That is a good question. Hardware upgrades refer to changes we make to components that are already installed on your Model S. Through the program, you would be eligible to receive any of the upgrades that we come out with at no extra charge.
For example, when the production team created a better defroster vents for the Model S last year, even older Model S equipped with the previous defroster vents could receive the upgrade. If you had the service plan, this was included. This is distinct from the warranty, which would cover replacement the vents with the same components if they were defective or failed.
Almost every car sold has a warranty to protect against defects in workmanship. Offering hardware upgrades means you are entitled to the latest and greatest version of each part of your vehicle, even if they are not defective.