Newscutter
Member
What it kills is the pretentious and overly inflated monetary value fantasies some owners have about their cars. The depreciated value of a car that sold for $107,000 new after 8-1/2 years and has 122,000 miles is not, in most cases going to be much, especially when it started with a $7,500 federal tax credit and possibly a state tax credit.
The only thing more convoluted and contrived than "Tesla math" (the net value Tesla ascribed to the purchase when new) is the fallacy some owners ascribe to the value of their car when selling it used. Some act as if it was like real estate and should appreciate. This is partly fueled from greed, ignorance, arrogance, and that prior to Tesla doing 2 things in 2015 which really decreased the sale price of a used Tesla.
Until the spring of 2015 there was an upto 6 month wait to receive a newly ordered Model S and there was no Tesla CPO program. People were sometimes pay more for a used Tesla than a new one because they could see, test drive, and purchase the vehicle they test drove on the same day. They paid a premium for that convenience. As soon as the Tesla CPO program started, where Tesla was selling used Tesla at the price they acquired and repaired the car that inflated used car market began to crumble. When they reduced delivery times from 6 months to 6 weeks, it further eroded. The introduction of dual motors and AP1 in the fall of 2015 further reduced the demand for earlier, used models.
Prior to our battery failing, the used sale value of our car was in the $25k - 30k range (not that we were interested in selling it). When the battery failed Tesla offered to buy our car as a trade in for $17k. Given the age, miles, and condition of the vehicle, it was a fair offer. There was a time when part of the unique value of a Tesla was it being the only long range EV one could buy, and the only EV with a charging network where one could drive across the United States. Both of those paradigms have changed. Part of "the plan" stated early on by Elon Musk was to provoke other automakers to build EVs and to expand EV charging. That mission is being accomplished. One of the realities of that happening, without arguing about the differences between Tesla and other brands is there are other options people have, so the price one gets for a used Tesla is less than what it was when Tesla had the exclusive market for long range EVs.
Tesla further reduced the resale value of Models S/X with the introduction of the newer AP, longer range versions of S/X, at lower prices paid for the bundled packages rather than when features were purchased a la carte. The introduction of the Model 3 and Model Y also reduce the resale value of prior models.
The bottom line financially (and environmentally) is if anyone wants to extract the greatest value from their Tesla, drive it until it can no longer be repaired. Ours is paid in full. Our choice was Buy another $39k Tesla (trade in + price of battery replacement $22k) which would be a vehicle we don't like as much as the one we have, or buy a used $25k-30k Model S (which would potentially have other problems we already fixed on the one we have), or repair ours for $22k and keep the car we enjoy with the repair history we know, while continuing to drive electric, mostly fueled from the solar PV and wind turbines at our home. For us, this was not a difficult choice. We bought this specific car (Signature Red P85) quite deliberately CPO in January 2016 for about $60k, when it had 19,600 miles on it. This was and is "our birthdays, anniversaries, and whatever gifts to each other for the rest of our lives." We've been driving electric since 2007, mostly EV conversions, so we really appreciate what Tesla accomplished.
When one has a context other than a financial balance sheet and a fantasy about a rapidly depreciating item such as a car, one is less likely to be disappointed about repair costs of early production years or resale values.
Your lengthy self-justification notwithstanding... You apparently failed to notice that I made a similar conclusion at the end of my post; that I would also replace the battery.
BUT NEITHER of our opinions changes the fact these replacement prices will be a problem for Tesla and our reasoning/justifications are completely irrelevant to what the market will bear as more and more owners get caught in this scenario.
Let's see what happens in the next 2-5 years, and then we'll know what context really matters to Tesla's survival. I'm going to bet that you and I are in a vast minority of people who are sentimental enough to keep these cars long term.