Model S Service Contracts - the poll edition(tm)!

[jerry33]

When you bought your last car, did you spend hundreds of hours examining every detail of how it was made, each and every option available, and place all this under a microscope to critically dissect?

Actually, I did. However there wasn't as much information as we have with the Model S so there wasn't quite as much to dissect. However, the dissection happened one the cars were received.

In looking at the four service price, what I guess you'll get (as a minimum over the four services) is:

1. A service person that actually check things rather than just checking the boxes on the form the way Toyota and VW dealers do ($500). Just being able to talk to the actual person who performs the service is worth a fair bit.

2. Two sets of HID lights ($320). Replaced every two years.

3. Four pairs of wiper blades ($240). Replaced at each service.

4. Eight door handles ($1600). My guess is that the door handles will break frequently.

5. Two brake fluid changes ($200). One every two years.

6. One cooling systems fluid change ($150). At the fourth service.

7. Misc. items ($??)

Even if you eliminate the door handles, there's not a lot of extra there. The perception problem is that a lot of people don't actually service their car. They begrudgingly put in oil on occasion and everything else is fix as it breaks, and if there are three things broken then a new car is purchased. Ideally you want to replace things before they break so that you have dependable transportation--however, doing this isn't particularly cheap.

I'm not thrilled that the price isn't $300/year unlimited miles, which is what I think it really should be (if it wasn't for those pesky door handles) but the price when purchased as a maintenance contract, isn't really out of line at four cents per mile. The TDI I had cost 22 cents per mile for maintenance over 95,000 miles (and there was 36,000 miles free service). The Prius has cost seven cents per mile but that includes tires, without the tires it's five cents per mile for maintenance (poor dealer maintenance cost me almost a set of tires).

So although I'd rather pay less, I can't say with a clear conscience that Tesla is overcharging. We won't really know though until the terms for the second maintenance contract are announced because at 48,000 miles when this contract ends the car is still practically brand new.

 

[Spurkey]

I think many here are missing the difference, and that is showing up in comparisons with annual inspection fees for ICE vehicles.

The Tesla service plan presented is a maintenance contract, not a one-off service fee. Something like Apple Care (which covers you for a time period) vs 'if my phone breaks I'll take it to Apple and pay the repair fee'.

Tesla Service is only an inspection service not a repair plan like Apple Care, so the comparison to ICE inspection fees is valid. My only fear is that they will somehow tie this to warranty validity, similar to a brand new ICE that you drive for 30,000 miles without changing the oil and GM tells you to go fly a kite when you attempt to claim it as a warranty issue, the Tesla service will become a 'required maintenance' item. Some people claimed to have heard this over the phone but I won't believe it until Tesla publishes it.

This would not make me the least bit happy - partly because of the money but moreso because if it costs that much for the first 4 years to keep what was supposed to be a 'lower maintenance than ICE' vehicle on the road, what's it going to cost after that as it ages?

 

[mknox]

As a Roadster owner, I can tell you that Tesla service is world class. (Thank you Jake, Johnny, Joost, James, Jason, and Garrett.) I was bothered by the annual fee until their in-depth inspection uncovered things I had not noticed. (Really, all four shocks? I didn't notice a thing.) The battery is bled, cells are inspected and IF there is a problem, they fix it. Everything is checked. I'd rather invest that money yearly to have things covered, than not.

I don't disagree with this sentiment one bit. What I do disagree with is being told I have to to have the plan "or else". Others have confirmed with Tesla that even items under warranty won't be covered if the inspections are not performed.

Personally, I've never been one for extended warranties, service plans and such, be it on cars or TVs. Have I ever had an expensive repair? Sure, but over the long term, I've saved by paying for problems when they occur, not before.

I think it's great that Tesla offers a service plan like this, but it should be completely optional (just like it is at Best Buy or your typical car dealer) and it should in no way affect any other part of the relationship, including warranty coverage, with Tesla. Those that like the idea of a security blanket - go for it.

 

[neroden]

My answer isn't in the poll.

My answer is that I think it's somewhat (not severely) overpriced for what I'm going to use, but I will get the $2400 option and simply consider it part of the price of the car, because I want *no hassle*. I have enough hassle in my life that I'm willing to overpay a bit for *no hassle*.

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I don't disagree with this sentiment one bit. What I do disagree with is being told I have to to have the plan "or else". Others have confirmed with Tesla that even items under warranty won't be covered if the inspections are not performed.

That's a violation of the Magnusson-Moss Warranty Act and someone will probably nail them for it if they actually do that.

 

[stopcrazypp]

For comparison, the Leaf manual strongly recommends brake fluid changes every 15k miles, which comes out to $200-300 (usually includes cabin air filter change).

The annual checkup is free though, except for this point.

http://news.consumerreports.org/cars/2011/07/zen-and-the-art-of-nissan-leaf-maintenance.html
http://www.mynissanleaf.com/viewtopic.php?f=27&t=8761

 

[neroden]

....so I understand why Tesla wants to inspect everyone's car. It's a new car, they don't *know* what sort of parts are going to fail regularly, they could have all manner of warranty-covered repairs and not know why they're happening unless they have a larger sample to inspect.

But they should have simply included the $1900 or $2400 in the price of the car and made it a "free service". Then nobody would be complaining (except the people complaining that the car was priced too high, which they're doing anyway).

(Edit: note that the reason I said the service was overpriced *for me* is that I don't drive much. I'm probably not going to hit 20,000 miles within the warranty period. For people who drive huge numbers of miles, the service is probably appropriately priced.)

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If getting access to some of the "hardware" updates is included, then it may be worth it. There has been talk of adding parking assist, adaptive cruise and blind-spot detection to existing cars after the fact.

That would indeed be worth it.

 

[stopcrazypp]

I understand why Tesla priced it this way, it's to cover the large overhead costs of servicing the Model S, given the service centers have no other revenue stream (unlike other companies which have a large number of out-of-warranty vehicles to service). It's still expensive though for most people.

 

[neroden]

In my opinion this is a nickel and dime practice that I would have though Tesla was better than. I guess in this regard, Tesla is behaving like their American/Domestic auto brethren. Should I anticipate the question from my delivery specialist, "do you want the special protective undercoating spray?"

Bingo. Tesla behaves exactly like other auto dealers, nickel-and-diming its way to profit with "required options".

I'm beginning to see how the other auto manufacturers and dealers ended up adopting this model. First you announce your car and you announce the base price of the car. Then you go to build it, and whoooops, it costs more to make than you thought, and you're not profitable. Rather than admit that you underpriced the car and raise the base price, you convert a bunch of practically-mandatory stuff into "options" and milk the option prices for all you can get.

Perhaps every carmaker went through this process.

I suspect Tesla will soon discover why carmakers started franchising dealerships, too, as Tesla proves unable to expand its Stores and Service Centers fast enough to meet demand. Suddenly the extra availability of capital (provided by the independent car dealers) to start new stores and service centers will seem very valuable...

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The prepaid 4 year service plan is $1,900, plus $100 for every ranger visit if you won't/can't bring the car into a service point. Maximum cost is §2,300
The prepaid 4 year service plan with unlimited ranger visits is $2,400.

That is $500 for unlimited ranger visits (in fact limited to up to 4 visits) versus between $0 and $400.

To me it looks you pay more for the plan with unlimited ranger visits and get less. Is my math flawed or is this poorly priced by Tesla?

You're not figuring it right. Consider someone who is going to need ranger service every single time (say, over 300 miles from a service center -- perhaps in Hawaii). (Practically speaking, I feel that I am in that position; the nearest service center is 222 miles away in a direction I never go, and it could theoretically be reached for annual service if I order the largest battery.) That's $1900 for the "annual service" + $400 for the required ranger fees + $100 for *unlimited additional ranger calls*, in case, you know, the car actually breaks.

So anyway, if you're in that position, then instead of paying $100 for each "broken car visit", you're paying $100 for *all* "broken car visits". If your car never breaks, it was a wasted $100. If it breaks once, you break even. If it breaks twice, it was worth it.

It is clearly targeted at people who are hundreds of miles or more from the nearest service center.

 

[SuperCoug]

Really disappointed with this...

So is I take this is an annual 12-month service regardless of miles (under 12,500)?? So if I only drive 6,000 miles in the first year, it's an additional .10 a mile ($600) for service? Are you joking? or is it $600 for every 12,500 which could take 2 years to hit? What's the penalty if I forgo the service? Invalidate the warranty?? Isn't a law that I can't be required to go to the dealer for maintenance service for warranty purposes?
:

I'm also really disappointed, however I'm worried about the HIGH usage scenario. I anticipate putting more than 20,000 miles per year on my Model S so am I expected to pay for more than one of these $600 12,000 mile check ups every year?!? Tesla knows darn well that they are not going to have to replace anybody's brake pads in that first 50,000 mile period so it is really easy for them to include it with the service plan. Wiper blades? Give me a break, if I need new wiper blades I'm not going to want to wait until my service appointment to get new ones.

Bottom line: $600 per year for routine maintenance while under warranty is NOT CHEAP and Tesla has got to stop talking about their low cost of ownership! It is far more than a typical car, even a premium car like my Mercedes Benz. I thought $150+ for my 13,000 mile Mobile One oil change was a ripoff. The lack of expense routine service (like oil changes) is one of the key perceived benefits of an EV.

 

[neroden]

Also, nothing is free. I'm sure BMW is getting paid for their 'free maintenance' during the first 4 years by bundling the cost into their car.

Yeah, but from a marketing point of view BMW's is a preferable pricing scheme.

I think Tesla screwed up by fixating on the "sub-$50,000" target. They've been nickel-and-diming to make up for it. I like to know my costs up front. Now that I'm adding them all up, the total is still coming in under my limit -- I expected from day one to be paying a tad under $100K for my car -- but I imagine that people who were less pessimistic about the pricing are going to be quite upset.

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But how often have you had to replace your brake pads before 50,000 miles. I've never had that done.

Actually, just had brake shoes replaced on a car with about 30,000 miles on it because we'd burned through the brake pads without realizing.
It's all hills and stop-and-go around here...

...of course this didn't happen until the car had been owned for 8 years. I wouldn't expect to replace brake pads before 4 years were up!

And with regen I would expect pads to last about 100,000 miles.

Regen should indeed improve that situation massively.

 

[ddruz]

I wrote to my Tesla rep this morning and received emailed answers to a few questions about the service contract which hopefully will be helpful and prevent some unsupported speculation:

1. Tesla Ranger warranty visits, if needed, as well as service visits are included in the "4 year anywhere" plan.
2. Tire rotation is included in the annual service visit.
3. When asked if a person elects to go without any service plan will they get any kind of software updates? "Service plans, the annual service, and warranty have no bearing on software updates. All Model S owners are eligible. However, some updates may require a service technician or a service visit to complete"

 

[chmod a+wrx]

As a Roadster owner, I can tell you that Tesla service is world class.

I don't doubt you......service for 2300 Roadsters probably is world class......

How's service for 20000 Model S's and 2300 Roadsters??????

 

[stinnett_P813]

I have not been unhappy with anything Tesla has done up to this point. But this just pushed me over the edge. If they planned to do this kind of BS they should have done this PRIOR to making us all lock in our orders and thus forfeit our 40k/5k deposits. This kind of announcement is necessary prior to locking us in. And now we are being forced into adding another fee just to keep our car under warranty by doing what will amount to a worthless inspection?

Next week they will announce that if you want software updates you will need to pay another $2400 for four years of updates. If you don't buy these updates you will be out of warranty coverage.

And the week after that their announcement will be, if you want some of their other "features" like the sunshade or the folding mirrors, you will HAVE to buy them and if you don't buy those features you will be out of warranty coverage.

And then the week after that they will announce that they will hold your car hostage and keep it from starting if you don't pay them their annual hostage fee.

Gee, my 100k car is going to cost me 150k.

 

[neroden]

Pet peeve but blind spot detection, adaptive cruise control, auto braking when backing up (in about 90% of vehicles), and back up (front bumper) sensors are NOT safety features. They are crappy/lazy driver crutches.

I would agree except that according to every review, the Tesla model S has bad visibility on the rear-view mirrors -- there are blind spots where it's practically impossible to adjust the mirrors to see them -- which makes blind spot detection *much* more important.

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Once again, if you don't think you will need the product, don't pay for maintenance yearly. It can't void your warranty.

It can, however, cause Tesla to *behave obnoxiously* about your warranty. And Tesla has given repeated indications that it will do so. (This is bad, given that Tesla is dancing on the edge of violating Federal law.)

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I can say that it was made quite clear to me that the $600 annual maintenance on the Roadster was not optional. The logic used was that the AC needed to be tested and or charged each year to guarantee the required cooling for the battery pack. So unless things have changed I certainly expect the battery warranty will be contingent on annual service.

But the A/C system is completely different on the Model S.

 

[jimbakker666]

...i don't know...i'm getting all bent out of shape and i haven't even put down a reservation yet....

...i guess i see this really awesome thing drifting away....

I've been there dude. I had a reservation a year ago and canceled after options pricing was released for what I felt was dishonest advertising by Tesla. I'll admit feeling a growing sense of vindication here as people become pissed at the 'less maintenance than an ICE' claim...you wouldn't believe how much crap I got from people for calling out Tesla on their marketing tactics. It was pages worth of people bizarrely rationalizing for Tesla and telling me that I naively set my expectations too high.

By all accounts Tesla has crafted a remarkable vehicle...yet they can't keep from sabotaging themselves with their marketing practices. It sucks to watch from the outside. I want them to succeed but I know they won't if they keep this up. First it's the 'delivery fee' that can't be waived, even if you take delivery at the factory. Now it's this costly maintenance plan that may or may not be mandatory for warranty coverage. Anyone want to chance a guess on the price of network access? Supercharger access?

 

[neroden]

just as one additional data point that i haven't seen mentioned. The service plan also includes 24 hour roadside assistance. I know i personally pay $100 a year to AAA for that currently. So if you factor that in, the 475 a year for the prepaid becomes much more reasonable looking.

I think a lot of us already have AAA, and I'm not going to drop my membership (apart from the roadside assistance, they offer free maps, which I have a great fondness for, even though I know everyone uses electronic maps now). Furthermore, I think AAA roadside assistance is likely to respond up to *five hours* faster than Tesla, given that I'm 300 miles from the nearest service center -- does Tesla have contracts with companies in *every county*? Although on the other hand, I'm not sure if AAA roadside assistance would agree to a 300 mile tow to the nearest dealer (gotta check the fine print). Hmm.

 

[SuperCoug]

The remote monitoring looks like ONSTAR or BMW Assist which I expect to pay some amount of money for.

ONSTAR provides MUCH more functionality than what Tesla is talking about providing with their remote monitoring. There are different classes of ONSTAR service and Tesla is charging more than even their highest price concierge style ONSTAR service.

 

[neroden]

from the TM forums:

Before this was announced, I asked at my local store the exact question:

"If I don't pay for yearly maintenance, can I still get software updates over-the-air? And will my car still be monitored for problems? And will I void the warranty if I don't get the yearly maintenance?"

The salesperson at the store said you will get updates regardless, your car will still be monitored, and the warranty is only voided if the car notifies you of a problem and you don't get it promptly fixed.

It's not mandatory.

I refuse outright to pay for an annual or monthly "wireless" fee of any sort, so how are they going to monitor my car?

(emphasis mine)

and the warranty is only voided if the car notifies you of a problem and you don't get it promptly fixed.

Now *that* is what Tesla should be emphasizing. I'd like to see that in writing.

 

[donauker]

But the A/C system is completely different on the Model S.

The battery pack is still going to be dependent on it for cooling.

 

[neroden]

I pulled out my service records for my 2008 Lexus 350RX to compare my known costs for maintenance as all warranty work (1 item) was done at N/C.

....

1K miles: N/C check-up by Lexus that car is as it should be.
5K miles: N/C oil and filter change; Lexus provides the first oil/filter change free
10k miles: $200
15k miles: $340
20k miles: $160
25k miles: $160

And I don't expect to do more than 25K miles in the first four years, so stop right there and compare $860 to Tesla's $1900-$2400.

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The battery pack is still going to be dependent on it for cooling.

I have a regular HVAC guy who knows how to inspect and repair air conditioning systems. Perhaps Tesla should actually provide the A/C inspection manual?