Cost of a Model 3 vs. ICE

[rodrego66]

As I near the deliver of my M3 RWD Tesla, my wife is having a little anxiety. I have tried to assure her that over the life of the vehicle it would be a savings. But she asks, "why can't we just get a $20,000 car?" I was averaging some costs of the ICE versus the Tesla and while the initial cost is obviously higher, I think the five year cost is less. If I figure the cost of $20,000, plus gas ($3 per gallon), other maintenance, plus higher registration, extended warranties, etc. The cost of a $20,000 car over 5 years is roughly $42,000. Wheras, the cost of a $50,000 Tesla, plus $3,500 for tax title license, cost of elect, future registration, it is less than $40,000. So the difference is marginal, but I am obviously getting a much nicer car.

Am I missing anything?

 

[mspohr]

As I near the deliver of my M3 RWD Tesla, my wife is having a little anxiety. I have tried to assure her that over the life of the vehicle it would be a savings. But she asks, "why can't we just get a $20,000 car?" I was averaging some costs of the ICE versus the Tesla and while the initial cost is obviously higher, I think the five year cost is less. If I figure the cost of $20,000, plus gas ($3 per gallon), other maintenance, plus higher registration, extended warranties, etc. The cost of a $20,000 car over 5 years is roughly $42,000. Wheras, the cost of a $50,000 Tesla, plus $3,500 for tax title license, cost of elect, future registration, it is less than $40,000. So the difference is marginal, but I am obviously getting a much nicer car.

Am I missing anything?

What car can you buy for $20,000?
Stripped down Fiat 500?

 

[rodrego66]

What car can you buy for $20,000?
Stripped down Fiat 500?

Was just looking for a newer version of what I have now which is a Dodge Charger, used is just over $20,000

 

[Msjulie]

past vs future I guess... environmentally cleaner, quieter, quicker and of course personal but not unique opinion here - Tesla is orders of magnitude more cool...

 

[P85_DA]

Was just looking for a newer version of what I have now which is a Dodge Charger, used is just over $20,000

Yah the ICE will be cheaper ..your cost calcs don’t include cost of financing , tax credits etc..,,the raw numbers you show the Charger is cheaper ..your wife is right ... if u want proper calcs consult @KCapital

 

[trunks13]

What's the cost of a Kw of electricity where you live? I think that's probably the biggest determining factor.

 

[goodjon24]

Don't forget depreciation. Let's just say it's a flat 15% per year, after five years the Tesla would be $22,185 left in value (27,815 cost). You're 20k car would be 8,874 in value ($11,126 cost). Those numbers aren't exact of course, but the depreciation will be proportionate to the value of the vehicle.

 

[corduroy]

No question, ICE is cheaper. You will never recoup the cost of buying a Tesla. But it's the price we pay for being early adopters of EVs and also the intangibles

 

[mspohr]

Was just looking for a newer version of what I have now which is a Dodge Charger, used is just over $20,000

Apples, oranges...
If you're going to compare new with used, used will be cheaper in the short run but more expensive over time.

 

[insaneoctane]

Doesn't seem like a fair comparison with used vs new....

If you drive a lot (20K+/yr), gas is expensive ($3.50+/gal), and electricity is cheap (<$0.15/kWh), you can probably break even (maybe a bit ahead) with a comparable new ICE....otherwise, just spend a little more, enjoy the car and help save the world!

 

[RayK]

Assuming that the OP intends to keep the car until it dies, depreciation shouldn't enter into the calculations.

What might be missing is the assumption of future price increases in gas and electricity. It's pretty much a given that neither will drop in price in the next couple of decades but estimating what that would be is difficult. Also not taken into account is the repair costs and insurance that's involved. Currently, it appears that repairing a Tesla might be 2 to 3 times more expensive than a traditional new ICE vehicle, assuming similar repairs (like bodywork damage). Insuring a Tesla is definitely going to cost more when compared to almost any used car (Ferrari and Lambos aside). And as far as I know, the replacement cost for a new battery pack out of warranty is currently unknown.

Overall, it's probably more expensive for owning a Tesla 3 over the long run than a similar-sized ICE of the same age/class.

 

[Asymmetry]

As I near the deliver of my M3 RWD Tesla, my wife is having a little anxiety. I have tried to assure her that over the life of the vehicle it would be a savings. But she asks, "why can't we just get a $20,000 car?" I was averaging some costs of the ICE versus the Tesla and while the initial cost is obviously higher, I think the five year cost is less. If I figure the cost of $20,000, plus gas ($3 per gallon), other maintenance, plus higher registration, extended warranties, etc. The cost of a $20,000 car over 5 years is roughly $42,000. Wheras, the cost of a $50,000 Tesla, plus $3,500 for tax title license, cost of elect, future registration, it is less than $40,000. So the difference is marginal, but I am obviously getting a much nicer car.

Am I missing anything?

Wife has a point, if it for her just get the cheapy ICE.

For Tesla, lower servicing costs.
Against, accident repair, insurance, depreciation.

Depends if you like the car and your financial position, if you're getting more debt that you comfortably afford then don't.

My wife made the same point, she is right but was harder to argue getting CPO one that is 1 year old at 25% less than new.

 

[KenF]

Don’t kid yourself. You are not buying a Tesla to save money. You buy a Tesla for the same reason you bought that early iPhone over a flip phone. It’s a glimpse of the future that you can buy and drive now. It is not the most cost effective or pragmatic option. That would be something like a Honda Fit or a Mazda 3.

 

[rodrego66]

Don’t kid yourself. You are not buying a Tesla to save money. You buy a Tesla for the same reason you bought that early iPhone over a flip phone. It’s a glimpse of the future that you can buy now. It is not the most cost effective or pragmatic option. That would be something like a Honda Fit or a Mazda 3.

Absolutely correct, however, I was trying to compare comparable models. The Honda Fit would be way to small for me to fit in. I currently drive a Dodge Charger and would probably buy another one (or similar size) when I need another vehicle. My guess if I bought a new ICE about the same size it would be about $28,000 or more. I was looking at a Hyundai Sante Fe and they start at about $28,000. I am guessing with upgrades it would be about $35,000. If I factor this, the cost might be a little closer.

 

[JonathanD]

As I near the deliver of my M3 RWD Tesla, my wife is having a little anxiety. I have tried to assure her that over the life of the vehicle it would be a savings. But she asks, "why can't we just get a $20,000 car?" I was averaging some costs of the ICE versus the Tesla and while the initial cost is obviously higher, I think the five year cost is less. If I figure the cost of $20,000, plus gas ($3 per gallon), other maintenance, plus higher registration, extended warranties, etc. The cost of a $20,000 car over 5 years is roughly $42,000. Wheras, the cost of a $50,000 Tesla, plus $3,500 for tax title license, cost of elect, future registration, it is less than $40,000. So the difference is marginal, but I am obviously getting a much nicer car.

Am I missing anything?

Ask her if she wants to feel like this

 

[Nuclear Fusion]

As I near the deliver of my M3 RWD Tesla, my wife is having a little anxiety. I have tried to assure her that over the life of the vehicle it would be a savings. But she asks, "why can't we just get a $20,000 car?" I was averaging some costs of the ICE versus the Tesla and while the initial cost is obviously higher, I think the five year cost is less. If I figure the cost of $20,000, plus gas ($3 per gallon), other maintenance, plus higher registration, extended warranties, etc. The cost of a $20,000 car over 5 years is roughly $42,000. Wheras, the cost of a $50,000 Tesla, plus $3,500 for tax title license, cost of elect, future registration, it is less than $40,000. So the difference is marginal, but I am obviously getting a much nicer car.

Am I missing anything?

How much would ditching her save?

 

[insaneoctane]

Is this about numbers or emotions? The Chevy Bolt will collect all of the EV savings of a Tesla for pennies on the dollar. But then you are driving a Chevy....

 

[MXWing]

Every Tesla vs ice calculation I have found to be extremely wrong.

People are biased towards getting a Tesla so savings are exaggerated and costs are minimized.

With that said however.. 2018 is a good year to get a Tesla - as your vehicle takes a lower depreciation hit vs other Tesla’s in 2019 due to the tax subsidy that is halved.

 

[MXWing]

Is this about numbers or emotions? The Chevy Bolt will collect all of the EV savings of a Tesla for pennies on the dollar. But then you are driving a Chevy....

How do you figure pennies on the dollar? Bolts are not THAT cheap. That and its relatively terrible vs a Tesla for drives outside your immediate metro.

 

[gtmotor]

I've unfortunately talked a few of my friends out of buying a Tesla for this very reason. If you're not in a financial position to buy the newest luxury on the block then please reconsider. I've also helped those same friends start a financial plan so they can be on a path to get one someday

Don’t kid yourself. You are not buying a Tesla to save money. You buy a Tesla for the same reason you bought that early iPhone over a flip phone. It’s a glimpse of the future that you can buy and drive now. It is not the most cost effective or pragmatic option. That would be something like a Honda Fit or a Mazda 3.