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After The Warrantee Runs Out-resale?

Discussion in 'Model S' started by Luclyluciano, Nov 1, 2013.

  1. Luclyluciano

    Luclyluciano Member

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    I am very interested in purchasing this car and have mentioned it to my friends who also own high end vehicles. They all warn me not to buy, concerned about the resale especially after the warrantee expires. They question me about who will service this expensive purchase. I realize , Tesla is probably the only one that can and they seem overworked now.
    My friends have me thinking of what the service will be like when there are 4x as many vehicles produced on the road, still under warrantee with possible 4x as many service calls.

    On top of that, how glitchy will these cars be, 4 years down the line and after the warrantee is done will they be worthwhile to keep and maintain or will they be extra expensive because of the computerized technology.

    There definitely will not be a local service centre or dealership every few miles that know how to service the Tesla like there are now for the ICE.

    All these concerns are valid and most certainly impact the resale value and demand for these cars now and will multiply and escalate as more vehicles hit the roads.

    Please, protective fanboys who want to flame need not post. These are serious concerns by me and many others on the fence which need to be discussed.
     
  2. JST

    JST Active Member

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    The questions you raise are legitimate, but ultimately impossible to answer with any certainty. As the cars get more popular, the strains on Tesla service will be huge...but if the cars get that popular, there's little doubt that independent service options will arise.

    What will resale be? Who knows? There's some precedent with the Roadster, but it's of limited use since the Model S is a much higher volume vehicle. A lot depends on the batteries; how they hold up and how much they will cost to replace in 5 or 10 years. That's data that none of us have right now.

    Having said that, resale value on cars in this price class is generally pretty bad. Look at what you can get a 10 year old S class Mercedes for. Will Tesla be better or worse? It's really impossible to say, but for planning purposes I wouldn't count on it being much better.

    Bottom line? This is a new product and a new paradigm of mass-market transportation. No one has done this before, so precedents are hard to find. To buy the car, that's a risk you've got to get comfortable with. In my case, the RVG helped, since I figure I can walk away at 3 years if I don't like the car. But even that carries some risk, since it depends on Tesla (and Musk) being solvent in 3 years.
     
  3. Luclyluciano

    Luclyluciano Member

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    Thanks JST. I guess you are right. At this point in time, it is a gamble. I believe I read there are 20,000 Model S sold per year. At that rate, with no increases in sales, there will be 80,000 vehicles on the road that need servicing. Probably all by Tesla. That potentially means 4 x as many service calls yet Tesla will not be able to afford 4x to service technicians with the same annual sales.

    I truly hope they succeed as I feel the time to move away from the ICE and 100% fossil fuels is disgustingly long overdue.
     
  4. swaltner

    swaltner Member

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    But, 4 years from now, there will be 20,000 Model S that have run through their 4 year (non battery) warranty and will be needing service. At that time, all that service work is revenue, not warranty expenses like it is now. At that point, as long as their service fees are set to where they are making a little profit on repairs, does it really matter how many service technicians they need to hire to handle the fleet?

    But, the future hasn't happened yet, so who knows what happen to vehicle values. If you buy a Model S, at least you were driving an awesome car in the mean time.
     
  5. yobigd20

    yobigd20 Well-Known Member

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    just because the warranty runs out doesn't mean the car is no longer worth anything or the battery is dying. just look at the roadsters...those batteries are holding up VERY VERY well (better than projected), and the Model S's tech is superior to the roadsters.
     
  6. Chipper

    Chipper Active Member

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    I don't know you (obviously) but I think your friends might be right...at least for you. If your primary concern is worry about it breaking, then this car might not be the right one for you. It is not a car for everyone and is not meant to be. If, however, you want to buy cutting edge technology, absolute superior performance, if you are concerned about the environment or the safety of you and your loved ones; or just want something totally different than 99.7% of your friends; if you want to be thrilled every time you walk out to your garage, never have to wait at a gas station and worry about putting more dollars in the hands of our nation's enemies; if you want to be in on the ground floor of what the future is going to look like; if you want to truly "buy American"...I could go on but I hope I have made my point.........
     
  7. Zythryn

    Zythryn MS 70D, MX 90D

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    Tesla sales are increasing worldwide, assuming zero growth is unlikely.
    You are also assuming no growth in staffing at existing service centers and no growth in number of service centers.

    Also keep in mind, brakes, suspension, alignment, etc can be done anywhere. The drivetrain and batteries do require a Tesla service center, but any of that other stuff can be done anywhere.
    Of course, you will never have any work needed to be done on the exhaust system, oil changes, valves, turbo, etc.

    As for the question of resale, that is always a good question, and we don't have a 4+ year resale history to fall back on. Personally, I plan to drive the car a lot longer than that. However, if this causes you anxiety, go with Tesla's quasi-lease deal. Elon Musk will gaurentee the resale value after 3 years to match the resale value of other luxury sedans.
     
  8. ChadS

    ChadS Petroleum is for sissies

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    Resale is a valid concern. But nobody here can give you answers because, as JST noted, it requires information from the future. Getting the resale guarantee and adding the extended warranty will help.

    A complete comparison, if we could do one, would also balance Tesla resale values against that of competing gas cars. Nobody has any idea what the price of gas will be 8 years from now. What if there is a war, or a huge surge in demand from India and China, or a large carbon tax? (All real possibilities). Or even if the price just keeps trending up as it has over the last decade. And what if all of the major manufacturers finally get on board, and are then building great EVs with more range at half the price (largely due to far lower battery costs - which also means you might be able to buy a cheap but larger replacement battery if you want, even though your first pack should still be working fine), and DC charging stations are everywhere. What would the resale value of an 8-year-old gas car be then? More information we don't have.

    Like almost any choice you make in life, future events could make you could regret your decision no matter which way you go. Nobody can have enough information on this topic to help you make a buying decision, so I think you'll be better off considering factors that we have more certainty on. Chipper started a good list.
     
  9. johnnyS

    johnnyS Member

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    All of us owners had to consider these issues. I decided that since resale value is unknown, I will just drive the car a long time so that resale does not matter. I purchased the eight year service plan so my costs are fixed for eight years. After I have driven our model S for 100,000 miles I probably will buy something new. We usually have an extra car so maybe the model S will someday be our backup car when it is 10 or 12 years old.
     
  10. paulkva

    paulkva Member

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    My wife and I buy cars for the long term, so we don't pay a ton of attention to resale value. Our last two cars lasted us 13 and 8 years, and they were still running at least reasonably well when we sold them. Of course that begs the question of the Model S reliability record, which I admit also hasn't been fully established yet. (Although, Consumer Reports recently noted that the major parts -- battery, inverter, drive train -- are doing really well so far in aggregate, and many of the reliability issues have been more minor in nature.) I've had only one significant issue so far (charging cable stopped working early on), and I didn't even have to visit a service center to get it fixed (they shipped me a new one quickly). But my experience is just one data point -- others have obviously done better and worse.

    Also remember that even after the main warranty runs out, the battery (arguably the most expensive part) is still covered for an additional 4 years (total of 8).

    Having said all that, I recognize that the resale value of such an expensive car (based on other cars in the same price range) most likely won't be great, even if it proves to be extraordinarily reliable. Cars in general aren't good investments. And no matter how you look at it, with a car this "young" there's always a significant element of risk. I've weighed that risk, and the expected cost of ownership, against the rewards (I'll once again reference Chipper's list above for some examples), and despite my generally risk-averse nature, I came out solidly on the side of "buy now." But it's a highly personal decision.
     
  11. martinwinlow

    martinwinlow Member

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    We do, of course, have the data from the Roadster which, as other posters have mentioned, has already proven the longevity of the battery technology. Aside from the initial issues with the gearbox there have been no other reliability issues since - that I am aware of at least - and there are Roadsters out there with many miles - perhaps over 100k - on them now. Given that the technology used on the MS is much more up to date and improved from the Roadster I don't think reliability is going to be anything to worry about. Most of the issues I read about here are very minor in nature and more to do with a start up company than anything else.

    As a prospective MS buyer myself (though my Northern (English) roots will never allow me to buy a brand new one!), I do enjoy reading the posts about this game changing vehicle. The engineering 'insider view' often written about is worth it on its own but to hear clearly very sensible and thoughtful people, seemingly speaking my own thoughts, is as interesting as it is satisfying. MW
     

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