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Maintenance Program for $1900 Should Be Included In Price

Maintenance Program for $1900 Should Be Included In Price

Regarding the first 50,000 Mile Prepaid Maintenance program for $1,900, I think this should be included in the price of the car- at least for your first XXX number of purchasers. My rationale is as follows:

1) There will be all kinds of glitches in the car the first few years and I hope that we don't have to argue with Tesla about who's responsible. It's not fair to penalize those of us who took a chance on Tesla. All of my friends keep telling me that one should never buy a car in its first couple of years; I keep telling myself that Tesla wants to succeed and will do all in its power to make a great car and its customers happy, but I know deep down that my friends might be/are right. E.g., I can see the possibility that the disc brakes in the initial years might not be designed just right and not last as long as they will in later years. That has happened to me with other new cars I purchased in years past. I was not pleased when the manufacturer refused to take responsibility for my (and everyone else) needing new brakes after 15K, as brakes were not covered by the warranty. Here's another possibility: The maintenance program covers software updates. Does that mean that those of us who do not choose to buy the Maintenance program will have to pay several hundred dollars to get rid of software bugs or get the benefits of major improvements? Shouldn't paying the huge amounts we're all paying to buy the S and taking a chance on Tesla be rewarded with at least some loyalty from the company, such as giving us the benefits of whatever the software improvements might come down the road? If not, the people who wait to buy the car a year or two from now will benefit from our suggestions for how the software needs to be improved without paying anything extra, but those of us who were early adopters will be punished.

2) You want to be the BMW equivalent in the electric car space? Well, that is what BMW does- gives their buyers total confidence (takes away all fear) by providing both a warranty and maintenance program built into the price of the car. I've owned multiple BMWs over the years and know for certain the psychological effect of this policy - happy customers who are the best possible ambassadors for the brand. Tires, alignment, and state inspections are not included - everything else, including windshield wipers are included. Customers are delighted with that plan and it helps the company's bottom line and fine reputation - BMW does very well financially.

Volker.Berlin | December 14, 2012
jat | December 14, 2012

Yes, you could argue all sorts of things. Maybe you just want the car cheaper, like wouldn't it be nice if the base price was $40k instead? To me, it seems obvious that it isn't included because they wanted to keep the price that was promised 3 years ago, yet they found it wasn't enough. So, the maintenance is a separate line item. Likewise for the upcoming price increase.

The flip side is for $2400 extra (which I count as part of the price of buying the car for me personally), I get covered on everything but tires, no matter where I am. Nobody else provides that level of service.

Mark E | December 14, 2012

If you add the service price into the base price of the car then it becomes part of the calculation for transfer fees, luxury car tax etc. Put $100 onto the price and it becomes $140 or more to the consumer. I'd rather pay for it separately thanks...

andrea.elwork | December 15, 2012

BMW provides a "free" maintenance program and they are well established. Tesla needs to do the same and take away all fear of ownership. It will be good for customers and for the company.

dborn @nsw.au | December 15, 2012

Anything which adds to the invoice price of the car, which includes shipping and insurance to Australia, is then taxed at our luxury car tax rate of 33%. Admittedly, for an electric vehicle, that cuts in at $75300.00 odd. Otherwise it would cut in at $59000 odd. Therefore even the base model with a 40Kw battery at say 59000 would attract luxury car tax if it were not electric because shipping/insurance would push the price up say $4000. So, additional tax of 1/3 of 4000 over and above import duty of 5% on the whole price, with GST of 10% on top of the 5%. (an adjustment on the GST is made on the luxury tax component).
This is why all options should, if possible, be aftermarket or at least separately invoiced. Perhaps even the battery.

cmadsen | December 15, 2012

I test drove the Tesla MS performance model and was impressed at the initial performance of the car. After settling down from the tech side of the car - a more level headed look brought up concerns. Maintenance for one - and when the car does fail - you don't have a dealership to give you another car to drive. At $95K for the one we priced out at (and put down a deposit), this does not make any sense. Our current cars are 3 Porsches and 1 BMW M5 (my daily). BMW warranty is bumper to bumper - everything is covered. You do have to take care of tires/alignment, but not a huge issue. Of course this service os built into the cost of the BMWs. But at $95K, I can buy a new M5 with way more options plus the warranty. Oh yeah, and the gas purchases.

Tesla will need to step it up at price points in the $90K range. Again, the car breaks and you have to wait for a tech. Not so good on a daily driver. Especially in the winter - I am not driving one of the 911s until the tech arrives. Something to look into a little more

jat | December 15, 2012

@aelwork -- so you would be happier if the base price of the car were $2400 higher and included the 4-year maintenance, right? So just count it in the cost of the car and it makes no difference for you (unless you needed to finance that amount, in which case if you qualify for financing this car that shouldn't be a problem to finance on a signature loan). That way you get what you want and the people who don't want it bundled get what they want.

If you are asking for it to be included without increasing the price, well then you are just asking for a $2400 price cut on the car, which isn't going to happen since they have already announced a $2500 increase.

Brian H | December 15, 2012

That extra $2400 would be subject to various taxes, too, so would be even more. TM obviously decided against your "Ignorance is bliss" approach.

RZitrin1 | December 15, 2012

Has the program been announced as ready to sign up for?

BTW, anyone who bought this car looking for a bargain should have bought a Leaf.

Brian H | December 15, 2012

It's a bargain, but it takes time to realize the payoff. The nice thing is, that's greater and greater per annum the longer you go.

Chris25 | December 15, 2012

I'm on the same side that it should be included. If Tesla did a good job at validation, engineering specs, and supplier quality then there is no reason an electric car needs maintenance or repairs in its first 5 years. I realize its a new company but most of the engineering team has worked in the auto industry prior. I was disappointed to hear this as being an incremental charge. Their extended warranty price is reasonable but the first 4-5 years should be no charge. I think it's obvious they are trying to get back to original margins due to cost creep. It happens to every engineered project.

bob | December 15, 2012

I like Tesla but I really object to the huge so called delivery charge at the plant and the other little stick it to you's in the pricing. Like the maintence program. That being said I will most likely go ahead in March or April with my order. But it is not a good feeling. Rather like the lessor of two evils

Brian H | December 15, 2012

bob;
Why would you want Tesla to lease you one of two evils? ;)

You need to get some industry perspective. Try and imagine delivery charges adjusted for every case. What a nightmare!

As for the maintenance, the company has zero field experience with maintaining a Model S over long periods. Their charges are in line with other premium/luxury brands, an the service level is apparently unparalleled (per Roadster owners, etc.)

rd2 | December 15, 2012

cmadsen -
You might want to revisit BMW's website again. There is NO WAY you can get a new M5 with 'way more options' AND gas purchases for $95k. The base model M5 starts at $92,095.

http://www.bmwusa.com/standard/content/byo/byohome.aspx?namodelcode=135G

Add a few options, and you're easily at $100k for that car. Don't forget, that includes a 'gas guzzler tax' of $1300 - So I'm guessing that 5 years down the road, you'll have spent an additional $12k to $15k on gas (versus the $1500 you'd have spent on electricity in a Model S) if you drive more than 12k miles a year.

Cost of ownership will be much less with the Tesla. Spending $2400 on the maintenance ends up being a bargain if you plan to keep the car for 5+ years.

jjaeger | December 15, 2012

Bob - yeah your right. when i picked up my Chevy Mailbu at the Detroit plant they automatically adjusted the Delivery charge to a 20% value. Tesla is so behind the curve in this regard. And I too would like the maintenance cost rolled into the base so it gets uplifted with all the various taxes. Elon and team get on this will you...

olanmills | December 15, 2012

I too am not that happy about the service pricing, but I am not mad about it either. The biggest thing that bugs me is that this is more than you would expect to spend on the maintenance of any other car in the first four years.

That said, you have to remember the situation Tesla's in, no I'm not talking about its financial situation (though that's important too); I'm talking about this situation which allows it to actually raise the price of the car and still have more buyers than they can handle.

jat | December 16, 2012

@rzitrin - I expect delivery later this month or early January, and I was told that by the end of January I should be able to purchase the pre-paid maintenance plan.