Sep 21, 2012
clindsay I am 100% with you, it is not about the money. While many of us could afford to have our pockets picked, I, for one, am not going to smile about it.�
Sep 21, 2012
kevincwelch Tone is important. Word choice is important as well.
Being in the customer service business (sort of), people respond better (and turn around) in my experience if one is empathetic, apologetic, and does what one can to work with the customer rather than suggest that there is something wrong with the customer (as in "stomaching" it). Just my opinion...
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The word of mouth is what I think will hurt Tesla, but I don't know how much it will. It's hard to say how many TMC members will cancel or defer, but what percentage of actual reservation holders is that? 5%? 10%? I think the price point and prejudice against EV are what will hurt Tesla.
I wonder if Tesla ever considered an effort to really please the early adopters with incentives (or whatever) and let the early adopters disseminate the good deeds. I think that would be more potent from a marketing standpoint. The Top 3% of Americans is a small pot, and there's a lot of competition for those members when it comes to automobiles. I believe the PR blunders are going to make it more challenging for Tesla to break into that market.
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If you refer 10 people, can you get a free HPWC? Tesla can have one of those little punch cards like you get at the coffee shop! :smile: But seriously, the whole model of car sales is so radically different with Tesla that incentive programs like this would make sense.�
Sep 21, 2012
mcornwell Looking at the Model S Owners Guide, they list service at 12,000 miles, not 12,500.�
Sep 21, 2012
SteveG3 My response to GeorgeB
I am sending this message in hopes it reaches George Blankenship.
George, I hope you will consider my view of this service contract dust up.
First I want to say I am happily a shareholder in Tesla (hopefully a Gen3 customer one day). I appreciate the effort and risk you and everyone at Tesla are undertaking. I also realize I am on the outside. Among other things, I don�t know the cost of starting a national service center from day one when there are only a few thousand Teslas scattered across the country.
All that being said, to me the service contract plan sounds like a mistake from both a mission and bottom line perspective.
Tesla may or may not have an official mission statement, but I have repeatedly heard Elon Musk say he started Tesla to accelerate the adoption of electric vehicles. I have also recently heard Musk say that what will separate Tesla from the other automakers is that Tesla will never make a bad product. He explained that other companies had allowed a �bean counter� mentality to drive their decisions rather than creating an experience of wonder and delight.
I really think the service contract as offered is headwind to those two objectives (and I think by being responsive to your customers reaction to the plan you have the opportunity to turn it into a tailwind).
Yesterday I read through all the posts on Tesla Motors Club forum since your posting at the start of the week. It does seem your posting has had an impact. My sense is it�s about 50/50 between those who are basically okay with the service plan and those who are basically not okay with it.
I consistently read three points from the not okay camp it is difficult not to empathize with.
Firstly, the low maintenance cost of the vehicle, and EVs in general, has been cited as one of the basic advantages of an EV. Now in year 1, the maintenance cost is $5-600, perhaps comparable to ICE service contracts, but more than most people would pay out of pocket. Beyond being an irritant to those buying the car now (�I thought I�d save $1,200 in gas a year, but now half of that is chewed up in the cost of the service contract�), it leaves an open target of ridicule to detractors of EVs, and implies a credibility issue about the promises of EVs and Tesla. This does not help accelerate the advent of electric vehicles. It does not make for an experience of wonder and delight for customers either.
Second point, having the very people, the early adopters who helped Tesla remain in business, take so much of the hit for the development of the service network. Last I checked, Tesla has $133 million dollars they can use as working capital because these customers put some skin in the game. Additionally, I think they�ve already taken one for the team in the past month. Tesla has been delivering cars out of sequence. This is probably quite beneficial to Tesla to batch the production and distribution of the cars and ask the reservation holders to be patient when they see someone a few hundred reservations behind them get their car first. These customers have taken this hit, when it comes to the cost of service, I think Tesla can step up and take a hit.
Finally, I�ve read of the feeling of being forced into an expensive service contract by the threat of losing one�s warranty. I think for many reservationists they do not simply feel like consumers making a purchase. I think so many of them feel like a part of Tesla, and a part of the advent of EVs. The postings I read strongly suggest the compulsion of an expensive service contract undermines that connection to the company. There is clear reason to have the cars, a brand new product, inspected by Tesla each year. This benefits the owner, but it is clearly a major benefit for Tesla today and as it develops cars for the future. This could be an opportunity to deepen people�s sense of being a part of Tesla�s success by having the car checked on. The cost of the contract frankly replaces that sense with the one of being nickeled and dimed by a faceless corporation which does so simply because they can. Not helpful to the advent of EVs or an experience of wonder and delight.
I told you I think the plan is also off the mark financially.
If Tesla were to drop the 4 year plan by $600 that would mean a drop in cash flow of $3 million in the rest of 2012, if 5,000 cars are sold. At this revised price, on an ongoing basis, for every 20,000 cars Tesla sells it would mean $3 million less in earnings, likely $2 million after taxes, or $.02 eps each year.
What might Tesla receive in return for forgoing $3 million or so in cash flow these next several months, and $2 million, or $.02 in eps for every 20,000 cars sold?
- Vehicle sales. At an $8,000 profit for vehicle, it would take 250 to make up for lost service contract revenue of 20,000 cars at the lower contract rate. Might 1.25% of potential customers walk away because of the cost of the service contract? Perhaps not, but consider how B, C, and D might impact how many look at a Tesla in the first place.
- Free enthusiastic marketing. You have a very loyal enthusiastic following who feel like they are part of Tesla. Could you produce and buy ad space for $2 million for the impact of keeping each set of 20,000 enthusiasts speaking from a point of view of wonder, delight and participation in the progress Tesla represents?
- Protecting entryway to mainstream public. How many fewer mainstream consumers will be opened to the idea of EVs if the media comes to view the lower maintenance cost of EVs as a fallacy? Comes to view the claims in general of EV makers with skepticism?
- Safeguarding Tesla�s first only chance at a first impression. Right now Tesla means progress to so many of us. Isn�t it worth a few pennies in eps to protect that impression rather than falling into �Meet the new boss, same as the old boss.�
Thanks for your time
Steve�
Sep 21, 2012
Trnsl8r Yes, because the purchase price was announced a long time ago and I for one was ready to presume that the advertised "low maintenance fees" could very well be rolled into that price, � la BMW. But the discussed, not-so-super-low, maintenance fees were sprung upon us just recently.
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I'm with you there. Even though I could easily understand TM employees being overworked and this one having a bit of a bad day, wording like that in an email to a customer is unforgivable. Better to leave it unanswered today, get a mug of coffee and answer tomorrow... politely.�
Sep 21, 2012
ckessel Pricing was announced only about 9 months ago. There was a nebulous "around X" number before that. I never really assumed the fees would be much different than the Roadster. I figured less, but not by much (though it's not less excepting ranger fees are different).�
Sep 21, 2012
smorgasbord Now we know that maintenance on the Model S is $0.05/mile. At the usually quoted nationwide price per kWh, fuel for the Model is about $0.04/mile. That's a combined $0.09/mile.
A 2012 BMW 535 gets 25MPG (Fuel Economy of the 2012 BMW 535i). Maintenance/Service/Roadside Assistance is no extra charge. That's a combined $0.15/mile for much of the US.
After the 50K miles are up, Model S has saved you $3000. However, it cost more than $3000 more than the BMW 535i in any reasonable comparison (http://www.motortrend.com/roadtests/sedans/1203_2012_bmw_535i_first_test/). And, that's not including the ~$300 higher destination charge for Model S.
Resale value at that point (4 yrs/50K miles) for Model S is a guess, and may swamp other costs. 2008 BMW 535is with around 50K miles are worth $25K-$30K (about 40%-50% of new), according to cars.com. With V2 or V3 of Model S available in 4 years, its hard to see a used Model S going for more than that.
Tesla's electric drive is great. The touchscreen is cool. But, there's no economical advantage to buying a Model S that I can see.�
Sep 21, 2012
Discoducky I'm going to hope...hope...that by the time the first owners hit 12K miles (as that will happen well before the first year of ownership) there will be a list of the minimum items necessary to NOT void the warranty available for owner or Tesla certified tech that isn't the dealer.
It really pains me to think that I could pay $600 for wiper blades. I'm very worried that all they will do is look at the car and not actually DO anything.
TM Certified tech "Here's your car back",
I'll say "What did you do or find?"
TM Certified tech "Nothing!"
I'll say "#$(%#$%&@$#)%$)%*#$%, thanks see ya in a few months!"�
Sep 21, 2012
kevincwelch I liked your analysis, but I'm not sure there *ever* was an economical advantage. I think if one considers the following other issues, the economic advantage of the Model S dwindles quickly.
1. I think the majority of people here usually buy in the $30,000 range or less -- at least that's my impression
2. Income polls suggest that the majority of people earn <$200,000 annually and have families. These people do not typically buy cars >20% of income levels
3. Polls here and ones I collected show that the majority of people are getting 85 kWh, performance, sig performance, or 60 kWh models. Most are getting multiple options. This is making the car already a $75,000 to $90,000 car.
4. Some people here have openly admitted that they were "stretching" to buy this car
5. Plugging in costs money -- not as much as gas.
6. Maintenance is more expensive than most ICE vehicles in the first 4 years
7. There are unspoken expenses yet to be offered/forced
If you had already planned to purchase a $85,000 car, then maybe there is an economic advantage. Honestly, I think most people are in the market for $30,000-$40,000 cars.
I've never looked at this purchase as something that was an economical decision (I'm not saying that you said this at all; that's just my view.) This purchase is something that is cool, an improvement for the environment, and gets me off of foreign oil.
(Each blog post is making achieving that end a little more frustrating, however.)�
Sep 21, 2012
qwk I think the biggest impact will be showing the car off proudly and telling everyone about it. That enthusiasm translates to sales. I used to talk the car up at any chance. Now I don't ever say anything anymore because it's embarrassing. I'm sure there are hundreds if not thousands that feel the same. Just look at how many cancellations there are here. If the biggest die-hards are not happy, how is the average Joe going to feel? I bet that the cancellation rate is going to be pretty big. Most people can't take one dissapointment after another. Eventually they just give up. I know I'm close.�
Sep 21, 2012
Chregu +1
waiting for the european numbers and we'll see... for the moment: 66% go <> 33% nogo�
Sep 21, 2012
ckessel Right, but I don't think that has much impact on future reservationists. The current ones are getting hit with something they didn't expect (or not at this cost level) and that's a morale blow that has an impact beyond the dollar value.
New buyers are coming into a known situation, no surprises. I don't think they'll blink much at it. Had I just looked at Tesla for the first time today, it's just be part of the cost factor. It's possible that $2000 would tip things if I were at the edge of my cost vs. value proposition, but otherwise it wouldn't have much impact.�
Sep 21, 2012
RDoc New reservationists though have to be pretty inquisitive. If you look at the warranty specs, there's no mention of the service charge, nor is there anything about it in the options. There is a note in the Facts sections that the maintenance should be minimal.
The only place AFAIK that it's mentioned on the website is in the blog, and the fact that it's mandatory is pretty far down in the comments. Despite the discussion of footnotes, there aren't any about the service plan cost, which is a bit off-putting.
There's also been no mention of what is going to be required to keep the battery warranty valid after 50k miles either.�
Sep 21, 2012
ckessel Isn't the same true regarding required maintenance on any car? Well, other than BMW's oft touted zero maintenance thing.�
Sep 21, 2012
Chas F I didn't mean that others would think you had a beater as you drove past them at 60 mph, more that everyone you run into (not literally) will want to see your car and how cool it is but then I can hear "you don't have Nav/leather/sunroof/xxx? My Nissan/BMW/MB/Lexus has all of that. What class car is this again?"
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Agree to disagree. I think this car will be inspected closely because of its novelty and compared immediately to others in its class. I know I would. Especially if trying to decide whether I wanted to get one or not.�
Sep 21, 2012
jerry33 Not to mention that the tires (event the 19") are way more expensive than the tires people are used to purchasing for their $30,000 car. If the maintenance contract included tires (at least for the 19", and perhaps tires at half price for the 21") then I don't think anyone would have a problem with that.�
Sep 21, 2012
polera257
+1
You expressed exactly how I feel. As i said to one of the nicer advocates when I read of the lighting being deleted (visor and rear pillar) tell Tesla to PLEASE STOP TAKING THINGS AWAY!!!!!!! ENOUGH ALREADY!!!!!!!!!!!! Get production going and deliver cars to your followers and they will make many many future sales for you, but you have to treat them right make them feel special!! NOT BETRAYED AND CHEATED That gets around the same as praise. I ask myself why I hate with a passion the oil companies, simple they and the speculators are stealing the people blind. Why? Because they can and what is a person who lives rural to do? Walk 15 miles to the main road and then try to secure transportation in order to get to work. I have said this more than once and conveyed this to the advocate helping me complete my order. I will NEVER BUY ANOTHER GAS ONLY CAR AGAIN! And I wish to live long enough if only by one day to see Tesla and the electric car market kill these bastards where they are choking on the gas. Most likely not gonna happen but that is my wish. Tesla look at how they treat their customers charging what they want because you have little or NO CHOICE!!! People resent being forced to do things and will usually react in the positive when given a CHOICE AND GOOD REASON!�
Sep 21, 2012
Larry Chanin Hi Kevin,
The common thread in Brian's and your responses to my posting is whether to trust Tesla.
So at the risk of displeasing Brian my answer to your question is quite simple. If you don't trust Tesla to do right by you, and if there are unanswered questions by the time you have to commit, then simply defer until you have your answers. It may not take too long to have your answers. No big deal, you've waited this long why not wait a few more weeks if that makes you more comfortable in your buying decision?
In my own case I signed my MVPA a few months ago so I am trusting Tesla. So far I certainly have not been outraged by the details revealed concerning the service plan. In fact I deliberately set my expectations based on the Roadster service plan. As a result I was pleasantly surprised when I learned the Model S service plan is superior to the Roadster's in both costs and features.
To answer Brian's hypothetical question would I have been upset if the service plan was $7,000 every 100 miles, sure who wouldn't, but what does that have to do with the reality of the situation?The reality of the situation is that the service plan is better than what I expected. I set reasonable expectations, trusted Tesla, and wasn't disappointed.
With regard to what some are calling a conditional warranty, I'm buying a very expensive and revolutionary car, why would it even occur to me to risk it by not performing annual maintanence? If I perform the maintanence, why risk the wellbeing on my car to others who do not have the necessary training or proprietary equipment? If the cost of the service plan really doesn't bother you, then don't get hung up on all these discussions on legalisms. Just rely on your common sense. This is probably the most expensive car you've ever purchased, are you going to take shortcuts with its maintanence? If not, all this back and forth discussion is merely academic.
Some people don't have the temperment to trust a corporation. Other people have difficulties setting reasonable expectations. In either case deferal is probably the best course of action. There's no shame in that. We all love the idea behind Tesla, but some of us need to step back...Take a breath...It may be a ground breaking car, but its still only a car. Life is too short to get outraged by a service plan.
I've exhausted all I have to say about this topic, so I hope you won't take offense if I excuss myself from further discussions.
Good luck with your decisions.
Larry�
Sep 21, 2012
kevincwelch Thanks, Larry. You make some excellent points, and I do see the other side of things now. The Model S will be in my garage in 2013, but it will probably be there later than I originally expected (due to deferment). I'd like to see how the other expenses unfold.�
Sep 21, 2012
Beavis Thank you, Larry. Everything that can be said on this topic has been said.�
Sep 21, 2012
RDoc This has been discussed a lot. There is no other car company I'm aware of that requires such a service plan to keep the warranty in force.�
Sep 21, 2012
ckessel I'm really confused because the warranty doesn't require the service plan and I know I saw someone quote other warranties that say basically what Tesla's says. Tesla's wording is pretty generic.
My RX8 Warranty says (this is about warranty on emissions, but wording exists for other areas too):
Those seem pretty similar to me.�
Sep 21, 2012
dsm363 I agree. Tesla is just protecting themselves the same way other automakers do from what I can tell. They're saying if you take the car to someone not authorized to work on it, we don't have to cover something under warranty if we determine either proper maintenance schedules weren't followed or the other service people messed something up. Also, who else knows how to diagnose and fix Tesla's battery systems other than Tesla? While I understand everyone is upset about the cost or the fact that it was announced after many had locked in their order, I don't see how this is really any different than anyone else. The only big difference I see is that there are no other authorized service people other than Tesla.
For such an expensive car, I'm going to follow the recommend service schedule by getting the service prepaid option. Maybe in 4 years there will be other options but I'll still probably stick with Tesla for service.�
Sep 21, 2012
RDoc OK, in the Mazda warranty, which is typical, they say you can have the service done anywhere but if it's messed up, Mazda won't cover it. If it's not messed up, you warranty is still valid.
That's not at all what Tesla is saying. This is from George Blankenship's comment to the original service plan announcement on the Tesla site:
They are saying that even if nothing is wrong and nothing needs to be done to the car, failure to have Tesla inspect it will void the entire warranty. If that seems pretty similar to you, then we have a very different understanding of the word "similar".�
Sep 21, 2012
ckessel The only relevant, legally binding wording is that which is on the actual warranty. As has been noted in prior posts, George isn't the legal department.�
Sep 21, 2012
brianman I think you missed the point of my example.
Suppose I concluded last week (September) that the warranty-conditional servicing was too expensive. I signed my MVPA in June. My only option is to forfeit $10k to "save" $2,400 (first 4 years) + unknown (next 4 years). That's a hell of a way to treat a customer.�
Sep 22, 2012
AnOutsider I also noticed George says its void if you don't do the service, not if THEY didn't do the service... Cleverly worded, or a mistype?�
Sep 22, 2012
RDoc Again from George's comment:
�
Sep 22, 2012
Robert.Boston At the risk of double-posting, GeorgeB explicitly said that he wasn't giving the full legal language. We now have the exact language of the warranty, and it does not say that "You will forfeit your warranty if you do not do Annual or 12,500 mile inspections." Instead, it says:
Thus the warranty coverage may be at risk if your failure to improperly maintain the vehicle causes consequential damage to the car, e.g. increases the cost of repair because a faulty part (e.g. worn brake pad) damaged another (e.g. brake rotor).
The warranty goes on to state:
So, you are certainly putting your warranty at risk if maintenance, service or repairs are done for others, but it doesn't automatically void the warranty, nor could it under federal law. In my state, Tesla is required to provide (at reasonable cost) all the diagnostic codes and tools needed.�
Sep 22, 2012
Beavis The language cited by ckessel is plain, clear and legally what you, as a buyer, are agreeing to. GB's blog post is not binding. The warranty requires that an owner's responsibility is to properly maintain the vehicle. Just like any other car. The only questions are who does it and how much. On the who question, the warranty requires a qualified technician. Right now, Tesla techs are the only ones qualified to work on the car. I think we should be reasonably able to agree with that. You can try someone else or try it yourself but will void the warranty if you or a non-Tesla tech f it up. Just like any other car.
That leaves only the cost question.�
Sep 22, 2012
ckessel It's really unfortunate George misspoke since it's pretty clear there is no legal requirement to have the service done by Tesla. I know some folks were really up in arms about having to have it done by Tesla. Someone earlier cancelled their reservation on the principal of it since he said specifically it wasn't about the money. That's really unfortunate since he cancelled on a principal that's not relevant given the actual wording of the warranty.
Now, if folks want to be up in arms about the cost, that's entirely subjective and I can understand it even if I don't fully agree.
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All those options (Nav, leather, sunroof, xxx) cost far more than the $2000 service. You might give up one of those things. Nav is even free, though turn by turn is part of the tech package.
Saying someone is going to give up $3750(nav) + $1500(leather) + $1500(pano roof) to compensate for $2000 maintenance is some serious exaggeration. I get you were trying to make a point, but the exaggeration then immediately diminished the message.�
Sep 22, 2012
Mycroft ckessel, please explain how the warranty can be maintained if it requires that "all vehicle maintenance and service requirements, including those indicated by the vehicle's systems" be performed --- and the *ONLY* way for those systems to be inspected and maintained is by Tesla service.
Unless Tesla comes out with some kind of a minimum service plan, say $100 every 12k/year for basic minimal drive train inspection service, then I don't see any way around buying the full meal deal and still maintaining the warranty.�
Sep 22, 2012
ddruz Off topic, but since you brought it up: ckessel, Can you please provide documentation for this statement? I'd love it to be true. The information I have gotten on this is that only Internet Google maps are available to assist navigation without the tech package, that there is no GPS installed in non-tech package cars and therefore no little pointer will mark your location on the Internet Google maps. This is different than smartphone Google maps which can in fact be used for navigation. Thus no navigation without the tech package, just static maps.
Please let us know if you have information to the contrary. Feel free to post a reply under "A brief look at the navigation system" thread under the User Interface subforum so as not to stay off topic here. Thanks!�
Sep 22, 2012
ckessel Yep, you're absolutely right. I'm not sure what you're asking me to explain. My point had nothing to do with that. My point is the warranty doesn't require you use Tesla.
In practice though, you will use Tesla because it's a new car from a new company using new technology no one else knows how to service. You had to know that was going to be the case, though I can understand not liking how they're packaging that service (the "full meal" as you call it).
There are two separate concepts:
1) What the warranty requires
2) How Tesla lets you buy service
#1 is the same as every manufacturer, nothing much to see here. If one was going to stand on principle, this would be a poor choice to take a stand on.
#2 I can understand being upset, particularly since at this point in time there is no market other than Tesla for servicing. Maybe in a few years there will be enough Teslas are on the market to drive a secondary service market.�
Sep 22, 2012
dsm363 Other than not bundling in the $1,900 into the cost of the car and making it 'free', I'm having a hard time seeing the problem here. There are some people that have the skills and knowledge to work on their own cars but I'd imagine even they don't have the equipment to work on Tesla's battery pack or other propriety systems. After the 4 years are up, I understand the desire to possibly find cheaper service or do it yourself but within the first 4 years, I agree with ckessel. Tesla is the only game in town for service and will likely be for some time. This probably shouldn't have been a surprise but it appears to have caught some people off guard. I'm not saying people don't have legitimate concerns with effectively being locked into one company for service but that's the reality at the moment.�
Sep 22, 2012
cinergi Food for thought...
George did say
He did then go on to say
But given the previous context and the paragraph about all the disclaimer issues trying to get this posted to the blog, I don't take this literally.
Fact is, nearly everything we've read or been told differs from the actual experience when the time comes. That's why I'm not getting upset. But I'm a Roadster owner and have experience with Tesla. So I can see how those where the Model S is their first Tesla purchase are confused and worried (at best) and angry and canceling or suing (at worst).
For now, I'm giving them the benefit of the doubt. They're awesome people and want to do the right thing by their customers. I know. I've spent hundreds of person-hours with many of them, including the execs. They've never done this before (and that includes getting the communication right).�
Sep 22, 2012
vfx Labor costs only?
ex-EV1Driver
�
Sep 22, 2012
Chas F Apparently you still misinterpret my wording so this will be my last comment on this subject with you. Using your logic that I exaggerated by including all of the options mentioned you would also have to conclude that the other person in the hypothetical scenario owns 4 cars. Obviously my intent was that you pick which option/car may be applicable. I am more than capable of doing the math necessary to offset the service fee, but I am no longer in the mood for a pointless debate.�
Sep 22, 2012
jerry33 I'm not really all that concerned about being locked into Tesla to service the car--it's not like I'd get it serviced anywhere else or even want to given all the positive ratings from the Roadster owners. It's the cost of the required service vs. the perceived amount of service required that's the problem. For the first 50,000 miles, things that go wrong should be covered by the warranty, so even if parts are replaced you shouldn't have to pay extra for it (which is what the maintenance is asking you to do in a roundabout way). Things like bulbs, wipers, washer fluids, and similar consumables don't add up to $600 per year during the first four years. If brake pads are required before 150,000 miles on a car with regenerative braking there is something seriously wrong.
Right now people are feeling upset because a lot of them were expecting a $100 bill similar to a Leaf for the annual service, and not the same price as an ICE car. I wasn't expecting $100 but $475-$600 is similar in cost to maintenance on an ICE car. George B. didn't give any specifics but a maintenance inspection should be plugging in the code reader and comparing the results to the standard, then physically looking at a few areas, and checking fluid levels. I think it's hard for most people to see more than $150 value for that ($250 with the Ranger visit).
There are three things that could have been done to avoid this reaction:
1. Downplay the part about EVs being lower maintenance than an ICE car. If you pay the same in maintenance, then it's not lower. (Of course, it's too late now to use this approach. Expectations have already been set.)
2. Have the maintenance last as long as the battery warranty. That would give a known fixed cost over the period. Because everyone knows that maintenance is likely to be more expensive during the second four years, having an eight year fixed cost would be easy to justify. The "There will be a plan but we're not telling you how much." approach isn't very confidence inspiring.
3. Itemize exactly what is done during the maintenance and how long each is going to take provided there is nothing to replace and also what part of the maintenance is for software upgrades. This one won't totally eliminate the lack of perceived value (because some of the items may come across as unnecessary to most folks) but at least it would show that something is being done other than just changing light bulbs and wiper blades.�
Sep 22, 2012
brianman In my email with Walter, I asked for what this plan would cost me. I see it as a huge value for the 85 kWh (unlimited miles, 8 years).
The answer: "At the moment Tesla does not have an extended warranty. I have fielded this request a few times, it�s usually near the top of my list for customer requests that I send to management."
So they don't even have it available at all (yet?), much less at the current pricing structure.�
Sep 22, 2012
Robert.Boston Hardly surprising that they haven't priced the extended warranty. Tesla Motors has only slightly more information than we do about the long-run maintenance costs of the Model S, so it's actuarially challenging for them to commit to a number now.�
Sep 22, 2012
ckessel I'll admit, you've lost me. I'm not trying to be contrary here, I'm honestly not following why the maintenance costs result in stripped down cars.
Your original post said:
It seemed the gist of your point is people would buy fewer options to offset the maintenance cost. Sure, that seem a very reasonable statement. But the offset cost means only dumping between .5-2 options (depending on option) and I didn't get why that equates to a stripped down car.
Where did I go sideways understanding your posts? Maybe it's a problem of semantics. What do you consider a stripped down car? To me that implies no options (or almost no options) at all.�
Sep 22, 2012
brianman @ckessel - I think the "0.5-2" doubles when you start talking about 8 years instead of 4. Perhaps at that point it reaches "concern" level?�
Sep 22, 2012
ckessel Is Tesla's cost not on par after the 4 year time frame vs. something like a BMW? My understanding is after BWM's free period, it can get spendy later on. Certainly checking various auto sites show non-trivial amounts of maintenance is expected from the 5th year on.�
Sep 22, 2012
Robert.Boston That's been my experience. The question is, will Tesla charge like BMW for years 5-8, or will it offer a significant discount to ICE maintenance? No one knows, including Tesla.�
Sep 22, 2012
ckessel Very true, completely uncharted territory. I know ICE's start looking at things like timing belt replacements, fuel pumps, etc when you hit the 60k-100k marks. I'm not sure what to expect from Tesla (or the Leaf for that matter).�
Sep 22, 2012
jerry33 I'm thinking that Tesla should have as much faith in the car as we are being asked to put into it.�
Sep 22, 2012
brianman Agreed.�
Sep 22, 2012
dsm363 I'm sure they do have faith in the car but no one can predict the future and Tesla is at a very early stage of development where revenue is important. I'd bet the service fee has more to do with cost of building out service centers and hiring Rangers than lack of confidence in the Model S.�
Sep 22, 2012
jerry33 Very likely, but presumably in four years they will be pumping out 200,000 GenIIIs plus the Model S and the new Roadster. Matching the maintenance with the battery warranty now, shouldn't be a financial problem by then and they would have $4000 to $4800 now to support service expansion. For eight years, I wouldn't ask them to lower the price (though I might ask to make it in two payments).�
Sep 22, 2012
MikeK Yes! EXACTLY. Couldn't have said it better.�
Sep 22, 2012
ckessel After mulling the faith bit, I'm at a loss on trying to even vocalize (or, well, type in this case) what I'd expect. I certainly have some nebulous feeling that Tesla should put their money down on the statement EVs have lower lifetime maintenance, but I'm struggling to pick anything concrete to ask for.
A 100,000 mile full warranty seems excessive. They already give an 8 year warranty on the battery.
They should at least match the Leaf, but since I have no idea what the Leaf warranty is they might have already done that.�
Sep 22, 2012
jerry33 In 140,529 miles I've spent $10,030.80 for tires and dealer maintenance in nine years, less one month. (Admittedly this is only one data point, but it's an important data point to me because it's mine). That's 7.1 cents per mile. Tires account for about 25% of that, which makes it 5 cents per mile for the maintenance component. Asking Tesla to provide maintenance equal to the battery warranty would make the costs similar. I don't find the current maintenance price excessive over eight years (that is $4000 to $4800 over eight years). I do find $2000 to $2400 excessive over the first four.�
Sep 22, 2012
Beavis Well, at least we've narrowed it down to the real issue, price.�
Sep 22, 2012
jerry33 I thought price was always the issue. Frequency isn't a problem unless they had made it 3000 miles or something silly like that. Where to get it serviced is just an artifact of the price issue.�
Sep 22, 2012
ckessel Mostly. One fellow cancelled on the principle of being required to go to Telsa as he said "money wasn't the issue", which was unfortunate since it wasn't really the case he had to go to Tesla legally. In practice, yes, since Tesla is currently the only one qualified to maintain the battery/pem/motor/inverter, but that won't be the case forever if Tesla succeeds and ships zillions of cars.
I fully sympathize with the price issue. It's not a huge deal to me personally given what I pay today hence my lack of strong reaction, but I understand folks have different experiences.�
Sep 22, 2012
hcsharp While no one can entirely predict the future, I disagree with your assertion and Robert.B's that Tesla has hardly any more data than we do or that it is "completely uncharted territory." They have a considerable amount of data on the Roadster. They've done a huge amount of testing on the Model S. They can relatively easily predict the reliability of the vast majority of parts. I believe they can predict the cost of maintenance within a reasonable range that is close enough for most projections.
Sounds like you might be starting to understand the points you have missed? Are you at least realizing that you can't compare required maintenance costs to gas powered cars to determine if it's reasonable? You said your expectations were somewhat based on the Roadster. But you can't compare it to that car either due to large differences in service needs. Perhaps you can understand that it makes far more sense to compare it to other EVs. Certainly you can see that charging 6 times more than the Leaf is unreasonable. So if you're "struggling to pick something concrete to ask for", maybe you can start with the Leaf annual service cost like Jerry33 did and add the value of the extra things Tesla is offering like consumables and towing. Those things are not worth a fraction of $600. If you come up with a price that's anywhere near the price of a gasser that requires a lot more maintenance and consumables, then you have obviously gone too far in the other direction IMHO, especially in light of years of promises from Tesla.
We have no choice but to have the car serviced by Tesla. The lack of legal wording that requires this is almost irrelevant because there's no where else to service it (except some work by a few DIY types). That opens the door to price gouging which they have clearly done. The fact that I might be able to afford it does not make price gouging OK. The fact that they didn't add the service cost to the base price does not make price gouging OK. The fact that it's only a little more expensive than a gasser does not justify it. The fact that Tesla is breaking years of promises about EVs being cheaper to maintain, and continues to make such promises is disingenuous at best. Hopefully you're starting to understand the points that Chas, Jerry, myself and others have been trying to make.�
Sep 22, 2012
ckessel I'm not sure what point you think I've missed. I've stated several times I fully understand people that were upset about the maintenance costs.
My other point, completely separate, was the legal thing about where you had to have it serviced. Legally Tesla can't require a Tesla shop and they don't. I fully understand that at this point in time it's the same in practice since Tesla is the only one that knows the proper maintenance techniques, but that doesn't change the fact that legal issue is separate from the service cost issue.
Over what time frame? ICE's get very expensive to maintain in years 5-10. In the last few years I've had to replace a fuel pump, timing belt, spark plugs, spark plug cables, and the coil thing between in front of those that was crazy spendy.
If you want to just talk about years 1-4, Tesla is no deal. I haven't argued otherwise.�
Sep 22, 2012
hcsharp That is not a separate issue. With gassers we have choices if we think the dealer price is too high. Just because "legally" we have a choice in this case doesn't mean we do in reality. Where else can we go? I think that's why GeorgeB said that the annual service was required to be performed by Tesla.�
Sep 22, 2012
ckessel Oh, absolutely. But you knew that buying a Tesla. Who else was going to service the battery/pem/motor/inverter? Did you really think you'd have alternatives? Do you really think you'd have an alternative with the Karma? The Leaf? The Volt?�
Sep 22, 2012
dsm363 When the Prius first came out, could you get the hybrid system worked on at any repair shop or did you have to take it to Toyota? I see it as the same thing with Tesla at this point.�
Sep 22, 2012
clindsay I think you may have misinterpreted the meaning of the "money wasn't the issue" comment. Money wasn't the issue in terms of being able to afford the maintenance, but money is indeed the issue in the face of being forced to pay for the maintenance, which many of us feel is too high for the value, opportunistic, and flies in the face of the lower maintenance cost lies Tesla has been spinning for years now.
Many of the comments have been to the effect of, "Well you paid $100K for the car, you should be able to come up with $600 more a year for maintenance." So, for me and many others, we can come up with the cash needed to do the maintenance. We just don't want to. We don't see this as an appropriate price point for maintenance on a car that touts lower maintenance. It is a complete rip off, and when people like me feel ripped off, regardless if it is a $25 hamburger, or a $600 pair of windshield wipers, we get upset, vocal and eventually walk away frustrated and mad.�
Sep 22, 2012
ckessel Fair enough, no disagreement. My "money wasn't the issue" was specifically about polera's post where he was specifically upset about George's "Tesla only" mis-statement.
�
Sep 22, 2012
AnOutsider Exactly. I'm getting tired of hearing this. Do you (not you, but you know what I mean) think people who can afford expensive things got to that point by not knowing the value of their dollars? I remember at one of the stores I wanted a wallet and the rep came back to me -- almost ashamed -- to tell me that the price was $125. I just put 40k down on a car, could I afford it? Sure. Was it worth that to me? Not at all (didn't even have the Tesla logo).�
Sep 22, 2012
ckessel I find this somewhat funny since it was EXACTLY the logic that multiple posters told me (i.e. you can afford it) when I complained about the lack of tire credit for 19" rims on the Perf.
I'm not criticizing AO, I just find it amusing to see the argument revisited in a new context.�
Sep 22, 2012
brianman Holy moly. Does it come with 3 shares of Tesla stock in it?�
Sep 22, 2012
AnOutsider Not that I remember every single thing I've ever posted, but I'm pretty sure I didn't say that to you. I do remember disagreeing with you on the matter, but it was more along the lines of: "it's a package deal, I don't know of any manufacturers that let you break apart a package and tweak the prices -- it would no longer be a package".
In general, I'd say the only time I REALLY feel "hey, you can afford it, do it" is when someone is hemming and hawing on doing something they REALLY want to, but feeling a little iffy because the price is high -- in which case I usually tell them to go for it if it's not going to bankrupt them -- it's only money.
Nope, just a snicker from the accountants behind the scenes.
*edit* ha, it's even on their site: Tire Tread Wallet Tesla Motors
"Oh this? Yeah it's new. I got it to show support for the company"
"Which company...?"
"erm..."�
Sep 22, 2012
measton The issue is cost�
Sep 22, 2012
ckessel I have no idea to be honest. I hold no ill will over any of it. It was a very good, heated, but honest debate amongst a bunch of us. I came out of it really feeling like everyone got heard, but we simply had different opinions.
My goal wasn't to point a finger, just to say it was amusing to see a somewhat similar debate here.�
Sep 22, 2012
measton The issue is cost
600/12,500 miles = about 1000 bucks a year for me.
The only warranty I'm worried about is battery, PEM, charger, computer - I can service the rest.
Now given this is a new car what sort of service do these elements need. Well according to the VOLT and Leaf maintenance schedule zero except for coolant.
Electrics are low maintenance.
Batteries - Monitored by the car no need for mechanic every 12,500 mi. If the rangers come to your office they are not pulling the battery pack.
PEM,computer,and charger should require nothing more than a dusting.
Brakes - My civic hybrid needed them at 7 years 112,000 mi
Wipers - Please
Towing - Triple A 55 bucks for the year
Software updates - If needed then should be covered under warranty if novelty then we can buy them if we want them
They would have been much better off asking 3000 more for each car and offering this stuff for free, but what they are doing now is dishonest particularly doing it after people have made deposits and accepted cars. It's straight out of the corporate America B school handbook on how to put your customer in a vice after they make a purchase.
This is what got me to cancel my reservation via my dealer. Tesla later phoned me and informed me that the the service contract was not mandatory for the warranty so we didn't complete the cancellation, but there is conflicting information from others in the company. I'm giving it another month and if things aren't spelled out I'll drop my reservation again.
I'd planned on ordering one for my wife if I liked the car, and I have plenty of people who ask me for advice on hybrids and electrics seeing as I own three. Tesla is shooting themselves in the foot with this.�
Sep 22, 2012
strider This is my issue. I have a Roadster so in theory I'm fine w/ paying $600+ for service but Tesla needs to tell me what they're actually DOING. $600 is like 4 hours of shop labor. What is a tech doing for 4 hours? Plugging in a laptop to run diagnostics does not count. I can see 2 hours to plug in the laptop and while that's running check the brakes/suspension, fluid levels, rotate the tires, etc. They're not going to do an alignment unless you complain about the car pulling or notice irregular tire wear. Same w/ balancing.
I believe Tesla is spending 4 hours on my Roadster each year because I've been told what they do. Until they tell me what they're doing on Model S I'm not buying it.
This being said most of us have over a year before this will matter. So hopefully once they fall into a production and delivery rhythm they'll have time to get us this info to let us make informed decisions.�
Sep 22, 2012
brianman Measton, if you happen to contact them again can you please ask them to provide publishing-to-the-forum-friendly language in e-mail form?
Many of us on the forum would like to see the phrasing, especially in light of the apparent conflict in phrasing between George B. and the warranty PDF.
Thanks for sharing and in advance if you happen to get that.�
Sep 23, 2012
polera257 Very well said and exactly my point. I let my temper and disappointment interfere with my proper communication of my feelings but you put it perfectly! Thank You�
Sep 23, 2012
Beavis When someone says that something is too expensive, then the real issue is perceived value received for the price paid. Strider is right. Let's see what specific maintenance procedures they want to perform for their $475 (in my case) before going off the deep end.
I have said before that I am comfortable with the price if they are going to spend "several hours" inspecting my $100,000 car with a fine tooth comb. For me, it's too big of an investment to not want to someone meticulously going over it every year. So, let them publish the maintenance schedule.�
Sep 23, 2012
efusco Have done my own oil changes, fluids, tires, wheel rotations and other work on my Prius since I got it in 2003. I did take it in to Toyota for hybrid system related service, and still do.
Evan, Via TapaTalk�
Sep 23, 2012
Mycroft Tesla should have two levels of maintenance. The full meal deal that many folks will be happy to pay for and the basic drive train maintenance for those who want to perform routine auto maintenance themselves or via a local shop.�
Sep 23, 2012
clindsay I think the itemization is a good idea, it would be helpful for some, but for me, it isn't going to be enough. I don't really care if the service takes one person 5 minutes or 5 techs and 3 days. Tesla sold me a car, and I signed my MVPA with the expectation that Tesla set, that service costs on the S, a revolutionary platform built from the ground up with low maintenance in mind, would actually have lower maintenance costs than an ICE vehicle.
Those of you who didn't believe Tesla's line on maintenance costs were perhaps better prepared for this number. Those of you who took roadster maintenance numbers in to account were much better prepared too. I didn't take those things in to account, clearly I should have. I took Tesla on its word. I looked at what the many ICE cars in my family have cost me over the last 30 years of driving and the yearly average is a tad under $325 a year. This includes many cars that we have owned cars from new to over 100K+ mile range. All these cars basically no significant maintenance costs in the first 4 years. It is the later years and higher miles that required belt and plug, and other fluid changes that brought the numbers up, items the Tesla doesn't even have. Looking back, at the first 4 years of owning 8 different ICE cars, the maintenance costs are $157.22 to be exact. My S shouldn't be higher than my 3 Hondas, 2 Acuras, 2 Toyotas and 1 Volvo. With maintenance at the pre-paid rate of $475, that means maintenance on this revolutionary low maintenance car is more than the average of 3 of my ICE cars, simply too high.�
Sep 26, 2012
ModelS1079 Just guessing you havent gotten too many software updates for your Honda. Costs more than I thought, but it isn't all bad. Indeed, it'll be awesome a year from now to bring the car in. Just not feeling the anger of others. Respectfully.
- - - Updated - - -
Just guessing you havent gotten too many software updates for your Honda. Costs more than I thought, but it isn't all bad. Indeed, it'll be awesome a year from now to bring the car in. Just not feeling the anger of others. Respectfully.�
Sep 27, 2012
AustinPowers Quite possible, but there is still the fact that Tesla contradicts itself by proclaiming that EV's have much lower operating costs, especially because of very low maintenance costs, yet at the same time they charge an annual fee that is far above what many people have to pay for cars in the same price region, even though these are ICE's with far more breakable parts and consumables that need replacing.
So if a new buyer is faced with those facts it is hard to see, why he would want to buy a Tesla.
And about the impact of seeing cars on the road. I don't know much about the size of the US car market, but it has to be at least MUCH larger than the German one. And even if there were 10,000 Model S's on US roads that would mean on average only 200 per State, with most being located in very few states like California. How often would there be a chance say for someone living in Wisconsin, the Dakotas, or many other states to actually see a Model S on the road, to start getting interested? I would guess it's more likely to see a supercar like a Ferrari, Lamborghini or similar than to see a Model S, for quite a long time to come.�
Sep 27, 2012
dsm363 There are at least 3 Model Ss arriving in Indiana soon and that's not far from Wisconsin. We basically have no idea what the long term maintenance costs of the Model S will be. We know about the $475/year for first 4 years. It's entirely possible that Tesla is right and that over time, it ends up being cheaper than something like a 5 series in years 5-10.�
Sep 27, 2012
pilotSteve Reading the Goldman Sacks secondary stock offering prospectus (yesterday) made me realize there could be a "darker" side to the service costs not included in the base vehicle price. Namely: should Tesla suffer a bankruptcy and restructure (unlikely IMO but they are dangerously close to running out of cash), any warranty expenses could be shed. And by defining service as a "post sale" purchase, that revenue (estimated to be $6-10 million per year) would be cashflow for the "new" Tesla company.
I remain firm that charging for this service is and will be a bad PR move that Tesla should reverse early next year once their cash crunch has eased and they see the drag this policy has on the EV sales pitch. Free Supercharging is great by only benefits some owners some time; included no-charge service benefits all owners!�
Sep 27, 2012
Rifleman I agree that the service fee is bad for Tesla. Just an anecdotal example, but it cost them my reservation (I canceled P8661 after George confirmed that not paying for the service wold void your warranty, as the extra fee was the final expense that pushed the Model S out of my price range)�
Sep 27, 2012
dave I won't be buying a service plan for my car. I haven't cancelled my reservation yet because I still find it hard to believe or even that it is legal to force paid dealer inspections in order to keep a warranty valid. I'm hoping it will end up being clarified by next year when my turn comes around (P9397). However, if it is not changed by then, I will be cancelling my reservation as well.
The cost of the car is already a stretch, but I was able to make the argument to myself and my wife that we are paying for a nice family car, and just "prepaying" for fuel and maintenance costs (as part of the base car price) that we would have had to pay if we had an ICE car. (Ala the http://www.teslarumors.com/Teslanomics.html website)
However, this mandatory service plan, plus delivery fees, prep fees, electrical wiring and adapter fees, etc, are all adding to the price "creep" that starts to invalidate my "value" based argument to buy the car. It is pushing it back into the realm of a cool luxury car, but impractical for a middle class family like us.
People are comparing the car's service plans to Audi's, BMW M5's, Porsche Panamera, etc. I don't care what their service plans are because I was never in the market for an $80K ICE vehicle to begin with. I was sold on the technology, company vision, and green benefits of this car. I am comparing this to my current Infiniti G37 ($35K new) that I drive. I do ALL of my own maintenance (so far), and have a perfectly valid warranty. I was willing to pay another $25K for a similar level of luxury, but get the EV benefits. This mandatory service fee though is pushing it past that price point, and just makes it too impractical.
I'm still holding out for a change in policy, but another $2400 just pushes the price of this car too high for very little in return.�
Sep 27, 2012
sp4rk S'pose everything is relative.
There's this state, it's called Illinois ... where I currently reside (although I'd give a lot to get OUT!) ... which is between Indiana and Wisconsin.
Quite an unpleasant drive too!
Not far?
I'd say IL is not far ...�
Sep 27, 2012
dsm363 It's only $2,400 for unlimited Ranger visits or if you don't prepay. Otherwise $1,900 for 4 years prepaid. Hopefully they can come up with something where you bring your car in for a battery system check and pay maybe $200 and you can do the rest of the service yourself.�
Sep 27, 2012
stopcrazypp A lower service fee along those lines would alleviate the concerns of most people (a mandatory $600 really is a bit ridiculous). The EV components are pretty much the only parts where a third party inspection isn't a viable option.�
Sep 27, 2012
swegman Tesla reported that approximately 1200 reservations were canceled. They did not indicate the reason(s) for the cancellations, but I'm certain that some of them were due to maintennance plan.�
Sep 27, 2012
jerry33 If you look at the maintenance plan has helping to pay for the free charging, it's not that bad. Sure I'd like it to be less, but free supercharging goes a long way to ease the pain. (about 25% of the miles I drive are "over 300 mile trip"[SUP]*[/SUP] miles).
[SUP]*[/SUP] There is probably a better way to say that.�
Sep 27, 2012
sp4rk Sadly, that's a huge number.
You have to wonder how many were Sigs at $40,000 and how many were production $5k.
Even so, at $75,000 (avg.) a car?, that's $90M.
Probably the cost for 2 years build out of the Supercharger network.�
Sep 27, 2012
jerry33 But isn't that 1,200 since reservations began in 2009? Over three years that's not really surprising. Also they didn't say how many got back in line (at least one forum member has done so) and how many went to Model X (we know a few have done that). Also some people hedged their bets with both a Sig and a Production reservation.�
Sep 27, 2012
donauker Yes, ever since the supercharger announcement I have been feeling much better about the whole maintenance plan thing. Now when you break it all down as follows, it feels like a very good value.
120.00 - Basic data plan with Tesla diagnostic monitoring and phone app access. ($10 a month)
75.00 - Software Update Package
50.00 - Roadside Assistance and towing
120.00 - Unlimited Supercharger access
110.00 - Annual inspection with alignment, tire rotation, and wipers!
475.00
Sounds like an amazing deal to me!�
Sep 27, 2012
dsm363 I agree. I realize it's still a lot of money but we're not buying a tried and true Ford Taurus here. Early adopters will always pay a penalty and we can hope it will lessen by Gen III time.�
Sep 27, 2012
ModelS1079 Just finished speaking in person with George 30 minutes ago. We spoke for quite some time. He defended the service plan and showed it to be an asset for us all. And he was amazingly kind with his time. Class act. $1900. Four years. No worries. I'm in. And I am betting dsm363 is in heaven behind the wheel.�
Sep 27, 2012
bonnie George IS a class act and cares about Tesla customers.�
Sep 27, 2012
dsm363 Yep! I agree, George is awesome and am glad he's at Tesla.�
Sep 27, 2012
swegman Jerry33, I had reservations for two cars, a signature and a production. I was going to get both cars. I canceled the signature for a number of reasons, mostly because features they told me would be included in the car are not currently available. I deferred the production for the same reason, and am leaning towards canceling that car if things don't change. I ordered the cars basically for 1 reason; I liked the 17 inch touchscreen which I was told 3 years ago would be able to access any website and play any video/audio file, just as a laptop can do. Sadly, that is not currently the case, and I don't know if it ever will be. The premium cost for the model S over an ICE car (with and without the extra cost for naintennance) pays for a lot of gas, which I would never make up based on the amount of driving I do and the cost for maintennance I am currently paying for my 3 cars.�
Sep 27, 2012
RDoc Could you share some of what was said?
Specifically is the service plan a requirement for keeping the warranty in effect?
Also, did he say anything about what happens after 4 years/50 K miles, e.g. what's needed to keep the battery warranty in force?�
Sep 28, 2012
jerry33 Three years is a long time to wait for a car, and there's no shame in canceling/deferring if the car isn't what you thought it would be. My wait will be about one year, which is only a bit longer than the wait for my last two cars, plus because I got in not all that long ago my expectations are closer to what the actual car is. If I defer it will be because production is going faster than I originally estimated.�
Sep 28, 2012
digitaltim I think I have said some of this before, but I think the $600/12.5k miles is a deal - especially if they hold the rate for years four and beyond. I averaged $1k/year in maintenance (not incuding tires) for my BMW and ~$2k/year for my Volvo over the respective 11 and 9 years we owned them. The Volvo was a lemon, so Ignoring that I still see savings over the life of the car (200k miles over years) on maintenance alone. Once you factor in fuel/energy, there is no comparison from my perspective...an ICE-based vehicle would have to get 138+ mpg to best the Model S in my model.�
Sep 28, 2012
neroden It is illegal if Tesla doesn't get an FTC waiver -- Magnusson-Moss Warranty Act (US Code 15 section 2302 clause c).
George B has now explicitly said that they will "forfeit" your warranty if you don't get service from a "Tesla Certified" technician, which is in direct conflict with the legal requirements of the Warranty Act (read it at
15 USC § 2302 - Rules governing contents of warranties | LII / Legal Information Institute ).
You might want to remind them that they're violating federal law. It might help clarify their minds. Tesla's legal team are clearly gross incompetents.
I'm still planning to get the car, but here's the actual base price:
Advertised base price: $49,900
Tax credit you might not get: $7500
Mandatory "delivery fee": $990
Mandatory "prep fee": $180
Mandatory-for-warranty, illegal service fee: $1900
True base price of car: $60470
So I was comparing to cars which have base prices of $60K, so it still seems worth getting.
However, the advertised pricing is dishonest, and is also illegal. It would be perfectly legal to require dealer service if the price of service was included with the price of the car, which goes to show that Tesla really, really, REALLY should have just included it with the price of the car. Sure, a car with a base price of $60970 ($80970 for the 85 kWh model) might have deterred people, but I don't think it would have deterred as many people as this behavior is deterring. It's making me consider selling the stock if they don't hire a competent legal team soon.
- - - Updated - - -
I think the outright statements from high-up Tesla executives contradicting this are really the problem.
Tesla is not acting cool. If Tesla said "Yes, of course we'll offer training courses for third parties to perform routine maintenance on our cars! And of course we won't require you to buy routine maintenance and inspection from us!" I think a lot of us would sit back and go "OK, cool."�
Sep 28, 2012
shokunin I think the 1200 number is not a cancellation rate over the past few years. I'm sure there are way more than 1200 cancellations out of 13,000+ reservations they have taken. They simply subtract the few that do each quarter with the new reservations each quarter, stating the "net new" reservations.
The 1200 to me sounds like the cancellation rate once reservation holders were notified to finalize their vehicles. It's hard to get $5k from people, it's even harder to get $75K from people when many haven't even seen or driven the cars for longer than 8 minutes, plus timing would have to coincide perfectly to those that want / need a car in 3 months.
I wouldn't be surprised if there are less than 2500 confirmed orders for Production #5000 and below. I would hope that the conversion rate for those higher than 5000 would be much better just due to recency of their deposits.�
Sep 28, 2012
wycolo > It is illegal if Tesla doesn't get an FTC waiver -- Magnusson-Moss Warranty Act (US Code 15 section 2302 clause c).[neroden]
Which they may already have filed for. If anyone can get a waiver you would think the mfr of a truly unique high tech vehicle could.
--�
Sep 28, 2012
kevincwelch I have a fear that this is the case, although it is completely unfounded on my part. I consider myself a pretty cautious fellow, so I don't fit the category of an early adopter in all senses. Being an early adopter for a $400 cell phone is one thing; being an early adopter for an $85k car is another thing!
Given the recent announcements about service plans, delayed delivery of warranty information, connectivity charges, implementation of software updates/tech updates, fees for 60 kWh charging and now reports on this website from Sig owners of technical problems (potential battery problems as well), I am sure that is going to affect the number of completed purchase agreements.
I am just 3000 slots away from getting my email, and if I were to get it tomorrow, I would most certainly defer until more reviews from owners were out there.�
Sep 28, 2012
clindsay I am P732 and I just bailed. First it was not including cupholders, which we hear might come later in an opportunity console (opportunty for Tesla to charge that is), then it was $600 wiper blades every year, now $1000 fee for superchargers listed as included and the reason I went from the 40 to 60KW battery. One to many hidden Tesla taxes on this car and we haven't even gotten wind of the data plan or the year 5+ taxes yet.
Nickel and dime = bye bye�
Sep 28, 2012
sublimaze1 Well ....
.... this is certainly an eye-opening thread. I have spent an overtly immense amount of time on this forum in the last two to three weeks. I have read the threads that I feel apply to my needs and curiosity. I will say that this thread certainly concerns me. I am looking at my car arriving around or slightly before Christmas.
Having said (written) that, I have signed my purchase agreement and will stay on to receive my car. There is not doubt that there is inherent risk as an early adopter. Look at the iPhone 5. But this is an inherent risk that I am willing to take. It is a material item, and although nobody (including myself) wants to lose material wealth, it is - in the end - material wealth.
The upside, however, has the potential for being huge: that I will/would be one of the first people to own and drive, what is unquestionably, the pinnacle of cutting edge development in the electric vehicle genre. Sure, it could turn out to be all the above (warranty failure, service failure, etc.). But, again, the upside is an experience for me. And it is an risk that I am willing to gamble, the payout being a true life experience.
Regards,
WJ
P188
McKinney, Texas�
Sep 29, 2012
splitsec002 Here's my take on what's Tesla has been doing.
I'm # 4007 res holder so I've been waiting over 2 years on this. Many things were mentioned but maybe not promised. Specifically I remember 4 USB ports, 4.4 second car.
Pricing finally rolls around and now only the performance does the 4.4 seconds. Out of my price range. Fine I will buy the 40kwh or 60kwh.
Options rolled out, now my 49900 car is not about 60k with options. Fine, that's fair, all the other car dealers do the same thing.
Air suspension will hold up your order till 2013. Fine it makes sense that Tesla would do batch orders and maybe their robots cannot make cars without air suspension. I'll give Tesla a break because I want them to succeed.
Cars are finally getting released and there are a slew of bugs and that Tesla needs to fix. I'm an early adopter so that's ok with me too as long as Tesla fixes these issues free of charge. Hold on now, we HAVE to pay for the maintenance program otherwise our warranties and software updates are invalid? 600 a year is not too bad but what happened to low maintenance? I'm getting less excited about the car. All the word of mouth I've done for Tesla about not having to pay for oil changes, filter changes, etc etc are now down the drain. It'll cost me more to do the maintenance than it will for me to do simple oil changes. I still love the car so I'll grudgingly pay for this maintenance that I am force fed otherwise my warranty will be void. Good job Tesla you just made another 600/year off me.
Now one of the reasons I finally decided to go with the 60kwh was because the website changed from TBD to Included for the supercharger. I've already signed my contract with Tesla and there is no wording at all that mentions anything about a fee to activate this hardware. If Tesla would have left that TBD I would not be pissed but they decided to say Included then make you pay for something else. That's plain stupid to me.
Why don't we go and buy a TV that says remote included! But when you go home and want to use the remote, you have to pay $500 to activate the thing. What's the difference Tesla to say something is included when you're going to charge for us to activate or test or whatever else your lawyers can come up with to word things to make it right for you to charge us and screw us up the hole?
It's sad that I will probably pay for this "Configuration of your Model S hardware, software and interface for Supercharging", because of resale value and the odd chance that I need to use it because it's an EV and I can't fill up like a normal ICE car. It's sad that Tesla is using this nickle and dime tactic.
I feel cheated because I have already signed my contract and now Tesla wants more money, yet again. Can't wait till they start charging us for connectivity, creep, map updates, software updates, etc etc etc.�
Sep 29, 2012
AnOutsider To be fair here, 5.6 was promised and at the Oct event Elon's "one more thing" was a performance model that did 0-60 in under 4.5s. 4.4 was never promised for anything other than the performance model.�
Sep 29, 2012
dsm363 Actually, the 4.4 seconds was never mentioned in public, only rumored a few months before the October event. Only at the factory event did they announce a performance version. The 5.6 second 0-60 times was mentioned often before that.�
Sep 29, 2012
MikeK You have the option to switch back to 40kWh if you're not happy with the cost of using the Superchargers. It's right there in the email.�
Sep 29, 2012
splitsec002 MikeK, I'm not iliterate I know I can pony up and pay the man or drop to the 40kWh. That's not the point. The point is Tesla made me believe that it was included and is now charging a fee for it.
Let's say you went and saw an advertised price for an Iphone5. You went ahead and paid for it. A week later the phone is released and there was a new feature that was supposed to be included. Let's just say it was a camera with the new 16mp. So the phone is now released and you go to pick it up. ATT says the hardware is included, the camera is in your phone but you need to pay an extra $100 to use it. If you don't like that you can buy the Iphone 4s instead. Or you can keep your iphone 5 and not use the camera at all.
That's how I feel.�
Sep 30, 2012
Chas F I don't really think that is splitsec002's point. His summary is spot on that we have been asked to accept a lot being early adopters and we've given Tesla leeway as they've set expectations and subsequently pulled away features or hit us unexpected new charges. They have also done this in a way that seems less than honest which is the most frustrating part of it.
Even though I am on a budget, I would probably pay more than these extras are worth just because I'm an early adopter. I paid $600 for the first iphone. Not financially rational but it was worth it to me because I enjoyed the heck out of the product. The difference here with Tesla is that they are dropping these extra costs on us in a way that is leaving some of us feeling deceived and extorted for the sake of profit.
I am even willing to give them a break if this is all due to some dire financial circumstance the company may/may not be in, but they need to find a much better way to handle this or they will loose their customers anyway.�
Sep 30, 2012
dsm363 They do and will smooth things out and have less surprises in the future but have the feeling they are flying by the seat of their pants on getting the Model S out the door. I don't think (but have no inside knowledge of course) that they are not planning these things in advance to try and hook people in and up-charge them. It seems to me that identify a financial concern and look to address it with addition sources of revenue to try and get cash-flow positive. By next year, all expenses and costs should be known to new customers but that doesn't help the early adopters. We are paying a premium but are also the first kids on the block to play with one of the coolest toys around.�
Sep 30, 2012
jerry33 I agree, with one small difference. I would say, "By next year most things will be known". I suspect we won't know what the second four year maintenance will be, how fast the SCs will be rolled out, complete opportunity console pricing, etc. for some time. I don't believe there is any malfeasance on Tesla's part, it's more that they have been so focused on production and quality they have mostly ignored communications and what communications they have done, other than the few events, has been mostly of the damage-repair type. And of course some of this is because when you try something new, things usually don't go smoothly. Just seeing how the TM website runs into the weeds and does the bounce on every lap is a pretty good indication of how the pricing and communications are being handled.�
Sep 30, 2012
dsm363 This is a company where they have IKEA furniture at HQ. They are running lean but with time and success hopefully, they'll be able to improve their communication, I agree.�
Sep 30, 2012
bluetinc Hey Splitsec002,
Let me play devils advocate to you for just a second, and tweak your analogy. You put your order in for the iPhone5, which has the ability to send txt messages, but no new rate plans for txt messages have been released. (I switched to txt messages because they use a phone network, the camera doesn't) Then the phone company comes out and says, we screwed up a bit, we looked at the way to set up a txting network, and the billing, and the costs associated with billing. After all that, we decided to offer our customers unlimited txting for the life of the phone for and extra $200. And, if you already ordered a phone, we understand that this is new, and partially our fault for not getting this info out sooner, you have the same option but we will cut your cost to $100. You of course could pass on this, but then you cant txt message.
Is this perfect, no, but I guess I would ask you if you expected to pay for charges at supercharging sites? (as we expect to pay for txt messages). If this had been sold to you with a better explanation would that have helped?
Peter
�
Sep 30, 2012
Brian H Well, if you want to play with numbers:
Of the $90M, about � is margin, so $23M. Superchargers are reputed to cost $�M ea. to erect. There are about 92 or so scheduled for 2012-3, so about $23M. About the same. The question then is: how many more reservations will result from the free charging announcement? Their margins will have to make up that $23. I'll bet there will be 10x more than enough.
-- And about counting the activation or any other fee as "payment" for the free charging, at the reveal Elon made it clear Solar City was covering those charges out of its surplus from selling array output back to the utilities (Feed-In Tariffs, etc.)�
Sep 30, 2012
pete8314 This is actually a good analogy. In the Apple keynote they spent ~10 minutes showing us all how wonderful the new Maps app is. 3D vector graphics, turn-by-turn etc etc. Turns out, it's mostly pretty crappy. I'm in France at the moment and it's completely unusable. I'm certainly not defending Tesla, but even the mighty Apple can get stuff wrong - they've been testing Maps for months, they must have known it was flawed, yet they still did the dog and pony show, hoping nobody would notice?
The point is, people will get over it. Apple will fix the app. The assumption is that Tesla will do the same. There's still no excuse (IMHO) for all the little hidden charges that are slowly becoming visible, but the silly thing is, all of these could have easily been made far more palatable with good communication. I still think their biggest sin is not rewarding those that put down $40k up to 3 years ago for something that, at the time, was nothing more than a loose concept. At least give them free servicing in reward for the faith they showed Tesla.
- - - Updated - - -
In the last office I built out, we went with Ikea desks and drawers....it has a comparable, of not better warranty than many of the more established brands. I was on a tight budget too, but it felt like there wasn't any compromise, except I paid less. The only downside is that it's instantly recognizable as Ikea for anyone that's had the pleasure/misfortune of spending a rainy Sunday inside an Ikea
Sidenote: the money I saved went on Herman Miller chairs for everyone, can't go wrong with those�
Oct 1, 2012
PeterW I know this thread is about warranty/servicing but there is a lot of discussion on here about the supercharging fees for the 60 kwh pack. So just in case you
have not seen this
Supercharging and 60 kWh Model S Orders - Message from George B�
Oct 2, 2012
Hank42 I quite agree with you here. If Tesla wants to inspect my car every 12,000 miles in order for my warranty to not be voided - no problem. I'm all for it. But don't hold me hostage and tell me I have to pay $600 for the inspection - that sounds like ransom right there.
How about a compromise guys? You can inspect my car for free every year and get all the juicy data you need, provide me with a list of items that you are going to replace that are broken as part of warranty, and then provide me with a list of items that you are going to repair/replace that are not under warranty, but need to be changed in order to keep the warranty valid.
Somehow, I don't think $600 justifies changing the brake fluid every year.
Keep warranty separate from "service plan". Telling me to "not worry about it" is silly. I *DO* worry about it and VOIDING a warranty because I couldn't or wouldn't cough up the cash shady to me.
Or how about this - charge me the $600, and if refund me the difference if you find nothing wrong.�
Oct 2, 2012
RDoc This is what really worries me. I'm waiting on an X, but since I intend to keep it awhile as I do most cars I like, I really want to know what it will cost to keep the battery on warranty for years 5 - 8. I'll definitely not accept the car if I don't know.�
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