Does it matter that Tesla has the best car?
Tesla has the best long range EV car.
They also had, until this year, the only ones.
They happened to be loosing money on this car but
to many that was irrelevant.
To the extent that price is being suppressed, it might not
matter that they have the best car but only the only car.
But the moment consumers can choose it seems what will matter is
, and this is my guess, is by how much better is it than the next best car. But even then, they are competing with themselves
so the Model 3 is a test of whether people value ordinal or cardinal utility in a car, in the short run. Being a long range Ev might cloud the picture, but the reality is Musk has staked his claim on having the best car in both categories of segments. But since he is the only one in that segment, customers picking either the Model 3
or Model S are getting the best car, according to his messaging.
In that case, judging by the income demographic, many of these
will get second cars, but I suspect nearly just as many will take the best car they can afford, though Tesla will lose money on either one. They will certainly lose more money on the lower priced lower margin customer choice.