"I personally think it's a game-changer," said Fool senior technology analyst Daniel Sparks after spending time with Tesla Motors' (TSLA +2.70%) new Model X at one of the company's Meet Model X events.
In the following video, The Motley Fool attempts to capture the new vehicle's unique qualities more comprehensively than any video has yet, and Daniel Sparks explains why the vehicle is so critical to Tesla's business.
Video transcript:
It's electric-car maker Tesla Motors' boldest design yet. Tesla boasts that the vehicle has the center of gravity and acceleration of a sports car, the utility of a minivan, and the styling of an SUV -- all at the same time. The company calls it the "safest, fastest, and most capable sport utility vehicle in history." It's Tesla's Model X.
But will the vehicle live up to the hype? After spending some time with Model X at one of Tesla's Meet Model X events, and observing reservation-holders' excitement about the car, I think it will.
Tesla Model X.
What makes Model X unique?
Obviously, the first feature to jump out about Model X is its falcon-wing doors. It quickly becomes evident that these doors are far more than a gimmick.
Double-hinged, the doors use capacitive, inductive, and ultrasonic sensors to take note of their surroundings in order to open without making contact with objects to the side or above the vehicle. Requiring only 30 centimeters of space, they remain more useful in tighter spots than conventional doors.
The falcon-wing doors also made entering and exiting the vehicle much easier than it is for a traditional SUV. Not only was it possible to step in and out of the vehicle without hunching over, but the third row was much more accessible.
Then there's Model X's enormous front windshield, which Tesla claims is the largest of any automobile. Extending from the front all the way to where the rear door frame begins, front passengers are greeted with expansive openness.
Beyond these two features, which arguably stand out the most, Model X is equipped with a range of other stand-out features, including auto-presenting and auto-closing doors, a row of three individually adjustable "monopost" second-row seats, which leave plenty of room to store items underneath them, Tesla's signature 17-inch touch screen, and the vehicle's industry-leading driver-assistance technologies, which essentially enable Model X to steer itself on the highway with an occasional check-in from the driver.
Then, of course, there's Model X's incredible 0-to-60 time of 3.2 seconds for the fastest version of the vehicle, or a still impressive 0-to-60 time of 6 seconds for the entry-level Model X.
And don't forget that this vehicle is electric. With between 220 to 257 miles of EPA-rated range, depending on the battery configuration, it's the only fully electric SUV available for purchase in the entire world.
Of course, all of this technology doesn't come cheap. Model X pricing starts at $80,000.
The SUV is critical to Tesla
It's impossible to overstate the importance of this vehicle to Tesla. With production and deliveries of Model X only just now ramping up, Tesla is anticipating the SUV's deliveries will help it boost its annual sales from about 50,000 Model S in 2015 to a range of 80,000 to 90,000 Model S and X combined this year.
The vehicle's production ramp also comes at a critical time for the company. With Tesla set to unveil its lower-cost Model 3 on March 31, and begin delivering the vehicle in late 2017, the flashy SUV serves as somewhat of a marketing ambassador for the company's brand -- a halo product.
Furthermore, with Tesla anticipating Model X sales to grow to rival Model S sales, gross profit generated from the Model X sales will play a key role in helping fund the development and production ramp of Tesla's upcoming Model 3. Given Tesla's huge ambitions to grow annual vehicle sales to around 500,000 by 2020, led by its Model 3, it will need every dollar it can get from sales of its S and X units to begin laying the significant groundwork required for such a bold vision.
For now, demand for Model X is robust. Tesla has garnered about 35,000 reservations for the SUV without showing it in stores or advertising it anywhere. And based on Model X reservation-holder reactions at test-drive events, the overall sentiment among Tesla's growing list of customers waiting for the vehicle appears to be optimistic. Tesla said in its most recent shareholder letter that Model X reservations were converting to orders at a faster rate than Model S reservations were when it was first launched.
The challenge for Tesla now will be to ramp up production to satisfy demand for the vehicle, converting a backlog of reservations into actual orders. Reported Model X sales throughout the year, as well as management's commentary on demand for the SUV, will definitely be a narrative worth watching during 2016.
It's difficult to say how well Model X will continue to sell. But personally, I think it's a game-changer.
