Tesla Retreats When It Should Be Advancing
With Tesla’s lackluster performance in Q1 for EV deliveries, one would think the company would pull out all the stops to stimulate demand. And it has started taking the most basic measure, which is seemingly the only one in Elon’s arsenal: slash prices. Tesla’s Model Y, Model S, and Model X have each been lowered by around $2,000 this month. And Tesla’s Full Self Driving feature has been cut in half for a monthly subscription (from $199/month to $99/month) and cut by 33% from $12,000 to $8,000 for a one-time purchase. Also, the company is offering those with Enhanced Autopilot the option of upgrading to FSD for a one-time fee of $2,000. These price cuts are likely to improve sales and potentially improve the pick-up rate of FSD in the short term, but they are not sustainable. At the same time, Tesla has announced that it’s discontinuing its referral program, effective at the end of this month: April 30, 2024.
Since it was relaunched for car purchases in May of 2023, Tesla’s referral program has proven to be a popular incentive for existing Tesla owners to earn rewards for referring friends and family to the Tesla family. Owners who referred new buyers to Tesla could earn Reward Credits good for the purchase of Supercharging miles, accessories like a Wall Connector (home charging unit), or even software upgrades like the Acceleration Boost which shaves about a half second off the Model 3 or Model Y AWD’s already peppy 0–60 times. The company penalized heavy referrers like YouTubers, influencers and bloggers last June by capping the total number of referrals in a year to 12. As an owner myself, it was a nice perk to get some incentive to influence friends and family to take a test drive and maybe even purchase a Tesla EV.
So, when times get tough, instead of increasing the rewards or incentives in the referral program, Tesla instead kills it. It’s likely the company will claim that this is just another “cost-cutting measure,” but really, it seems more like cutting off one’s nose to spite one’s face. Take your most vocal advocates and take away any incentives they had to spread the love and to counter the FUD. Not a good move, Elon. And here’s why.
Right now, Tesla and the EV market in general are facing what appears to be an organized FUD campaign from adversaries (including those in government and in the fossil fuel industry) trying to convince potential EV buyers of any number of falsehoods in order to slow EV adoption. Not a week goes by when I don’t see another fallacious claim being shared on social media. No, EVs are not, in fact, “worse for the environment than gas cars” (a Tesla contributes less harmful emissions over its lifetime even in places where the grid is powered primarily by fossil fuels). No, Teslas are not “more likely to catch fire than gas cars” (they’re actually 20 times less likely to combust than gas and diesel cars). And no, Teslas are not bad in cold weather (they’re the top selling car in Norway and other countries with cold climates for a reason). People see a claim online which matches their own personal preferences and they blindly share these lies and exaggerations without bothering to check the facts.
The fact is people (for the most part) hate change and love the familiar. And EVs represent a significant departure from the status quo. So give people a reason not to challenge their current choices, lifestyle, and beliefs, and they will happily go along with it. But the threat of climate crisis is real. The destruction of our air quality is real. Our addiction to foreign oil is real. Now is not the time to silence our advocates. Now is not the time to cut costs without consideration of our future. Now is the time to unify and sound a rallying cry. Now is the time to act.
Tesla did toy with advertising in 2023, investing about $6.4 million last year with some videos on YouTube and other social media sites. Yes, that’s “million” with an “m.” Meanwhile, huge brands like Apple and Samsung invest billions of dollars in marketing and advertising per year (billions with a “b”). It’s time for Tesla to start acting like the huge brand it can be by empowering its advocates and investing in marketing, PR, and advertising to counter the mountains of misinformation, lies, and FUD being spread by its enemies. Samsung and Apple know that only by staying top of mind will they continue to lead the way in brand perception. They’re already on top, and they effectively use advertising and marketing to stay there. Tesla needs to do the same if it truly wants to be successful and help to usher in a better, cleaner, safer future.
As a Tesla owner, I do what I can to counter the misinformation and lies I see online with facts and figures. And I encourage fellow EV owners to do the same. But we can’t do it on our own. We need Tesla and other EV makers to get the facts out there about EVs, through marketing, advertising, and PR. Compared to gas and diesel cars and trucks, EVs are safer, better for the environment, more fun to drive, and less expensive to own and maintain. There are so many advantages EVs have over ICE-mobiles that it’s hard to even list them all. But if Tesla and other EV makers choose this moment to retreat and lick their wounds, then we’re all doomed.
Now is not the time to retreat. Now is the time to advance.
Got an opinion? As always, let us know in the comments.
Related Reading:
Tesla Model Y Hits its Lowest Price Ever in the US
Will Tesla’s Slip Complicate EV’s Climb to Mass Vehicle Adoption?
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