vehicles (EVs), Musk had not provided an updated price until recently. New deposits for the Cybertruck now require $250.
According to analyst Paul Waatti from consultancy AutoPacific, the Cybertruck’s higher price was not surprising, as he believes the vehicle will find success with a smaller, more niche audience. The Cybertruck enters a competitive market, going up against Ford’s F150 Lightning, Rivian Automotive’s R1T, and General Motors’ Hummer EV. Rivian’s R1T starts at $73,000, while the F-150 Lightning begins at approximately $50,000. The larger and more powerful Hummer EV pickup costs over $96,000.
For Tesla, the Cybertruck represents its first new model in nearly four years and is crucial for maintaining its reputation as an innovative vehicle maker. As the company faces declining electric vehicle demand and increasing competition, the Cybertruck is expected to contribute to sales, although not to the extent of Tesla’s high-volume Models 3 and Y.
In conclusion, Tesla’s Cybertruck, with its higher-than-expected pricing, is likely to attract a select group of affluent buyers who appreciate its unique design and advanced features. While it may not have the mass appeal of Tesla’s other models, the Cybertruck remains an important addition to the company’s lineup and reinforces its commitment to innovation in the automotive industry.
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