Tesla is a company that continue to make headline whether its stock reaching record highs and becoming most valuable car company in the U.S. or its autonomous driving technology, Many people are excited to know more about Tesla owner’s experience.
Usually the first reaction when people come to find out I drive a Tesla is you spent 6 figures on a car, how much money are you making? The average price of a Tesla back in 2016 is indeed 6 figures, but that doesn’t mean all Tesla owners pay that much. In fact, I only paid $71,200. Model S 60: $66,000 (MS 60 is no longer available) Enhanced Autopilot: $5,000 Destination and Doc fee: $1,200 Referral credit: -$1,000 Total cost including tax and registration: Free lifetime supercharging
Since I lived in California, the federal tax credit and the state rebate total come out to be $10,000, so in reality the cost of my Tesla is closer to $60,000. I do plan on keeping my MS for 8 years (when the battery and drive unit warranty expire) and drive around 20,000 miles a year with the gas saving the total cost is under $50,000. Which make the price closer to an Acura RLX, Mercedes-Benz C-Class and BMW 5 series.
Up until 2015, I still see news articles that stated how Tesla owners able to save money though tax credit, gas and maintenance, but in reality no matter how you do the math Tesla is a premium luxury car unless gas price jump to $7/gallon, the cost of ownership will never be cheaper than an Accord, Camry or Prius. Yes, you do save money on oil changes and other maintenance associated with internal combustion engine (ICE) cars, but unless your car needs a weekly oil change you will never break even comparing Tesla to non-luxury ICE.
By taking a detailed look at tax incentives, charging, maintenance, insurance and repair cost along with EV experience potential Tesla owners can get a clear understanding of the total cost of Tesla ownership.
My Model S only lasted 1.5 years before a total loss, accident (Big rig overturned on the freeway). After more than 35,000 miles during that 1.5 year the insurance payout for the total loss is over 61k. The total sale price is around 81k, therefore if you take out 10k incentive (Federal and CA) after 1.5 year and 35,000 miles it only depreciated 10k which is better than what anyone can ask for. Using Teslanomics fuel saving calculator (https://teslanomics.co/tesla-model-3-fuel-savings-calculator/) 35,000 electric miles in California is close to $3000 cheaper than gasoline cars so for the 1.5 years of ownership the cost come out to be $7000. According to carfax (https://www.carfax.com/blog/car-depreciation), new car lose about 10% just in the first month of ownership so 10% lose over 1.5 year on a high mileage car definitely exceeded all expectation.
The sad part is the Model S price had gone up since the MS 60 is no longer offer and instead I got a Model 3.
Tesla Sticker Price (5 ways to save money on a Tesla)
The first thing that comes to people’s mind in owning a Tesla is the sticker price, the cheapest configuration for a Model S is close to $85,000 while for Model X the cheapest configuration is over $90,000. There are a few known discount and saving available. The $1,000 off referral credit is no longer available instead, buyer will get 1,000 miles (2,000 if order by 10/1/19) of free supercharging. With supercharger cost 0.28 per kWh, the estimated value of 1,000 miles of supercharger credit is about $100. For a limited time, Tesla is giving 5,000 miles of supercharger credit if you order by 5/28/19.
There is also a showroom and inventory discount, in the past usually those are more fully loaded model which might not help potential buyers who’s buying a lower end model. With Tesla production ramp, people are reporting discount even for slightly used based model including Model 3 possibly for customers who took advantage of the generous return policy.
The destination/doc fee $1,200 can be waived, Tesla run special promotion from time to time and based on Tesla forum posting owner advisor can waive a limited number of buyers. There is also end of quarter promotion that waived the fee.
If you are trading in, try to negotiate a trade-in quote from Tesla before ordering or confirmation. I was able to get Tesla to up their offer by more than 10%, the owner advisor can help you negotiate with the Tesla trade-in team. You should provide KBB value and other add-on/modification you have done to justify the higher offer.
Lastly, most of the owners/potential owners are probably wanting some Tesla gears, if you order in the store, they do give you some free Tesla swags (hat, shirt, etc.).
Lastly, be patient, unlike other car manufacturers Tesla adjusted their price lower over time like the Model 3 even taken into the tax credit depending on the configuration, it could be cheaper during the first quarter push in 2019 then buying it in 2018. Even upgrade, like the Model S and X software limited 60 to 75 and full self driving features had gone with significant discounts that's thousands of dollars cheaper. Tesla will always announce a price increase weeks ahead of time, but price reduction happens overnight without notice.
The bottom line is there isn’t much room to reduce the sticker price. Based on feedback from Tesla forum even for those where Tesla didn't build the car according to order with missing features (Ex. no automatic rear liftgate) at best owners received free annual service or extended warranty as a compensation but no discount was given.
Certified Pre-Owned (CPO)
A couple years back most used Tesla sell close to what a new one would cost, but now as more inventory hit the market and Model 3 is now widely available. The price had dropped quite significantly. Tesla actually is now selling quite a number of CPO below $35,000 with people grabbing one for less than 30k. Previously, there is hardly any CPO under 60k. In the past many had mentioned how Tesla was able to retain much better resale value compare to other EV and even ICE but as Tesla constantly updating its price and options, plus HW 3.0 (autonomous driving hardware) coming out buyers should be aware Tesla might not hold value as well as previous studies show.
Unlike other car manufacturers, Tesla tightly control the CPO market because when you purchase from Tesla you get either 4 years or 50,000 miles or 2 years, up to 100,000 miles warranty plus 24 hour roadside assistance. The warranty discourages many from buying through a private party. One thing to keep in mind regarding CPO (Model S and X only) is the new owner received the remaining battery and drive warranty which is 8 years infinite miles, but for the original 60 the coverage is only 125,000 miles. Before you place an order for the original 60 make sure to check with Tesla because battery replacement might end up costing more than the car.
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