Forums

True cost of Tesla 3 ownership in 10 years.

True cost of Tesla 3 ownership in 10 years.

Has anyone done any analysis or scenarios on the true cost of ownership for the tesla 3? Assuming $45k tesla with $7500 rebate and gas and Maintenence savings.

Tropopause | 10. April 2016

Not possible until we know more, especially Supercharger specifics.

Chunky Jr. | 10. April 2016

We don't know cost of gas over 10 years. It can wildly fluctuate.

If ou want to make a wild guess, assume 3 cents a mile in electricity. Compare that to what you pay per mile in gas right now.

jordanrichard | 10. April 2016

Completely impossible to answer. Gas saving? That would depend on what you are driving now and what gas costs in your area. Maintenance savings? That depends on what you are paying for maintenance now?

Also, that $7,500 is not a rebate, it is a tax credit. That means depending on your personal tax situation, you may not get $7,500 to come up with a net price. The only way you are going to tangibly get $7,500 is if you had paid that much or more, in Fed taxes out of your pay check and that the $7,500 credit wipes out any tax liability.

jfingas | 10. April 2016

You probably won't completely recoup the cost of going EV unless you drive very frequently, but I suspect the financial blow of the Model 3 will still be less than the price suggests.

To me, the biggest question is how much it'll cost to replace the battery when it's not covered by Tesla. It's one thing to drop $10K-plus on a battery for a Model S, where that might only be a tenth of the cost of the car... it's another on a $35K vehicle. My guess is that it's going to cost several thousand.

jordanrichard | 10. April 2016

jfingas, your question about battery replacement cost can't be answered either. Also, the earliest point that you would have to shoulder the cost of the battery would be 2026. So, are you asking for a prediction of what the replacement pack will cost 10 years from now?

Haggy | 10. April 2016

You don't have to pay $7500 or more out of your paycheck. You don't have to pay a penny in federal taxes out of your paycheck. You need to have a total liability of $7500 or more in order to get the full credit, and whether you paid the whole thing and get a refund or pay none of it and end up with no taxes due changes nothing.

If you plan things right, you can lower your deductions to the point that you have $7500 less taken out of your paychecks over the course of the calendar year in which you buy the car, and if you plan things perfectly, you'll get neither a tax bill nor a refund and have money to put toward the down payment.

Or you might find that your total federal tax due for the year will be $5000, and you'd have the option of getting a total tax credit of $5000, but it might turn out that you have appreciated securities that you could sell and have a capital gain of $2500 due. If you do that, then by selling the securities, your taxes wouldn't go up, since your credit would go up accordingly. You could then buy the same securities back at the price you sold them, and end up with the same securities but with a higher cost basis. That way, when you sell them again down the line, you would save $2500 in taxes with this example.

The bottom line is that you want to have a total federal tax amount of at least $7500. When you pay it isn't the issue, and neither is why you owe it. Just remember that you can't make up for it later.

Ross1 | 10. April 2016

In 10 years you probably need new batteries.
Factor in depreciation and I think the car has zero value at 10 years

yongliangzhu68 | 10. April 2016

Has anyone ever done a true cost of 10 years ownership of their ICE car?

Chunky Jr. | 10. April 2016

The average person keeps a car for about 6 years, so why is a 10 year cost of ownership significant?

Ross1 | 10. April 2016

No one here is an average person.

Maxxer | 10. April 2016

I keep my cars till they die
300 000 miles average

MarlonBrown | 10. April 2016

I have done that applied to my own situation. I spend on average US$400/month in gasoline. I drive 24K miles/year. In a matter of 2 years I need to replace my car since factory warranty is already gone. That means major depreciation hit in a $40K car. In my case in operational costs alone I should be able to pay the Model 3 in five years using it.

jordanrichard | 10. April 2016

And why do you need to replace your car after the warranty expires.........?

Red Sage ca us | 10. April 2016

The ability to drive fully electric for the next decade in a car that makes me smile every time I get behind the wheel...? Priceless.

JeffreyR | 10. April 2016

@Red Sage +1
"The ability to drive fully electric for the next decade in a car that makes me smile every time I get behind the wheel...? Priceless."

A Harvard MBA did a Net Present Value (NPV) sheet to convince himself a Model S made sense. He is going to update the sheet (see quote below) when he has time and a bit more information. I suggest you wait for him to finish and plug in your data.
http://www.teslacost.com/
"Update on March 31, 2016: Given the continued high interest in this cost model, and the upcoming Model 3 launch, I'll be updating this analysis for the Model 3 in the next day or so as more information comes in."

Tropopause | 10. April 2016

Elon is striving for the one million mile drive train.

Ross1 | 11. April 2016

@Red:
Did you buy a bolt?

Ross1 | 11. April 2016

Oh I know, a KIA, makes you happy

dd.micsol | 11. April 2016

Wow. What a bad question-meaning not enough info to give you an answer that's even close to a guess.
R U driving a Hummer3 or a 450 diesel truck or a honda accord or a prius. Just not enough to even give you a comparison. Against all ICE-Telsa is better than all of them in the long run. For 10 yrs-I estimated that the Tesla 3 was a better value than a Prius bought at the same time with no major repairs with today's gas prices - 2.47/gal in northern VT.
Tesla performs better, is cheaper by 10 yrs of driving, much much cooler and hip, technologically advanced and when the time comes-just replace the battery-no need for a brand new car-now maybe you want to upgrade to the latest car by then. My wife and I plan on making money with our Tesla by allowing test drives-marketing and getting credit by those who buy due to our reference, and mileage gas expense reimb from using it for work.
It's just plain better overall in the long run.

damonmath | 11. April 2016

I put together a quick list of the "cost to operate" my former 2010 E550 coupe for comparison. I'm using the following specs (gas, maintenance, tires) that do not include the car payment or insurance. These are just the costs to move the vehicles down the road the same amount:

E550 Per Year
20,000 miles driven
18 miles per gallon
$3 avg. cost of a gallon of premium unleaded in So Cal
$450 for A service per alternating 10,000 miles
$800 for B service per alternating 10,000 miles
$1000 per year for tires (staggered @20,000 miles per set)
$5,583.33 total per year
__________________________________________
$55,5833.30 for 10 years

Model 3 Per Year
20,000 miles driven
$927.10 per year ($2.54 per day charge @ $.14/kwh)
$633 per year ($475 per every 12,500 miles)
$685 per year for tires (19" @35,000 miles per set)
2,245.10 total per year
__________________________________________
$22,451 for 10 years

These numbers are just best guess estimates.

sj | 11. April 2016

I would not reduce your Federal withholding yet. If you start claiming MFJ and 20 exemption on your W4 therefore under withhold in 2017 or 2018 and don't take delivery till 2018, 2019, worst case no more credit. Now you owe Uncle Sam $$$ when you file you tax return. I would not count your chicken ($7,500 credit) until I am sure of delivery year, credit available (if any).

f3rretus | 11. April 2016

It will definitely be quite a bit less than a comparable (use the word lightly) POS BMW 3 series.

f3rretus | 11. April 2016

@damonmath

If you have solar panels the cost to operate the car would be $0. My house, Tesla, and Volt are powered by the sun.

damonmath | 11. April 2016

@f3rretus - I'm not too far behind you with the Solar Panels. In my analogy if the source of electricity were solar, then the Model 3 would pay for its self by the time 10 years were up. That fact alone should get people's heads turning.

adias.angel | 11. April 2016

@damonmouth great job on the breakdown!

When I did my cost comparison I did gas vs electric only (not cost of maintenance). Since most of miles will be highway miles commuting to and from work, I compared what we realistically get on the highway with our ICE car (Mazda 3) vs cost of electric off peak:

EV off peak charging rate: .09/kWh = .03/mile
Min cost highway travel: $2/gal = ~.057/mile
Max cost highway travel: $4/gal = ~.115/mile

For each 100k miles I drive I will save between $2,700-$8,500 depending on gas prices. You can factor in 17 oil changes in that time frame also. At $40 per oil change, you would save an additional $680 bringing you to a grand total of $3,380 - $9,180.

Morlandoemtp061383 | 11. April 2016

I expect of you can prevent the bottom of the car from rusting a model 3 should last you 20-30 years that is my justification for purchasing one, my current honda accord has lasted me 16 years. When I purchase something big I like to keep it a long time.

Haggy | 11. April 2016

"In 10 years you probably need new batteries.:

Based on what?

warren_tran | 11. April 2016

I went to Costco yesterday and had to fill up my xc60. The gas line was 30 cars deep across all 6 pump. That is enough for me to glad I reserved a model ≡

I just wish it will be here sooner even though my daily driver (S40) only cost me gas and insurance now.

SamO | 11. April 2016

Based on a bridge left unguarded.

Ross1 | 11. April 2016

@ Haggy:
Based on being warranted for 8 years.
And my Li-ion builders tools.
And no better information, not having been to the future. But I could ask Marty.

@damon math:
How many gearboxes in the Benz in 10 years, how many drive units in the Tesla?
What we don't know is the cost/likelihood of expenses down the track.
I have a relative who is a MB fanatic, but he would never own one out of warranty.
Tesla? unknown.

jordanrichard | 11. April 2016

Ross, you can't compare the Li-ion batteries in your cordless drill to what is in the Tesla. The very significant difference is the battery management system in the Tesla.

suresh7745 | 12. April 2016

why are we talking about gas prices. the purpose of tesla is to relieve us of gas. just think about cost of tesla, cost of electricity, battery upgrade costs, replacing tires because of too many quick starts etc.

adias.angel | 12. April 2016

@sureshthota7745 We are comparing to cost of gas to evaluate cost savings vs current ICE cars. For me I need to know that decision is not only good for the environment but also fiscally responsible.

Hi_Tech | 12. April 2016

@SureshThota - I agree. In fact, we should be talking about how to lower our cost of ownership as a EV owner (i.e. my solar panels help reduce my power costs to about $0.02/kwh, instead of $0.20/kwh that my power company would take..... ).

@adias.angel - I understand what you say, but that should be done before deciding to move forward (I spent many hours/days building out my spreadsheet with the assumptions based on my own lifestyle to show that this would be financially responsible option). Once decided, spend your time thinking of how you will lower the cost of the EV even further.

adias.angel | 12. April 2016

@HitsehBhatt I know I personally made my reservations have done my "number crunching" but there are some people who placed their reservation to see if they would be able to get the tax incentive/get in line early. So we need to help those who are just at their "number crunching" phase.

I know for me personally that is going to be where I end my cost savings analysis. We are not planning to keep our current home long term, so I will not be investing in any infrastructure related to my home as my return on the investment will not vet out before we move.

PhillyGal | 12. April 2016

Edmunds(dot)com has a good tool showing total cost to own (5 years) for a particular vehicle.

The BMW 335i x-Drive (which I think will be the best vehicle to compare to a Model 3) - has a total cost to own of $55k. with depreciation being, as expected, the largest chunk at $26,000. Fuel and maintenance cost is $15,000. This is where the comparison matters because depreciation and insurance are what they are.

Fuel I bet would be about 3k to every 9k - rough cost of electricity over gas - for the M3 vs. BMW.
Maintenance would probably be 500/year for 5 years, plus tires = 3500. Compared to $5600 for the estimated BMW maintenance costs per Edmunds.

This is a BMW at a trim level with a purchase price near $50k. If you got your hands on a $35k BMW, depreciation would be significantly less. As it would be in a base Model 3.

Now if a person gets a speced out M3 that costs $50 (or more) AND gets the $7,500 tax credit, total cost of ownership really skews in favor of M3. Though then you get into the impossible-to-assume territory of whether or not depreciation of M3 accounts for the credit or not the way it does for a Leaf right now. 3-5 years after the M3 is out, I'm curious what the used market will dictate. Since the tax credit will presumably be gone, it might not factor into depreciation the way it does now. (For example, it's a real consideration right now in buying any EV new vs. used, which is what drives the residual value down.)

brando | 12. April 2016

If most people actually considered costs of owning a car, I would suggest the following.
1 - People would try to organize their life to never own a car. Rent when needed?
2 - People would try to only buy used.
3 - Put minimum of 250,000 miles - original buyer did ~30,000)
(biased view from 1976 Saab 99 bought 1978 still running fine when I sold 1990 - 18,000mi/yr)

Only about 1% eletric so far (include hybrid electric driving time?). Some tiny countries/cities might be mostly electric in 20 years and the planet? The potential is to cut transportation costs about 75%? Let the journey begin!
Oh, it actually has begun. The start of the start.

brando | 12. April 2016

Another way to view your auto costs:

Beginning Jan. 1, 2015, the standard mileage rates are: 57.5 cents per mile for business miles driven, up from 56 cents in 2014. 23 cents per mile driven for medical or moving purposes, down from 23.5 cents in 2014. 14 cents per mile driven in service of charitable organizations, steady from 2014.Jan 25, 2016.

My 220,000 miles 12 year experience - 18,333 miles/year
All Business = $10,542 per year
All Medical/move = $4,217 per year
All charitable = $2,567 per year

From AAA Based on 15,000 miles per year

Annual Cost Per Mile $0.449 to $0.708
Annual Total Cost $6,729 to $10,624

http://newsroom.aaa.com/2015/04/annual-cost-operate-vehicle-falls-8698-f...

Red Sage ca us | 12. April 2016

PhillyGal: Check out this comparison at the EPA's website...

http://www.fueleconomy.gov/feg/Find.do?action=sbs&id=36751&id=37216&id=3...

2016 BMW 335i xDrive Gran Turismo -- You SPEND $2,250 more in fuel costs over 5 years compared to the average new vehicle

2016 BMW i3 BEV -- You SAVE $3,250 in fuel costs over 5 years compared to the average new vehicle

2016 Tesla Model S AWD - 70D -- You SAVE $2,750 in fuel costs over 5 years compared to the average new vehicle

Haggy | 12. April 2016

If it follows that the battery will need to be replaced after 10 years because the battery warranty is eight years, then it follows that the whole car will need to be replaced after five years because it has a four year warranty. It follows that the car will break down after 62,500 miles because it has a 50,000 mile warranty.

In real life, a warranty isn't something that indicates that something will fail once the warranty ends. A warranty is an assurance that there's enough time to catch any defects in material or workmanship in the period in which they are likely to become known.

Based on the number of miles of range that Model S owners are losing per year, especially in the later years, it seems extremely unlikely that a typical owner would see a difference with respect to daily use if the car is charged each night. It would also seem that there would be more than enough range to get from one supercharger to another, and it would be unlikely that a typical trip would need even one more supercharger stop. But even if it needed one more stop, I think owners of a ten year old car would prefer that for the few times a year that they take long trips than they would spend thousands of dollars to avoid it.

If I had a 10 year old Model S, and the range dropped almost 100 miles since it was new, and I wanted to drive from the Bay Area to SoCal, I'd do a battery swap at Harris Ranch, use a fully functioning battery during most of my trip, swap back to my fully charged original battery for free, and drive back home nonstop. But if I had severe degradation, I'd need a 15 minute stop on the way home. I'd still see no reason to buy a new battery.

More likely, I'd own more than one car and wouldn't use the one with the old battery for long trips. But in a pinch, I could do it anyway.

kuma57 | 12. April 2016

No one has yet mentioned the externalized costs of gas or diesel powered cars. Toxic gas and diesel fumes inflict major health and longevity costs that must not be ignored, and the Climate and Geopolitical impacts add Trillion$ more. Economists caculate the Iraq oil War alone will cost as much as $6 Trillion dollars by the time all the bills, medical care, and interest is paid. $6 Trillion could have purchased a new Model 3 for each of the 117 million households in the USA, plus enough solar panels to recharge all of those Teslas every day. Actually $6 trillion would likely be more than enough because Elon would most certainly give the US a big discount on 117 million Model 3 / Solar charger package deals. Which public policy would you vote for: The war to control Iraq's oil ....... or a new Tesla for every household in the US plus enough solar panels to eliminate the need for imported oil.

kuma57 | 12. April 2016

No one has yet mentioned the externalized costs of gas or diesel powered cars. Toxic gas and diesel fumes inflict major health and longevity costs that must not be ignored, and the Climate and Geopolitical impacts add Trillion$ more. Economists caculate the Iraq oil War alone will cost as much as $6 Trillion dollars by the time all the bills, medical care, and interest is paid. $6 Trillion could have purchased a new Model 3 for each of the 117 million households in the USA, plus enough solar panels to recharge all of those Teslas every day. Actually $6 trillion would likely be more than enough because Elon would most certainly give the US a big discount on 117 million Model 3 / Solar charger package deals. Which public policy would you vote for: The war to control Iraq's oil ....... or a new Tesla for every household in the US plus enough solar panels to eliminate the need for imported oil.

PhillyGal | 12. April 2016

@Red - Nice.

kuma57 | 12. April 2016

Fact update: Total US households number 124.5 million (2015), however $6 Trillion is still more than enough to buy a $35,000 model 3 for each one of the 124.5 m US households, plus enough solar panels to recharge each of those Teslas every day (factoring the national US average of 31 miles driven per day @ an average .3kW per mile). (117 million was an accurate number for US households not that long ago when I first made this argument that solar powered electric cars for everyone would be a much better public policy choice and an infinitely better moral choice than wasting Trillions on wars to control foreign oil)

jordanrichard | 12. April 2016

"2016 Tesla Model S AWD - 70D -- You SAVE $2,750 in fuel costs over 5 years compared to the average new vehicle"........huh?

My window "sticker" for my Mar 2014 S85 says I will save $8,000. I know I have more range than a 70, but over $5,000 in equivalent gas worth?

justinmk3 | 12. April 2016

What's with all this 10yr battery doomsday talk? Rubbish. Listen, i know folks who have THE FIRST or early battery powered hybyrid toyota prius, and honduh insite...Both batterys well over 10yrs old. No replacement, needed. Still going. I'd imagine Tesla battery tech to be even better. -Drops the mike-

justinmk3 | 12. April 2016

*batteries, although the other is quite funny. :)

Supraman | 13. April 2016

Haggy - "I'd do a battery swap at Harris Ranch"

I remember watching a Tesla demo of a battery swap last year, but did it become a reality?

jordanrichard | 13. April 2016

Supraman, yes it did, at 1 location. It required you to make a reservation so that Tesla knew to have someone there. I believe for the relatively few people that used it, it took about 10 mins. Then at a later point, they were required to come back and get their original battery pack, back. The cost I believe was $60.

Supraman | 13. April 2016

jordanrichard - Thanks for taking the time to reply. That's interesting. Are there plans for any more or has the whole concept been abandoned? Any chance they will try to resurrect the idea with the Model 3?

Pages