Tesla (TSLA) Will Stick To No-Discount Policy, Assures Musk
Zacks Investment Research | Sep 29, 2016 07:19AM ET
Tesla Motors, Inc.’s (NASDAQ:TSLA) CEO Elon Musk announced that the company would continue to stick to its no-discount policy and employees should follow the same. Musk’s letter to Tesla’s staff via social-media platform, Twitter (NYSE:TWTR) , came amid reports that employees of the company were offering discounts to customers to meet the quarter-end delivery targets.
Per Musk’s tweet, there were very few cases of such discounted sales worldwide and action to rectify the situation has been taken. While offering discounts is a common occurrence among automakers, it usually implies overproduction and impacts consumer perception. Tesla follows a strict no-discount policy even for friends and family. The company aims to remove the pressure on customers of bargaining with car sales persons by imposing a uniform selling price.
The discount offer from employees supposedly came after Musk urged staff to cut costs and increase deliveries in the third quarter of 2016 via email on Aug 29. Musk intended to generate funding from investors on a solid quarterly performance. The company requires cash to begin the production of a new car model, Model 3, and complete the Gigafactory as well as its intended merger with SolarCity (NASDAQ:SCTY) , which is also facing liquidity concerns.
However, per the mail released on Twitter, the third quarter’s results would only include sales where delivery of the car was completed in the period rather than only title transfer.
Shares of Tesla closed 0.22% higher at $206.27 on Sep 28.
TESLA MOTORS Price
Zacks Investment Research
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.