If the idea of owning a Tesla appeals to you but your budget is screaming, “NO WAY,” how about a $35,000 model that will seat five and offer a range of over 200 miles? That is Elon Musk’s claim for the just revealed Model 3. A high efficiency electric motor provides zero to 60 acceleration in less than six seconds and the car will be available with all-wheel drive. Production will begin in late 2017, but one must remember Tesla has had a hard time in some cases meeting such deadlines. Is the idea of a Tesla for the masses a good idea? The company already has at least 130,000 pre-orders at $1,000 each for a car that is at least a year and a half away. More technical specs will follow at a later time.
This is the day automakers report on what are expected to be robust March sales. We will have an update for you a bit later when all of the Detroit three have checked in.
The estimated average transaction price for a new vehicle in March rose 2 percent to $33,666, according to Kelley Blue Book. New car prices have increased by $645 from March of 2015. KBB said incentive spending continues to rise and “to afford the growing monthly payments, more consumers are financing those vehicles for 72 and 84 months, which will likely delay the purchase cycle for their next vehicle.” Fiat Chrysler had the largest percentage increase of the major automakers at 3.3 percent. Yet, average transaction prices were down 4.5 percent at VW.
Echoing those sentiments was J.D. Power. It is calling on the industry to “adopt a more disciplined approach to maintain long term health …” Incentive spending on new vehicles has risen rapidly in the past year and is trending toward recession-era levels for the industry as a whole and has already exceeded recession-era levels on cars, it said. Down the road the increased incentive spending could lead to a decline in used car prices and that would hurt new car sales with interested parties receiving a lower offer for their trade in vehicle.