ST Alpha - "Legitimate Tesla question since I work in supply chain and words mean things. If Tesla is built to order, how is there a backlog that needs discounts" (Reading a Post)

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Legitimate Tesla question since I work in supply chain and words mean things. If Tesla is built to order, how is there a backlog that needs discounts

Posted by Will Hunting (aka JoeMetz) Dec 21 '22, 10:47

Backlog means, I’m contracted to buy X but the products aren’t ready yet. The agreements are made but delivery is delayed due to volume.

So, if I have a backlog of 200k in a build to order company, that means 200k cars are being worked because they were contracted for but are taking time to be delivered.

There is no discounting of those cars because terms have already agreed to before I start building.

If I am discounting to get the purchase, I do not have a backlog…I have an interest list. That’s no different than saying I’d like to be called by a sales rep and wined and dined to be enticed to buy a car.

So, how does a backlog exist in a build to order company that still needs to offer enticements?

Responses:

The backlog is across all markets. The incentives are market specific. -- nm - TWuG Dec 21, 10:58 8
- It's also worth noting that the incentives are meant to keep the lines running at capacity, not to keep them at break even - TWuG Dec 21, 11:08
- December in the US is soft for all auto makers so you get lots of discounts and incentives. - TWuG Dec 21, 11:03 6
  - But according to the Christmas ads, everyone is buying someone a car for Christmas, usually a BMW. -- nm - jnine Dec 21, 11:07 5
    - I think the psychology of this is, since all you got was a robe on clearance, buy yourself something that you want and need. - zeitgeist Dec 21, 11:18 2
      - You need one for your Super Bowl party! -- nm - jnine Dec 21, 11:21 1
        
        *sends you a cease a desist letter for violating their trademark* -- nm - NFL Dec 21, 11:26
    - I keep forgetting to ask about the shiny red Lamborghini I saw in staff parking at the library ;) -- nm - Meg Dec 21, 11:12
    - Deals to remember! -- nm - TWuG Dec 21, 11:09
There are reservations but you are not committed to buy (but I believe you lose the deposit). -- nm - spamlet Dec 21, 10:51
Iirc you put $1,000 deposit when it comes time to build it, months or years from then, they contact you to confirm, and Financials -- nm - zeitgeist Dec 21, 10:50
When it is ready, you have an option to decline the purchase, is my understanding. -- nm - Beryllium Dec 21, 10:48

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Legitimate Tesla question since I work in supply chain and words mean things. If Tesla is built to order, how is there a backlog that needs discounts

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