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Resale Guarantee - does it require annual service?

Discussion in 'Model S: Ordering, Production, Delivery' started by pbleic, Apr 6, 2014.

  1. pbleic

    pbleic Member

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    Elon declared that annual service is no longer required, but the "Resale Guarantee" requires regularly scheduled service intervals, which according to the manual are annually.

    So, which is it? Do you have to bring the car in for service annually, or not?

    Paul
     
  2. Raffy.Roma

    Raffy.Roma Active Member

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    Hi Paul. I don't know what is this "Resale Guarantee". Can you explain it to me?

    Raffy
     
  3. rlang59

    rlang59 Member

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    "

    What is the Resale Value Guarantee?

    Tesla’s Resale Value Guarantee allows owners to sell their Model S back to Tesla between the end of months 36 and 39, regardless of the loan’s term. The resale amount is specified at the time of delivery and is forecasted to be higher than any high volume premium sedan brand (Audi, BMW, Mercedes, Jaguar or Lexus). This value is equal to 50% of the original base purchase price of the 60 kWh Model S plus 43% of the original purchase price for all of the options, including the upgrade to the 85 kWh battery pack (exclusive of taxes, fees, and accessories)."


    Frequently Asked Questions - Financing | Tesla Motors
     
  4. Raffy.Roma

    Raffy.Roma Active Member

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    Cool! After three years it's the right period to trade-in your Model S for a more updated Model S. :cool:
     
  5. MassX1317

    MassX1317 Addicted to TMC

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    A $100k, 36 month old Tesla with 45k miles will have a guarantee resale of about $48k. At this rate it would be worth $30-34k at 48 months and 60k miles.

    In comparison I just traded in my $29k, 48 month old Toyota Highlander with 80k miles and I got $19k.

    It seems like the bar is set pretty low with the trade in guarantee. There are a couple of additional costs as well:

    Service plan is for 4 years. As a result most will just pay for the $600 annual service, results in an additional cost of about $375.

    An additional 1% on an $80k loan will cost an additional $2-2.5k or so after 3 years.

    I'm pretty confident my Tesla will still be worth more than $29-32k after 4 years, so I am financing elsewhere.

    Tesla it's trying to avoid the haggling you see at a traditional dealership, which is nice, but I don't think Tesla is going to have used car lots, so the trade ins will probably end up with AutoNation or something similar. This will lead to a price structure for trades below what the car is worth at auction.
     
  6. MiddKid

    MiddKid Member

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    I view it slightly differently (as someone who just Financed through Tesla just to get the guarantee). In my mind you can't compare it to a Toyota resale as with that you are getting a known commodity. With a Tesla, anything but.

    First there are the technology questions...of which there are tons. What if 3 years from now EV tech has exploded and the original Model Ss don't age well? There is a jump in battery tech giving even mid-priced EVs 400miles of range. Who knows. This is market segment is filled with so many unknows. Competition is good! But accelerated competition 3 years from now could make our MSs look like the beta model.

    Then there are public perception questions with all this unknown tech. We saw it (and I still hear the jokes) about the fires. My Dad had an Audi 5000 back in the day of the "unintended acceleration" recalls...we watched his resale value plummet despite it arguably being WAY overblown in the media.

    The loan rate difference for me was 0.3%...and for me that difference was worth the piece of mind that I had an "out" after 3 years if needed. I don't like uncertainty...and this insurance made the $100k investment a bit more digestible.

    Now that we've hijacked the thread...sorry...I'm not sure on the original question! I have the resale guarantee and I have the service plan. Never asked if it was required...
     
  7. apvbguy

    apvbguy Banned

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    a very large part of the equation was omitted, in order to qualify for the buy back from tesla you need to have financed at least 70% of the cost of the car through tesla/their bankers

    - - - Updated - - -

    the only fly in the ointment is how far the technology advances in 3 years, if could render today's MS as obsolete. who uses an original Iphone these days?
     
  8. Alysashley79

    Alysashley79 Member

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    Beings that you had to pay for the annual service plan with the car to get the buy back guaranty yes you do. You don't have to take the car in at exactly 12,500 miles to get the guaranty but you do have to at least once a year and since you've already paid for it upfront for every 12,500 miles you might as well.

    As as for what tesla will do with their cars once they start getting them back. I don't think they will go to auto nation. I asked a tesla employee about it. They said that they will sell them similarly like they do trade in vehicles though it will be sold as is with no warranty etc.
     
  9. pbleic

    pbleic Member

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    Hard for me to believe. I am guessing they will do the same thing that other luxury cars do - spiff up the car, and sell it with a warranty. Just like they do with the Roadsters today.
     
  10. tliving

    tliving Member

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    Be careful on the resale guarantee that the values stated are for "normal mileage" of up to 15K miles per year. For me at a "normal" 35K miles per year that takes another $15K off the guarantee. I did some analysis here:

    Paying for the car | Tesla Living
     
  11. Newscutter

    Newscutter Member

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    I see that postulated a lot-- but at the same time, here's the proper counter-argument.

    If the car still does what you want it to do (which is what you bought it for in the first place)... Who cares? You only incur the depreciation if you SELL it.

    Keep it and use it in 2017 just like you use it now and enjoy your "classic" car! :cool:
     
  12. mkjayakumar

    mkjayakumar Active Member

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    The OP's comparison with Toyota Highlander is misleading. The comparison should be with similarly priced luxury models such as in the BMW, Mercedes and Audi lineup. At the end of the day your cost of ownership for 3 years 45k miles which includes maintenance and gas, is expected to be more for those gas cars compared to Model S - atleast that is Tesla's claim, and I think they maybe right.
     
  13. pbleic

    pbleic Member

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    The OP is me. I never mentioned a Toyota Highlander. This was another post within.
     
  14. apvbguy

    apvbguy Banned

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    that works well for some but a good many people do enjoy having the latest and greatest toys available. J/S
     
  15. MassX1317

    MassX1317 Addicted to TMC

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    I mentioned this, not the original poster.

    The point was a $100k Tesla and a $29k Highlander, should not be worth the close to the same after 80k miles.

    As for the original question by the OP, I have yet to get a straight answer on the service intervals, which is part of the original reason I diverted away from financing with Tesla. I didn't want to go with a higher rate and end up not following through on my end of the bargain.

    I hope to keep the care much longer than 36-39 months anyway, so its sort of a moot point.
     
  16. HHHH

    HHHH Member

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    I agree this is what they will do. Tesla has revolutionized each part of the process that was broken or could be enhanced thus far. I think they will recondition the cars, and offer them with additional warranties perhaps with HPWC's included or something for those that are interested in making the electric car switch that haven't done so yet. Also, I think the value of our Model S will continue to stay quite high if / until some new must-have feature is added. So far the car has been offered for roughly two years, but there hasn't been any must-haves IMO just minor incremental additions (think adding 3G to the original phone), without these major upgrades, there's really no reason for people to upgrade. As far as Tesla's cycle, what I see them doing is selling as many S's as possible, followed by X, followed by E, then once they've captured those markets fully then a major upgrade may take place.
     
  17. SOCALS

    SOCALS Member

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    Just a thought ... The Models S has been in production for almost 2 years already (1ST Deliveries sometime late Spring/early Summer 2012). Just like the iPhone, which was released in 2007, I do not see the Model S becoming obsolete. Yes the technology change but the basic shell mold or matrix is relatively similar tot he origin. The internal working of the item is much improved as technology progresses but again, the original shape is only updated and freshened as new molding technology improves. Having said this, how can the Model S go Obsolete when it is based on the ability to technically improve by applying TESLA updates. It is a car based on technology the can be updated with learning curves and based on real time data collection. The only part in the Models S susceptible to becoming Obsolete is the Battery Pack which has a limited life anyway. Batteries have come a long way but they do not radically change over a three year period to make the car Obsolete. In the end the shape of the Model S is dictated by the size of the battery it has to carry and that's why it is one of the longest widest sedans out there.

    The conclusion of my lecture, if the market trend continues over the next three years and knowing that the Model S and the new Model X for that matter will have a slow increase in interest (I am sure more electric and fuel cell cars will be introduced over the next three years, but the price of the TESLA will always be on the high end), in 3 years your Model S can be worth a high percentage of what you paid for it today. Cars delivered in 2012 (almost two years old) are being listed for near today's MSRP. Yes the Model S may change in three years and get other than technology improvements, but to me the C6 Corvette, introduced in 2005, still looks as nice as the 2014 C7 Stingray.

    In the end, the Model S is a high Value Car because the wear and tear mechanical parts in it are fairly inexpensive compared to the ICE car. The car improves as your ownership period increase via the TESLA upgrades (the only car that has this feature today). In three years I would think there will be available aftermarket drive motors (and other mechanical parts as well) for the Model S that will cost no more than a couple of thousand dollars and will be manufactured by any of the very reputable industrial motor manufacturers.

    Finance at the low rates, you will not need anybody's buy back guarantee as people will want your car (Had I found a two year old one with asking price of 10% less than what I ordered mine for, I would have grabbed it!)

    Ordered/Confirmed4/5/2014 - S85Grey/Grey Leather/Panoramic Roof/Supercharger/Dual Charger/Tech Package/ParkingSensors/ Fog Lights/Parcel Shelf
     

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