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Tesla and Musk Use Ingenious Trick to Get Buyers to Pay More

Tesla and CEO Musk have a clever way to entice buyers to pay for an expensive feature.
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If you order a new vehicle today, you really can't know for sure when you'll get it. The reasons are clear: the supply-chain disruptions and the shortage of semiconductors during the pandemic. 

The situation has further deteriorated since Russia invaded Ukraine. This conflict caused a surge in the prices of crude oil and in raw materials like nickel, aluminum and palladium.

The three elements help make catalytic converters, air conditioner condensers and other essential car parts. Nickel is used to make the batteries, which are the heart of an EV because they determine a car's range and play a key role in the performance and the security of the vehicle as well.

No surprise, then, that vehicle prices have increased, and more particularly the prices of electric cars. 

Tesla  (TSLA) - Get Free Report Chief Executive Elon Musk has prepared his customers for this bitter swarm. 

"Tesla & SpaceX are seeing significant recent inflation pressure in raw materials & logistics," the CEO tweeted on March 13.

A few days later, Tesla raised its prices between 3% and 5%.

Which Is More Important: Price or Delivery Date?

Apart from this price increase, current and future Tesla customers, like many other consumers who want electric vehicles, must be patient. 

That's because while carmakers have full order books, suppliers are struggling to keep up production. Delivery times have therefore been extended. In addition, consumers can't go to rival carmakers because all of them have the same problem.

So the prices for cars, especially electric ones, become less important than the delivery times. And Tesla and Musk understand this very well.

Tesla no longer gives precise delivery dates. The group gives you an estimate, which suggests that the company may not meet the deadline. For example, if you right now order the Model Y long-range SUV, with a base price of $62,990, you will get it only between October 2022 and January 2023.

If you today place an order for the entry-level Model 3 long-range, the delivery period is June to August 2022. The base price is $54,490. 

Now, these waiting times can be significantly reduced to a maximum of seven months. But there's a catch: To shorten delivery times, customers must add the company's premium full-self-driving assistance system at a cost of $12,000.

When you choose the FSD option, the delivery time reduces from June to August 2022 to May to July 2022 for the Model 3, for example.

For the Model Y SUV, the delivery time is shortened to between June and September 2022 compared with October 2022 to January 2023.

To be sure: The FSD feature enables Tesla cars to execute maneuvers on their own, but it does not make these vehicles autonomous, Tesla warns and reiterates. "The currently enabled features require active driver supervision and do not make the vehicle autonomous," the company has said.

Some smart buyers have managed to get around this trick. Since the FSD capability is just software as opposed to a physical piece that must be installed, some customers ordered the driver assistance system option, and then canceled it just before the vehicle's (shortened) delivery date. 

Of course, Tesla seems to have discovered the maneuver and acted to close the loophole. The FSD capability can be removed from a current order. But for new orders Tesla has added a message clearly stating that removing FSD once it is ordered will delay delivery.

"Your Model Y comes standard with autopilot and has been upgraded to full-self driving," Tesla warned. "Removing full-self-driving will delay delivery."