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Comment by legitster | Hacker News Reader

It is hard to describe exactly the niches they are trying to fill with the designs. I don't see the Y suddenly appealing to someone who didn't already want an X or Y or 3. The differences between models borders on what other companies would consider trim levels.

They are only cannibalizing the same market, as opposed to producing a pickup or a hatchback or a van on the same chassis. Are they limited by tech or capital? Or are they really attached to an idea of what a perfect car is and have trouble extending the vision?

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Tesla is just being sensible here, given the dynamics of the car market.

Point 1 - the car market is shifting heavily to sell more SUVs. (For some reason) buyers are preferring them to traditional saloons. [1]

Point 2 - as a result, many car manufacturers have a range of SUVs, which absolutely cross over with --and cannibalise-- their saloon options. For example:

* Audi has the Q3, Q5, Q7, and Q8

* BMW has the X1, X2, X3, X4, X5, X6, and X7

* Mercedes has the GLA, GLC, GLE, GLE coupe, and GLS

All of these are SUVs, and all of them cross over with other (saloon) models from the manufacturer.

If Tesla wants to sell more Model 3-sized cars to consumers, it needs a small SUV alongside the Model 3. This is just good basic sense, on their part.

[1] https://qz.com/1344537/by-2020-suvs-could-make-up-50-of-us-c...

Does this extend outside the US car market?

VW in Spain has like 4 or 5 different SUVs

VW Group has a vast number of SUVs models - must be nearly 20? (Skoda, Seat, VW, Audi, Porsche, Lamborghini and Bentley all have SUV models).

All three of those companies are German and sell even more models in their domestic market than in the US.

I'm not challenging the existence of the cars, I'm asking if the global car market reflects the US market as in the citation. I'm especially interested if it applies in China.

Looks a touch more complex in China:

To the surprise of many in the industry, sedan sales in May leaped up by 12.1 percent on the same period last year to 940,000 units, while the SUV segment seemed to lose momentum, growing 6.5 percent year-on-year to 761,000.

The SUV segment had retained a much faster growth rate though when the first five months this year were combined. Its sales grew 11.7 percent from January to May to 4.22 million while sedans rose 4.8 percent to 4.73 million in the same period.

"It is understandable that SUV sales growth has slowed a little bit after years of surging ahead," said Xu Haidong, an assistant to the association's secretary-general.

[1]http://www.chinadaily.com.cn/cndy/2018-06/25/content_3644501...

Yep:

The SUV market segment showed the strongest growth in sales. [1]

[1] https://www.theicct.org/publications/european-vehicle-market...

You forgot about the Audi Q2.

TIL a "saloon" isn't just an old time bar but also a synonym for "sedan"

I have a 2004 Forester XT which is fast (beat all 3 $40k sports cars reviewed in the same magazine in 0-60 times), handles great (for a SUV), and has enough cargo space to be quite functional. The AWD system is great in the snow, and it has enough clearance to handle even pretty serious storms... (assuming plows are going anyway).

Sadly Subaru has abandoned the fast, but practical market. No WRX hatch, no turbo Forester, and the Crosstrek is very slow. The CVT is horrid as well.

Model 3 is small, low, and fast. Great as a second car, but not something I'd want as the primary car for a family + dog. I would not want to cross the Sierras in a snow storm with under 6" of clearance.

So the model Y fixes all my issues with the 3. A bit larger (smaller than an X though), a bit more clearance (by the looks anyways), and has generous cargo room. All while being as easy to park/drive as the smaller cars like the model 3.

I have the 2008 Forester XT. What a great car! But the Model Y looks like the next car for me too since I need to be able to tow my small boat.

The new Ascent will pull 5000 pounds, and it's only 37K pretty much loaded. You'll get 400 miles to a tank and you can pick it up tomorrow. Unfortunately the price point just isn't quite there yet for these things to make it worth the extra cash just yet. Electric is still a luxury good, but I'm hopeful for the future.

Looks like it will pull very close to 2000lbs max. Those CVT's really suck when it comes to towing.

https://www.subaru.ca/WebPage.aspx?WebSiteID=282&WebPageID=2...

The units on that page are in kg. The Ascent Touring pulls 2270 kg, or ~5000 lbs.

Yup - base trim pulls less, but the 37K touring ups the towing considerably.

FWIW, I've found CVTs are pretty straightforward for towing things at the right weight while on the road, but admittedly might tow less then a more conventional transmission would get you. I love the gas mileage improvement though. 30+ on the Outback, reliably (highway)

I would like to see one of the YouTube car review channels take the Model Y on a very milkd 'off-road' course.

Not a real off-road park, but one of those loops the manufacturers put together, for cars like the Honda Pilot or the non-Wrangler Jeeps.

Tons of capability in a modern car is determined by the traction control system and whether they tune it to stupid proof the handling for snowy roadways or tune it to try its best to make the car put power to the ground no matter what.

Without knowing the temperament of the electronic nannies it is very hard to bench race the off road capability of modern all wheel drive vehicles.

I'd like to see someone actually off road the thing and see what it can't do so you know what its limits are rather than zip around a rally course and sing praise which is what most YouTube reviews do.

This is a really good video of 3 Tesla models on an Alaskan testing ground, and compares nannies off vs. nannies on, along with "normal" vs model 3's "track mode"

https://www.youtube.com/watch?v=xbaNQQaFrnE

Also a Subaru fan here eying the Y very strongly.

Price points! I’ve wanted an X for years but it’s 120k if I buy it here. This is half the price. It’s the first affordable family car from Tesla.

I'd like something roughly the size and price of a Model 3, but with a bit more storage space. I'm never going to buy a Model X unless I find myself suddenly wealthy or a used one comes up for sale remarkably cheap. I think this makes a lot of sense.

X is too fat for Europe and China. Y is perfect.

Still looks a bit too big to be practical in European cities.

It's about the size of a new BMW 3-series, which is definitely practical in European cities.

> Or are they really attached to an idea of what a perfect car is and have trouble extending the vision?

A problem is batteries.

You can make an ICE van or light pickup on a car frame, with different gearing and a bigger gas tank, trading acceleration and top speed (which no one ever reaches in most cars in practical use) for utility, and it's not a big deal because of the energy density of gasoline, and because neither the body nor the gas tank is all that expensive.

With a Tesla, what you have to scale up to keep useful range is the batteries.

Another problem is brand image necessary for the viable price point; a hatchback would probably be doable, but hatchback and luxury aren't things that necessarily fit well together (they aren't I possible for brands that have the association with luxury firmly established, but with Tesla already getting plenty of fit+finish flack, why do something that reinforces a pedestrian rather than luxury image?

Aerodynamics are also probably a significant issue: the design of Tesla vehicles, including the SUVs, look like they are staying very close to aerodynamic ideal, which makes sense because their is a notable effect on efficiency and hence range; this has been common with EVs back to the EV1 era. This gets back to the battery issue.

Not disagreeing with your larger points, but the Model S is a hatchback, though it doesn't have that image.

I don't understand what you have against hatchbacks.

Seems to be a standard opinion in the US for some reason. Hatchbacks are more practical for urban or close suburban settings but for some reason don't fit the American image. VW is releasing its ID small hatchback anyway, which is going into production at the end of 2019, start of 2020. That's in fact more than a year ahead of even the Model Y production schedule. The ID looks like it will have a good range and pricepoint, more than 200 miles for $25k-30k. If Tesla wanted that market it looks like it's already passing them by.

I don't have anything against hatchbacks, in fact, every car I my wife and I have had except two more than a decade ago have been hatchbacks.

Perceiving the US market to view hatchbacks as conflicting with luxury of not having a thing against hatchbacks.

The Y definitely fills a niche: a $40k SUV. The S, 3, and X are all either not SUVs or not anywhere near $40k.

I'm sure that's why they're trying to dig a more visible trench between the two levels by removing the jump seats and lower cost versions of the model S. They seem to want a sedan and an SUV, with a premium luxury version they can push new semi-experimental technology into that hasn't yet been proven in the industry as sustainable at scale, and then the more accessible models that leverage economies of scale from the successful bits of the higher end vehicles.

I guarantee that once the big rig version is making money, they're going to start making the smaller inner-city delivery vehicles using similar tech.

> Are they limited by tech or capital?

Tesla is limited by capital at the very least.

I highly recommend the Tesla episode of the "acquired" podcast: https://www.acquired.fm/episodes/2018/7/16/season-3-episode-...

The same people who are saying Tesla are cannibalising the same market, are often the same people who are saying that there is significant competition from other car makers incoming ...

As someone who will be buying an EV in the next two years, the Y has certainly kept me interested in Tesla. It looks much better than the 3.

IDK if this is the logic, but it might be:

From day 1 (elon's "underpants plan"), Tesla's what-to-build-next strategy has focused around a few pieces: (1) The current and near future cost of a long range battery (2) Market size at various price points. (3) Using unit volume to drive battery cost reduction and open up new categories.

Mostly, they've selected the highest volume categories where their electrics compare favourably on price performance (and performance-performance) with high-ish-end ICE cars.

For the first car, this meant expensive sports car. Then, luxury sedan...

ATM, the $40k-$50k price range is the highest volume price segment where you can afford a good battery without performance or range compromises. At that price range, SUVs of various sizes are very popular. So, even small-ish differences in price and/or product opens up a bigger potential customer base.

A lot of people “want” a model 3, but “need” an SUV / seating for seven. The Model X is also beyond the reach of 95% of the market.

Also, it’s not canabilizing if the margins on the Y are substantially higher.

I thought it was entirely about price. Making similar cars that cost a bit less each time. They’ve always been clear about that strategy.

Seems to me that the model X is a saloon car, while the Y is a fastback. Don't most car manufacturers make cars of both types?

> Seems to me that the model X is a saloon car, while the Y is a fastback.

The Model X, Model 3, and Model Y all have continuously sloping roofline to the rear edge; all are fastbacks.

The X was trying to be some sort of exotic with its price tag and ridiculous doors.

The Y is more aimed at middle-class soccer moms IMHO.

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