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Changing order on new Model S LR
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I also agree with you to some extent however I think the 10k price tag for something that is so limited in its functionality (and likely will be for several years) doesn't seem like a very good value.
I also would suggest a counterpoint that to lay out 10k upfront, won't exactly equate to 54 payments. You lose the time value of the money. At the current rate of subscription, I could leave the 10k in my investment account where over its lifetime I am at about 11% average rate of return instead. That $1100 I'd earn by not touching it would pay for almost 4 months of subscription a year. Of course they could increase it but I doubt there will be many takers if it goes over $10k anyway. I think that 10k already is a real stretch for the market and you must be drinking the Elon KoolAid pretty heavily spiked with something even stronger. Instead of financing, and needed more time to pay it down, I still could use a rewards credit card with an intro rate of 0%.
As for the subscription, not to say they can't increase the price on the subscription going forward either. Subscription makes the most sense for me as I rarely have a car more than 3 or 4 years. One other thing to think about too over that longer term, will the hardware support the needs of the software when it is already 4 or 5 years old without some sort of upgrade like people with older Teslas are looking at now.
For me, and I am not an edge use case I'd imagine, buying FSD outright makes no sense. Not to say that it can't for some but if I did buy it, planned on holding the car for sometime, I'd still worry about having to upgrade hardware down the road and I'd allocate dollars to do that in the future as it is highly likely you'll need to do that.
I think this kind of robust discussion is helpful for people thinking about buying rather than renting FSD. Maybe there will be some massive upgrade in the near future and they triple the price. I can't see any way that would still make me buy in. Not to mention highly unlikely it is going to happen anyway. It would have be at a true level 4 of 5 autonomy me for me to buy rather than rent it. If Tesla gets there in the next 5 years (even to a true 4), I'll be shocked.
Here is a good overview for people not familiar with the levels of autonomous driving. Tesla is current at a 2.
Levels of Autonomous Driving, Explained
As self-driving vehicles move from science fiction to reality, automakers are poised to make critical advancements in this area over the next decade. However, consumers are confused about what constitutes self-driving vehicle technology and what does not.
www.jdpower.com
I would also want to understand their approach to ethics and autonomous vehicles. Will our cars be programmed to crash into a tree rather than hit a school bus? Or to avoid a pedestrian will it stuff us under the semi in the next lane. The higher the level of autonomy, the more I want to understand the decisions and ethics programmed into it. Here is a long read that delves in a bit to the trolley problem that some of you might have had exposure to.
The folly of trolleys: Ethical challenges and autonomous vehicles | Brookings
There are many unaddressed moral dilemmas when it comes to driverless cars.
www.brookings.edu
At this point, I just want my dumb cruise control back. Driving today on a 4 lane highway on my side. The shadow cast into my lane from a truck on the right caused my MY LR to phantom brake at 70 mph with several people pretty close behind me. This one caught me off guard and but I was able to hit the gas again before I got rear-ended.
CapeOne
Active Member
My point here was that if you financed a new Tesla including FSD for at least 54 months at 2.49% APR it would add less than $199/month (the current monthly subscription price) to the monthly cost. The $10k in this case would be part of the overall loan, not money that would need to be taken from savings/investment.
For example, if you financed for 60 months at 2.49% APR it would be around $177/month which is $22 less per month than the subscription. You’d pay around $10,620 ($177 x 60) over five years compared to $11,940 for a subscription over five years and that assumes the subscription price didn’t increase during those years. Additionally, at the end of those five years the purchased (through loan) FSD may add to the resale value of the car whereas the subscription would not.
I was identifying potential financial benefits between financing with FSD included upfront or going subscription over same period which can include:
1. Lower monthly (and five year) cost
2. Protection against subscription price increases
3. Added resale
As far as whether FSD is actually worth they money right now, that's a different discussion.
Marcust99
Member
For my MYP I got in June, I removed FSD 3 days before delivery. I did NOT get dinged with a higher price nor did it change my
delivery date or "space in line". Before doing so I checked with an SA as well as called them and spoke to some manager.
delivery date or "space in line". Before doing so I checked with an SA as well as called them and spoke to some manager.
I got your point about the cost comparison. I guess you missed my point about doing something else with the 10k instead of giving it to Elon. Put it in an account that actually generates a return. Borrow, the 10k, adjusting for the interest cost 2.49, and the time value of money of 11% per annum, that 10k would have been worth about 15k after 5 years. That is what it really cost you to buy it as you lost the opportunity of investing that money instead. Now do the monthly math. It looks like in reality, it cost you about $250/month to buy over the 60 months. I could do a more complex model where you borrow then 10k, invest it, then do the subscription and draw it down $199 month and compute the future value after 54 months.
The future value of FSD would be very speculative at this point. A quick back of the napkin to putting 10k in an account that you borrow at 2.49%, then draw it down to pay the subscription monthly, at my current avg. rate of return puts me at about 4k left in cash at about the 5 year mark. Is FSD worth 4k in 5 years? I doubt it. Not to mention with this approach, I can bail anytime i want and be left with cash rather than something which the value is hard to assess. Again assuming the subscription doesn't increase. I can more easily bail and not renew my subscription if I am forced to do a massive hardware upgrade to get continuing value out of my FSD.
The big questions are; will they increase subscription price and what is the resale value down the road based on your old (by then) hardware? I doubt they can increase it much without a massive improvement in features/performance. I am pretty sure they priced it where they'll get a lot of takers. Go up too much and adoption will likely drop. They need massive 3 & Y adoption to get all the data they need to continue to improve it. i would suspect many (of course not all) of those buyers are more price sensitive. So too high and they won't get the number of cars on the road they need to accumulate the data they need as quickly as possible.
Anyway a good discussion and interesting to see other people's approaches. There may be one thing FSD does amazingly for someone where it is worth 10k. I haven't found anything worth even 1k to me yet. Especially since AP and TACC have a long ways to go as is.
Good for you. When I found a new car in inventory with FSD, back in May, my SA said ANY changes to the car would result in a price increase. Then later when I missed the exact model I wanted from inventory, they were a little more squishy about it.
CapeOne
Active Member
I was more looking at someone deciding between borrowing $80k for a Tesla and getting an FSD subscription versus borrowing $90k for a Tesla that includes FSD. The reality is that both the upfront FSD purchsae (via loan) and the monthly subscription fee have time value of money or opportunity costs. Buying FSD upfront as part of the car loan could still be "better" if say the FSD resale ends up being $1k or more at five years.
CapeOne
Active Member
I'm assuming there will be increases which is why one of my stated "potential benefits" of buying FSD upfront was protection against subscription price increases.
For anyone thinking current Tesla's with current hardware installed, will reach level 5 or even level 4 self driving autonomy? Will go from LA to NYC with no human intervention? That you will make revenue with your cars via robotaxi services? (both promises made by the CEO years ago that both would be realities years ago)
You are fooling yourselves. "bigly"
You are fooling yourselves. "bigly"
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Ryanflynn
2021 MSLR to the moon
If it help you feel better, I have the FSD beta running on mine, and I can see how it will get to the point that its useful and worth it in the nearish future. That being said, I'm just paying my $200/month for it.
