Economics Profitability of Tesla Model 3 Sedan

Question:-

Illustrate and explain in some detail the profitability of Tesla’s Model 3 sedan.

Answer:-

In the car market, Tesla’s profit margins have increased significantly and they have opened their new factory in China. As a result of the introduction of Model 3, Tesla’s profit has reportedly increased by 32%. Although the Chinese market dropped car sales in their first decade, But the manufacturer managed with the help of new plants. New batteries made by China to increase their potential and increase profit margins per unit. So with the decrease in cost, the Model 3 price has started to decrease. The company is emerging as a more competitive in car market and envious to other firms. As the cost of the battery decreases, so does the price of the battery. As a result Model 3 has become more advanced and production is expanding much more than earlier. Tesla has advanced much faster than many companies and increased profit margins to reduce the battery costs.

Tesla is bringing new house battery production to the market, which will help much more Tesla to grow in the car market. Tesla generated $24.6 billion revenue in 2019. Tesla is also working on solar panel project. Tesla firm has already had a lot of success over the Model 3. This success has been made by providing new vehicle service to the customer and reducing the cost of battery. Tesla’s service centers have sprung up in different locations and they are offering a lot to the customers.