Tesla Model 3 Critic Turns Bullish
A Detroit-area company that panned the part-by-part quality of Tesla Inc.’s Model 3 electric sedan now believes the car can generate a 30% gross profit margin.
Munro also proclaimed the Model 3’s design too costly to build profitably. But now he estimates a 30% profit margin for the car, considerably better than any other electric car currently in production.
Munro says the Model 3 compares well against such EV rivals as the BMW i3 and Chevrolet Bolt. He says he is most impressed with how well Tesla has integrated the car’s electronics. One example: the Model 3’s auto-dimming inside rearview mirror. He estimates the device costs less than $30, one-third as much as a similar mirror in the BMW i3 and less than one-fifth as much as the Chevy Bolt’s mirror.
Bloomberg News says Munro’s new assessment compares with one done in June by Germany’s Wirtschaftswoche business weekly. It concluded that a Model 3 costs $28,000 to build. Tesla says the car’s starting price will be $35,000, although the cheapest iteration is offers now retails for about $52,000.
Sandy Munro and his team of engineers and costing analysts at Munro & Associates were contacted by UBS Research—an arm of the giant banking and investment firm—and asked whether it was possible to do a teardown and cost assessment of the Chevrolet Bolt EV.
Chrysler pioneered the modern-day minivan more than 30 years ago and has been refining and improving that type of vehicle ever since.
Although the term “continuous improvement” is generally associated with another company, Honda is certainly pursuing that approach, as is evidenced by the Accord, which is now in its ninth generation.