Has anyone done the math to see if it is cheaper to add AP after taking delivery? I know it costs $1K more at first, but with the registration and insurance savings based off a $5K cheaper car..... Who knows?
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Is AP cheaper to buy after delivery?
- Thread starter insaneoctane
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- Model 3
I put some numbers through the CA DMV registration calculator a while back and I came up with $609 (cant remember, but I think it was based on $51,500 cost). So registration wise, adding another $5k to the cost of the car isnt going to make a significant difference versus the additional $1000 for EAP afterwards.
Yes. If you bought a Tesla without AP on December 29 last year, putting that money you would have spent on TSLA stock instead, and cash out today with the intent to buy AP wit hthat same money, you get it for $650 less than you would have paid last year even after the increased $1000 price of the late upgrade.
This is without even taking into account interest payments on the price of the autopilot option if you financed the car.
This is without even taking into account interest payments on the price of the autopilot option if you financed the car.
I don't think that it would be cheaper for year #1, but insurance and registration happens every year.
Mishakim
Member
In my state, and I think most, insurance and registration/ tax rates after purchase are based on model alone, not options or sticker price at purchase.
Derek Kessler
Active Member
Insurance is more concerned with medical costs then the car itself. I moved from a 2007 Honda Civic with 180,000 miles to a Model S and my insurance was higher, but not astronomically so. If somebody is hurt in an accidental, odds are good the insurance payout for their medical expenses will far surpass whatever the insurance has to spend on the car repairs or replacement.
Why even look at insurance on the higher price? If you finance the car at 2% for 3 years, a $5000 autopilot option costs you $143 every month. It makes sense to simply put that money into something that will earn you money and cash it in when you're ready for a profit.
In Nebraska it would save me $825 over 5 years for registration and sales tax. That would mean a loss of $175 based on a $1,000 extra it would cost. I would report it to insurance for safety savings and if totalled they would pay the extra cost.
I hope they offer a 1 week trial with no extra upgrade cost.
I hope they offer a 1 week trial with no extra upgrade cost.
Is tax charged if selected for delivery, but not if it's added later, or are you referring to sales tax on registration?
I honestly don't know what they are based on.....Does anyone know if the actual price only matter for year #1 in California?
cschock
Member
In CA the registration cost is based on the purchase price of the vehicle as is the sales tax. Subsequent years of registration are reduced by a fixed percentage of the vehicle purchase price. Since adding the option afterwards is NOT taxed you save the sales tax on the purchase as well as reduce your registration cost each year. I don't know the exact depreciation formula for subsequent years, but it appears to knock off 10% of the value of the car per year at least for years 1-5 based on my fees paid and I know years 11 to infinity are always the same.
Assuming sales tax at 8 percent (which is low in a lot of parts of CA, state rate is 7.5 but local rates added on) you get a savings on sales tax of $400 right off the bat. Registration based on value of the vehicle is .65% of the vehicle each year, depreciated each year by 10% of the purchase price. At year 10, you will have saved 3.575% additionally of the 5000, or only another 178.75 for a total saved of $578.75. Thus, the actual cost over 10 years to add the option later is "only" $421.25.
Is this historically true? I looked into this before and had thought tax would be charged. A quick google shows this thread where some appear to say they were charged, with others saying the law says they shouldn’t be charged.
Sales Tax on EAP | Tesla
cschock
Member
Pretty sure that you are not supposed to be charged for downloaded software in CA. Now, what they actually do, I do not know as I haven't ever done it through Tesla.
CSCHOCK had a good explanation. In Nebraska you should not be charged for a download especially since they do not have a store here. You technically might have to claim it on you yearly taxes and pay sales tax at that time but less than 1% of people do that.
With 7.5% sales tax my 5 year difference on $41k vs $46k sales price is $2,800 vs $3,655 if my numbers are right. If I could do it for a battery unlock it would be even better.
Here is the Nebraska registration costs.
With 7.5% sales tax my 5 year difference on $41k vs $46k sales price is $2,800 vs $3,655 if my numbers are right. If I could do it for a battery unlock it would be even better.
Here is the Nebraska registration costs.
I think you also need to remember that if you are financing the car you will pay interest each year on the $5,000. Then there is the logic fact of why pay for something that cannot be fully used until it is working 100%. Just my opinion. We have people out there who leased with FSD. The odds are looking like it will never be used before they turn in the car.
I just went through this thread and @cpa seems to offer a valid reason why Tesla does charge tax on EAP
No sales tax on EAP upgrade online in Cali?
Ok, thanks for the link that appears to show that in California we pay tax either way (I am so shocked).
Here is the CA Vehicle Registration savings of spending $5K less on the car over 11 years....
So, now I need the insurance savings.... Likely that it's Not looking clever anymore.
PS- this research uncovered the fact that California registration will go from about $450 for a $60K car in 2017 to $600 in 2018 due to the new "Transportation Improvement Fee". If you voted for that, then F you very much....
Here is the CA Vehicle Registration savings of spending $5K less on the car over 11 years....
Code:
year cumm savings
1 $32.50
2 $62.40
3 $89.38
4 $113.75
5 $135.20
6 $154.05
7 $169.98
8 $183.30
9 $193.70
10 $201.50
11 $206.38So, now I need the insurance savings.... Likely that it's Not looking clever anymore.
PS- this research uncovered the fact that California registration will go from about $450 for a $60K car in 2017 to $600 in 2018 due to the new "Transportation Improvement Fee". If you voted for that, then F you very much....
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If you can buy the AP after the fact with a credit card, you can probably factor in about $100 in credit card rewards.
For me, putting it on a chase card that gets 1.5%, that 9,000 points would be worth $135.00 for travel.
ps. Why are my dmv fees $42 more than last year, if it's supposed to decrease?
For me, putting it on a chase card that gets 1.5%, that 9,000 points would be worth $135.00 for travel.
ps. Why are my dmv fees $42 more than last year, if it's supposed to decrease?
You would hope that $8,000 in software wouldn't be figured in on the price of a car for insurance purposes.
