Ok, so perhaps this is not a completely definitive answer, but if we make certain assumptions, we should at least be able to determine whether the prepaid $1900/$3800 plans make sense versus $600/yr pay as you go.
The assumptions we're going to make up front are:
1. There is no qualitative difference between the service you get pre-paid vs. pay as you go.
2. Pricing does not change in the future and discounted 4 year "add-on" service plans do not become available.
3. You don't get "credit" from a buyer for a pre-paid service plan if you sell the car before 8 years.
4. You have a fairly good sense of your potential investment return on money earmarked for future service.
5. You have a fairly good idea how long you plan to keep your Model S before selling/trading in.
I know that's a lot to assume, but if you can make these assumptions, you can figure out your likely best choice. Simply follow this ruleset based on the spreadsheet below...
Rule #1: If you plan to take the car in for service less than once a year, you're best off paying as you go ($600/service).
Rule #2: If you plan to keep your car for 3 years or less, you're best off paying as you go.
Rule #3: If you can sustain an investment return of over 10.05% percent, you're best off paying as you go, regardless of how long you own the car.
Rule #4: If you plan to keep the car for 4-7 years, you're best off prepaying for 4 years, unless rule #3 applies.
Rule #5: If you plan to keep the car for 8 years or longer, you should prepay for 8 years if you can not sustain an investment return greater than 3.67%, while you should prepay for 4 years if you can sustain an investment return between 3.67% and 10.05%.
With that said, I believe I fit somewhere in the rule #4 and #5 camps, so I'll be prepaying for the 4 year service plan.
Scenario tables:
The assumptions we're going to make up front are:
1. There is no qualitative difference between the service you get pre-paid vs. pay as you go.
2. Pricing does not change in the future and discounted 4 year "add-on" service plans do not become available.
3. You don't get "credit" from a buyer for a pre-paid service plan if you sell the car before 8 years.
4. You have a fairly good sense of your potential investment return on money earmarked for future service.
5. You have a fairly good idea how long you plan to keep your Model S before selling/trading in.
I know that's a lot to assume, but if you can make these assumptions, you can figure out your likely best choice. Simply follow this ruleset based on the spreadsheet below...
Rule #1: If you plan to take the car in for service less than once a year, you're best off paying as you go ($600/service).
Rule #2: If you plan to keep your car for 3 years or less, you're best off paying as you go.
Rule #3: If you can sustain an investment return of over 10.05% percent, you're best off paying as you go, regardless of how long you own the car.
Rule #4: If you plan to keep the car for 4-7 years, you're best off prepaying for 4 years, unless rule #3 applies.
Rule #5: If you plan to keep the car for 8 years or longer, you should prepay for 8 years if you can not sustain an investment return greater than 3.67%, while you should prepay for 4 years if you can sustain an investment return between 3.67% and 10.05%.
With that said, I believe I fit somewhere in the rule #4 and #5 camps, so I'll be prepaying for the 4 year service plan.
Scenario tables:
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