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Poor Man's Model S

Discussion in 'Model S: Ordering, Production, Delivery' started by Alexander, Nov 23, 2012.

  1. Alexander

    Alexander P# 8,878

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    #1 Alexander, Nov 23, 2012
    Last edited: Dec 20, 2013
    I have a reservation to a Model S, but I don’t make enough money to afford this car, nor can I justify the high payment… or at least that’s what I thought.

    Here is the situation; I’m self employed, I’m in the Marine Corps Reserves, I’m a single dad, and my take home pay is about [REDACTED] in a good year. I drive a lot for work so I’m forced to have two cars: A Honda Insight for work, and a Honda Accord for getting my little one around. As a result, I have all the expenses that go along with having two cars and it really chips away at my income.

    When I discovered the Model S, I was looking for that one car that could do it all. A car that could give me the same gas millage (66 Mpg or better) as my Insight, and a car that had more or less the same amount of space as my Accord… I found the Model S to be the ONLY car that meets this criteria. It really is a car without compromise. Only problem is that I thought it was too expensive… so committed to forgetting about it and just continued about my existence.

    But I couldn’t stop thinking about it. There had to be a way, the car is just too perfect for my situation… 9 months go by before I remember something I learned in business school. For whatever reason, the words “Total Cost of Ownership” popped back into my brain. I remembered this and I thought… maybe… just maybe the numbers work.

    So one night after putting my daughter down to sleep, I booted up the computer, opened an excel spreadsheet, and start running the numbers. This is what I came up with.

    On average over the last 3 years, my cars have cost me $10,653.62 in gas, maintenance, and repairs. Here is the breakdown in what I spend on average each year:

    $3,485.62 in gas
    $3,985.00 in maintenance
    $3,183.00 in repairs

    If I buy a Tesla, with the 85kWh battery (which comes with the 8 year, unlimited miles warrantee), I’ve estimated that I will spend $2,369.15 a year driving the same distances! Here is the breakdown:

    $819.15 in energy (based on my current rate for 1kWh)
    $1,550.00 in maintenance (tires, breaks, & washes)
    $0.00 in repairs (thanks to the warrantee)

    That means that if I buy the base Model S, with the 85kWh Battery for $64,436 (price includes license, tax, and registration), then in 4 years the car will have paid for itself! Leaving me 4 more years (the length of the warrantee) to continue to rack in the savings! AND, ill save on not having to insure two cars!

    So like a good tactician, I laid out a plan and got to work on executing it. The plan is to sell my two cars to come up with the down payment. For that reason I’m glad the waiting list is 9 to 12 months long. It’s given me time to pay off my Accord so that I can turn that equity into a larger down payment. While my monthly payments will be much larger on the Model S then on my Accord, my other automotive expenses will drop so that either way ill still save money.

    It took me 9 months to realize this, and once I did I put my reservation in. All my fellow Marines think I’m crazy, and maybe I am… after all I was crazy enough to join right? lol

    But ill be spending the money one way or the other. Might as well spend the money on a nice car instead of throwing it away in gas or costly repairs. My only concern is the warrantee and what it covers. Like my Hybrid (which are money pits if you ask me), the Tesla is just one major repair away from blowing all those savings out the window. I hope the car is as reliable as everyone thinks it will be, or at the very least the warrantee will cover all major repairs. Just have to wait and see I guess.

    Either way, I thought I might share my story. My business is growing (slowly), so someday I hope I’ll get to a point where I don’t have to think about these things. But for now I’m excited I can get into one of these things. I’m at the “Finalize your order” stage so my delivery is just around the corner!

    See you on the road!
     
  2. ckessel

    ckessel Active Member

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    The Insight can't hold your child?
    How are you getting the base 85kwh for that price? The price is $70k after the tax credit.
     
  3. Zzzz...

    Zzzz... Member

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    #3 Zzzz..., Nov 23, 2012
    Last edited: Nov 23, 2012
    I'm sorry to be somewhat negative, and really hope you still gonna buy Model S, but actual price for 85kWh starts at $69,900. That price does not include delivery fees, taxes etc, but with $7500 tax credit already counted in(or $77,400 without counting it).
     
  4. dsm363

    dsm363 Roadster + Sig Model S

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    Great story, thanks for sharing and for your service. During the warranty period, you should be ok in terms of major expenses. Afterwards, things could get very expensive. Are you able to write any part of the car off as a business expense? Also, the tax credit is only maxed out if you pay more than $7,500 in federal taxes. I agree above, are you actually talking about the 40kWh car pre tax credit?
     
  5. Alexander

    Alexander P# 8,878

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    ckessel - My little one is only two and a half. State law wont allow me put her in the front seat for saftey reasons. I get another $2,500 rebate from the state.

    - - - Updated - - -

    Oh, and that price of $64K takes into account what I’ve saved for the down payment. I copied and pasted that number from my spreadsheet without thinking. That’s what I have to finance after selling my cars.
     
  6. ckessel

    ckessel Active Member

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    #6 ckessel, Nov 23, 2012
    Last edited: Nov 23, 2012
    The Insight doesn't have back seats? You said you were "forced" to have 2 cars. It sounds more like a choice though.

    I'm all for going for it, it was just very confusing. You mentioned being a tactian which means starting with facts, but that first part seemed more preference than fact so I was instantly thrown trying to figure out what's going on with those 2 cars that didn't line up.

    Now, if it's that you prefer having the 2 cars based on their profiles, I understand, it just means you're currently spending on two cars by choice which is of course going to make the numbers look better for switching to the Model S than if you just had one car.
     
  7. bonnie

    bonnie Oil is for sissies.

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    Alexander - Congrats on figuring out how to afford a Model S. It sounds like you've done your homework. And welcome to the forum. :)

    (people don't mean to sound negative - and I'm sure you can handle it just fine.)
     
  8. Sig698

    Sig698 Model S Sig Perf #698

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    Sounds like, also based on the mpg, he has a first generation insight.
     
  9. jerry33

    jerry33 S85 - VIN:P05130 - 3/2/13

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    The original insight was a two seater (makes the Roadster look big). A good driver could easily get 75 mpg while carrying two sacks of groceries. That's about the limit of it's cargo room though.
     
  10. Alexander

    Alexander P# 8,878

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    #10 Alexander, Nov 23, 2012
    Last edited: Nov 23, 2012
    I have a 2000 Honda Insight which only has two seats. With the amount of driving I do and gas prices, it would become cost prohibitive for me to drive anything else for work. Even 66Mpg doesn't feel like enough.

    I looked into a Prius and a Volt, but most other hybrids don't even come close to my Insight's efficiency (the CR-Z was a let down in that regard) and the Volt just didn't have the range. I once hyper-miled my Insight up to 108.4Mpg. But most of the time I'm between 44.6Mpg (worst, never been below that) and 86.7 (best). Insurance on my Insight is also peanuts compared to most cars. So the Insight is cheaper to drive in that sense since insurance companies base part of their rate on the amount of driving you do.

    I don't mind negativity, we're trained to dish it... besides, it can be constructive
     
  11. ckessel

    ckessel Active Member

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    Ah, ok. I looked at Google images for Honda Insight before I posted and they were all 4 seater, hence the added confusion.
     
  12. Alexander

    Alexander P# 8,878

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    Yea, I forgot that they updated it to be a five seater. Should of been more specific.
     
  13. 49er

    49er Member

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    Alexander, I don't mean to sound negative, but I think the reason Model S may seem "affordable" in your calculations is that you are paying a lot to operate your automobiles currently. According to your numbers, you are spending over $7000/yr in maintenance and repairs for your two current cars. That's almost $600/month, and that does not include your fuel costs.

    Have you checked out the Volt, Plug-in-Prius, Camry Hybrid, or some other vehicle to see if it could fit your needs and deliver (relatively) high MPG? The payment on that car could easily be under $600/month; for example, Chevy Volts in southern California can be leased for $300-350/month (check gm-volt.com forums for more information). It will be hard to match the MPG of your Honda Insight, so your fuel cost will go up, but if your annual mileage is split 50/50 between your Accord and your Insight, you should still come out ahead.
     
  14. Grendal

    Grendal Active Member

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    Alexander. First, thanks for your service. Second, what is your driving like? How far is your commute? Do you take trips on a regular basis? Etc...

    49er's Volt idea created these questions. The Volt mileage varies greatly depending upon your normal commute.
     
  15. PRJIM

    PRJIM Member

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    Great information and story! This is my understanding of the warranty.

    The 8 year warranty only applies towards the battery, the bumper to bumper warranty is for 4 years or 50k miles.
     
  16. vfx

    vfx Well-Known Member

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    Did I miss that you did not include the annual $600 for the Tesla S once a year checkup? Brakes(sp) though are infrequent.

    Also are you able to install solar? Companies like Solar City have a pretty much "zero" installation lease cost and would further reduce your fuel costs.
     
  17. Alexander

    Alexander P# 8,878

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    I have, and the new Hybrid's don't make a lot of sense (for me anyway). I dive at least 200 a day for work, so the Volt doesn't make sense since its EV range is so limited. Other Hybrids are just a joke. My Insight was one of the first Hybrid's ever built, and it gets 66Mpg. I challenge anyone to find a modern car that can go 600 consecutive miles on 10 gallons of gas. They just doesn't exist.

    I love my Insight, and I've had it for over a decade, but I will never own another Hybrid. Maintaining those two power trains is a pain and the warranty's on all those parts can get dicey. Fortunately for me, Honda has a deep rooted interest in keeping my car on the road. Ive had to replace my 144V battery three times - after warranty - but Honda picked up the tab each time because the 1st Gen Insight is to Honda, what the Model T is to Ford.


    The Model S 85kWh has just enough range to work for my situation. M
     
  18. jerry33

    jerry33 S85 - VIN:P05130 - 3/2/13

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    I hear you. However, I have done fairly well in my 2004 Prius:

    --- Trip to NE starts here
    01/07/12____128603____481____56.6 (4.2)
    -- 13 F here
    01/12/12____129042____438____52.7 (4.5)
    01/15/12____129420____378____50.3 (4.7)
    01/20/12____129094____481____56.2 (4.2)
    --- Trip to NE ends here
    01/31/12____130503____600____69.8 (3.4)
    02/23/12____131050____546____69.4 (3.4)
    03/07/12____131679____629____72.2 (3.3)
    03/23/12____132319____638____71.3 (3.3)
    04/12/12____132987____668____74.0 (3.2)
    05/02/12____133647____659____74.3 (3.2)
    05/18/12____134272____624____73.4 (3.2)
    -- Flat tire here
    -- High temperatures start here
    06/06/12____134907____634____74.1 (3.2)
    06/22/12____135557____650____74.2 (3.2)
    07/11/12____136210____652____74.3 (3.2)
    08/02/12____136901____690____75.8 (3.1)
    --- Trip to NE starts here
    08/03/12____137499____597____57.8 (4.1)
    08/04/12____138145____645____61.7 (3.8)
    08/11/12____138646____601____58.8 (4.0)
    08/12/12____139286____539____59.5 (4.0)
    08/22/12____139881____595____64.1 (3.7)
    --- Trip to NE ends here
    09/07/12____140529____647____75.4 (3.1)
    09/25/12____141223____694____75.0 (3.1)
    -- High temperatures end here
    10/11/12____141883____659____75.6 (3.1)
    10/30/12____142547____663____75.5 (3.1)
    11/15/12____143172____625____74.1 (3.1)
     
  19. ckessel

    ckessel Active Member

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    I guess my only suggestion would be to consider in the risk level. If the car ends up being a lemon and Tesla goes bankrupt, you're stuck with a car with a likely low resale value and a very large auto loan. It might be advisable to wait a year or two to get a better idea of the car's longer term reliability as well as Tesla's longer term stability.

    For someone in your income and family situation, that's a somewhat significant risk. I'm not saying you shouldn't do it, but that it may be something to think about.
     
  20. Alexander

    Alexander P# 8,878

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    Thanks for the info. I didn't know that. Ill blow through that 50K miles real fast, but i guess we'll just see what happens. The battery is my biggest concern since my Insight has gone through 3 of them in the last 12 years.

    I thought that was optional? Do you have to get the checkup service? Does it include brakes? I calculated brakes into my math, but that was with me doing the work :)
     

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