3 Possible Selling Points for Tesla Motors Inc.'s All-Electric SUV

Could Tesla's next new vehicle give the company two blockbuster successes in a row?

Jun 7, 2014 at 2:00PM

At Tesla Motors' (NASDAQ:TSLA) annual shareholder meeting on Tuesday, CEO Elon Musk said the company's Model X is on schedule for production to ramp up in the second quarter of 2015. But investors who have been following Tesla closely for the last few years are well aware that the latest roadmap for Model X production was originally scheduled as early as late 2013. After waiting so long, investors certainly have high expectations for the SUV. Can Musk & Co. deliver?

Model X

Model X. Image source: Tesla Motors.

Analyzing the Model X value proposition
The Model S isn't outselling all other comparably priced luxury cars in North America simply because it's electric. Tesla went far beyond that, making the large sedan compelling. There is little doubt Tesla executed expertly on building an attractive value proposition into the Model S. Consider the vehicle's exhaustive list of 2013 accolades, including a 99 rating on a 100-point scale from Consumer Reports.

The Model X, too, will need to offer an all-around compelling value proposition to get customers to pay an estimated starting price around $75,000. So, beyond the obvious selling points that come along with any Tesla-branded vehicle (like ditching gasoline forever, free long-distance travel, and lower maintenance costs), what other features could help drive sales?

Style
First and foremost, Tesla clearly wants to make the vehicle "pop." Design is incredibly important to the U.S.-based young auto company, and Tesla wants to hit a home run on that front with the Model X.

Radical styling undoubtedly begins with its "falcon wing" doors.

Model X Falcon Wing Doors

Model S (left) and Model X (right). Image source: Tesla Motors.

Bit Tesla asserts the doors are about more than style. "[T]hey're functional first," Tesla says. "Falcon Wings open up and out of the way, in even the narrowest of parking spots. You easily step, not climb, into Model X."

Musk says Tesla is taking a no-compromise approach to the design, insisting that the production version of the SUV will "blow people away." In fact, the production version of the Model X looks better than the pictures of the vehicle available now, Musk told investors on Tuesday.

And like the Model S, the space in the Model X is startling. When Tesla first debuted the SUV, seven grown men stepped comfortably out of the vehicle. Then, of course, there is Tesla's signature "frunk," or a trunk where an internal combustion vehicle's engine usually is. The frunk adds convenient storage space.

Performance
With either a 60 or 85 kWh battery and Tesla's dual motor electric powertrain, which delivers instant and powerful torque, the SUV will outperform the fastest SUVs and many sports cars, according to Tesla. The Model X Performance version gets to 60 mph in less than five seconds.

Model X Dual Motor Powertrain

Model X base. Image source: Tesla Motors.

Further, with its dual motor setup enabling all-wheel drive, combined with the low inertia in the all-electric drivetrain allowing for nearly instantaneous response in the vehicle's traction control system, the Model X will likely be among the best performing SUVs in the snow.

Safety
Then there's the many safety features that will likely carry over from the Model S -- the safest car ever tested by the National Highway Traffic Safety Administration. Features like the vehicle's low center of gravity (thanks to a battery built into the floor of the vehicle) or its unparalleled front crumple zone (thanks to the nifty frunk).

Tesla could also debut partially autonomous driving with the Model X. Musk told investors last week that Tesla owners will be able to go "from highway on-ramp to highway exit without touching any controls" in "less than a year." The timing suggests Tesla may be planning to debut the feature alongside the Model X launch.

Sure, there may be other key selling points beyond these three. But these factors alone help build a convincing value proposition for the SUV. Given Tesla's excellent execution on the Model S, investors shouldn't doubt Musk & Co.'s ability to pull off another blockbuster vehicle in the Model X.

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Daniel Sparks owns shares of Tesla Motors. The Motley Fool recommends and owns shares of Tesla Motors. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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