How do You Get to a Lower Price?

When a manufacturer creates a product the margins that are experienced are important. The margin is where all the bills get paid, the people get paid and the profits come from. In order to ensure the feasibility of this with products, studies are conducted to come up with the cost of production along with the price that item needs to be offered for sale. In order to lower a selling price or create higher margins for the items being produced, a manufacturer has to find a way to lower the cost of production.

This is an idea that’s as old as trading products for money, but the ability to lower the price of production happens by either finding a facility that can do the job for less or by building more of an item. When Henry Ford created the first assembly line that helped produce more cars per day than ever had been done in the past, he was able to sell his cars for much less than they had been offered previously. Tesla has announced they are now able to offer one of their models for a lower price.

The Tesla Model X 75D is the SUV from Tesla that is now being offered for a price that’s $3,000 less than it was in the past. This means the Model X is now offered at a starting price of $79,500 which is only $5,000 more than the Model S luxury sedan. While these prices are still in the upper area of the market, the fact that Tesla has lowered the price without being required to is certainly an excellent way to offer this model at a bit of saving over the previous price that was charged for this SUV.

The reason Tesla has been able to lower the price is the fact they have now achieved a more efficient process and can now produce the Model X for a bit less than they were able to in the past. These new savings are being offered across the lineup with some added inclusions that used to be sold as extras. The Premium Package for the Model S P100D and Model X P100D used to cost an additional $5,000 on these models and now it is being included and a spoiler can also be added to either one without any additional cost for the vehicle.

Not only will offering the base models of the Model X help boost sales for Tesla, but this package that was chosen by most of the customers that purchased these range-topping models chose the Premium Package. By adding these items to the P100D models as standard fare help to simplify the manufacturing process for Tesla, which aids in the overall production. As Tesla moves forward to become a manufacturer that’s offering volume sales that will take it from being a boutique automaker to a serious competitor in the market, we should see even more price reductions or packages added as standard fare in the vehicles produced.

 

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