Supercharging Price - What if it is $2500?

[dgpcolorado]

I agree with the Options comment, almost. Up here in Canada where the temperature drops below -25'C (lowest i've seen in recent years is like -34'C or something) in cold Winters. So the SubZero Package is an absolute MUST-HAVE, kinda sad that Canadian's have to pay $1,300 CDN just to have an option to allow the car to function in our environment :X Wish I lived in California where its always a perfect 20'C.

Last I checked, the Sub Zero package was heated steering wheel, heated mirrors, heated wipers and heated rear seats. Of those, only the heated steering wheel is of interest (and I really miss having that) but it isn't worth $1000 to me. Do you really get much benefit from the other parts of the package? If carrying passengers in the back seat I suppose it would make sense to have heated rear seats. But heated mirrors and wipers really aren't something that I've ever needed in my climate, which is probably not as wet and icy as yours. Coldest it gets here is typically -20ºC or so, a few times a winter, but I once saw -30ºC. -10ºC to -15ºC is pretty common, but usually at night, with warmer daytime temperatures.

 

[S'toon]

Here is some antidotal evidence regarding the popular use of Superchargers ...

I stopped by Mt. View today and found they now have a concierge to help organize the queue ...12 SC stalls and 10 cars waiting mid day!

As you say, anecdotal evidence. That's the exception, not the rule. Heck, where I live there are no superchargers within driving distance of any Tesla on the market. That's my anecdotal evidence.

 

[eisbock]

It's not actually terribly obscene. At $300,000 per station they'd only need to be able to sell 35 Model 3s (at only the base price) at a 25% gross margins (or 19 Model S cars at $66k) to pay for a supercharging location.

Theoretically, if they used 100% of profits from sales for just a single quarter on supercharging stations then they'd be able to double the size network (without simply adding more superchargers to existing stations). Unless my math is totally off.

I mean, there's a whole lot more on top of the $300k installation. Rent, electricity, maintenance, ongoing R&D.

Also, for a car company whose primary source of revenue comes from selling cars, losing $20k per car is pretty obscene. I'm sure once the supercharger network is adequately expanded, they will undoubtedly turn a profit, but the additions of superchargers and stores and all that jazz require money, and that's something Tesla clearly needs right now.

 

[eisbock]

Actually, wrong. As I have no need for it, they are not building it for me, and I don't expect them to. It is nice of Tesla that they do it anyway. But mind you, they are not just doing it out of the good of their hearts. They do it because it gives them a massive advantage over the competition!

Um... okay? If you don't want to supercharge, nobody's forcing you to pay for the network. That's the beauty of offering it as an option. But clearly people value supercharging since you just told me it's a massive advantage, so people will pay for it and should be excited about paying more because it means a larger network.

 

[ecarfan]

The cost of building a supercharger network comparable to the current gas station network is huge. Gas stations have had a hundred years to expand, Tesla has a tenth of that.
.... Tesla is losing an obscene amount of money to make this supercharger network a reality for you and what, you all expect to be able to use it for only the cost of electricity?

Incorrect. The Tesla Supercharger network build costs are self-financing based on vehicle revenue. The ongoing cost of electricity at the Superchargers is literally a rounding error in Tesla's annual budget.

It costs $150,000 to $250,00 (in the US) to build a Supercharger location that can charge hundreds of cars a day. It's more expensive to build a new gas station.

In addition, the very existence of the rapidly expanding Supercharger network is a sales driver for Tesla as well as a marketing tool. ICE owners see a Supercharger and Teslas parked at it charging and it sparks interest. Plus it is a huge competitive advantage for Tesla since no other EV manufacturer has anything like it, and won't for years.

 

[JeffK]

Also, for a car company whose primary source of revenue comes from selling cars, losing $20k per car is pretty obscene. I'm sure once the supercharger network is adequately expanded, they will undoubtedly turn a profit, but the additions of superchargers and stores and all that jazz require money, and that's something Tesla clearly needs right now.

Remember they don't actually "lose $20k per car", they simply spend more than they are making into other investments. They are generating > 25% gross margins on the current vehicles. Their revenue is over 4 billion dollars, they report a loss due to spending and rightly so if the Model 3 sells as expected, it should more than make up previous losses.

 

[vinnie97]

I'm calling it, $1k for Model 3 lifetime supercharging.

 

[FlatSix911]

I'm calling it, $1k for Model 3 lifetime supercharging.

Close but ... the correct answer will be $2K for for Model 3 lifetime supercharging
Why would Tesla charge less than the current fee for legacy Model S 60kW owners?

 

[AustinPowers]

Um... okay? If you don't want to supercharge, nobody's forcing you to pay for the network. That's the beauty of offering it as an option.

I never contested that, did I? Actually I completely agree that offering it as an option on the Model 3 instead of factoring it into the price (which Tesla might do, at least partly, anyway, we will never know for sure) is the best way to go for their mass-market offering.
What we were discussing was the possible actual pricing of that option and whether that option would be worth it to us at said price.

But clearly people value supercharging since you just told me it's a massive advantage, so people will pay for it and should be excited about paying more because it means a larger network.

Not so sure about the "being excited about paying more", but other than that, yes, sure, a lot of people value supercharging, and rightly so. Just because people like me don't need it doesn't mean it is not a great offering.

 

[Shawn Snider]

Last I checked, the Sub Zero package was heated steering wheel, heated mirrors, heated wipers and heated rear seats. Of those, only the heated steering wheel is of interest (and I really miss having that) but it isn't worth $1000 to me. Do you really get much benefit from the other parts of the package? If carrying passengers in the back seat I suppose it would make sense to have heated rear seats. But heated mirrors and wipers really aren't something that I've ever needed in my climate, which is probably not as wet and icy as yours. Coldest it gets here is typically -20ºC or so, a few times a winter, but I once saw -30ºC. -10ºC to -15ºC is pretty common, but usually at night, with warmer daytime temperatures.

I say its required because the defrost vents in the dash aren't there if you don't get SZ package.

 

[No2DinosaurFuel]

That comes out to 1111 gallons of gas approx. or 50k miles.
I don't know about any of you but I won't be using it much.
Personally, I think 500.00 might be the correct amount. That's 10k miles of gas.
No, I don't think I'll ever get to charge up at sc stations for that number of miles in my life.
I have solar/wind and water power.
I probably won't be happy paying at the charger due to hacking.
I just might not get it at all.

Just my thoughts.

What about maintenance cost for you to use those stations when needed? What about the cost of the equipment? What about the construction and land cost? What about the fact that this is a free for life of the model s which can theoretically be really long in the future whether you are still using the car or not. Used model will still have free supercharging. So I think the $2500 is actually a discount for many.

 

[lklundin]

Poo-poo (ppu or pay-per-use) schemes are antithetical to Tesla's mission, and unnecessary about six different ways.

I think that in at least some jurisdictions, the direct association of a payment with a delivered amount of electricity (i.e. the per-per-use model) will be a serious mistake.

In the current model, you prepay for SC access i.e. the technical gadget in your car, the electricity _and_ the infrastructure.

If instead Tesla charges a price for a specific amount of electricity, they may very well be deemed an electricity supplier with each sale being subject to all kinds of taxes.

And since it has already been pointed out that in the current model the actual electricity cost to Tesla is a tiny fraction of the total cost, I would not be surprised if their future sales will have only unlimited(*) SC access prepaid, possibly as an option.

(*) Maybe this became 'unlimited long distance SC access' for some definition of 'long', per an Elon Musk statement.

 

[T3slaTulips]

Why would Tesla charge less than the current fee for legacy Model S 60kW owners?

1. Because they are selling to a different market.
2. Because a Model 3 is more efficient (requires less energy for the same amount of distance.)
3. Because Model 3 sales volume will be much higher than S/X.

 

[Winston Wolf]

Close but ... the correct answer will be $2K for for Model 3 lifetime supercharging
Why would Tesla charge less than the current fee for legacy Model S 60kW owners?

Because as with everything Model S/X...it's paying to make the Model 3 more affordable to the average consumer?

I too think that the introduction of the Model 3 will come with a lower SC cost, and when it does that will become the new cost for the S 60kwh owners as well.

 

[eisbock]

Remember they don't actually "lose $20k per car", they simply spend more than they are making into other investments. They are generating > 25% gross margins on the current vehicles. Their revenue is over 4 billion dollars, they report a loss due to spending and rightly so if the Model 3 sells as expected, it should more than make up previous losses.

Darn, I thought I had implied this when I said "I'm sure once the supercharger network is adequately expanded, they will undoubtedly turn a profit." Oh well.

 

[eisbock]

Incorrect. The Tesla Supercharger network build costs are self-financing based on vehicle revenue. The ongoing cost of electricity at the Superchargers is literally a rounding error in Tesla's annual budget.

It costs $150,000 to $250,00 (in the US) to build a Supercharger location that can charge hundreds of cars a day. It's more expensive to build a new gas station.

In addition, the very existence of the rapidly expanding Supercharger network is a sales driver for Tesla as well as a marketing tool. ICE owners see a Supercharger and Teslas parked at it charging and it sparks interest. Plus it is a huge competitive advantage for Tesla since no other EV manufacturer has anything like it, and won't for years.

Right, but we don't need to build any more gas stations. Sure, it costs loads of money to build a gas station, but that's a moot point. Those are also independent and turn profits, so there is incentive to build gas stations for the owners. Once a supercharger is built, there is zero tangible return.

The cost to build a hydrogen station is astronomical and that will certainly be a challenge for hydrogen car adoption. The one thing EVs have going for them is the cheap cost of charging stations, but they're still damn expensive. If they truly were self-financing, Tesla wouldn't be losing money right now. Tesla is hoping to stay in business long enough until the network is adequately built-out, but until then, they'll be losing money.

Sure, factories and stores and other expansions also cost money, but when you're dropping $200k per week on building new stations, it puts a damper on the ol' finances.

I understand that it's well worth it to have a supercharger network for the reasons you mentioned, but that doesn't stop the fact that it costs money, and that money comes from customers who pay more than the cost of electricity to enable supercharging, which is what this entire discussion has been about.

 

[MiamiNole]

Close but ... the correct answer will be $2K for for Model 3 lifetime supercharging
Why would Tesla charge less than the current fee for legacy Model S 60kW owners?

Economy of scale? As has been stated many times before in this thread, the primary cost of SC isn't necessarily the cost of electricity. It's building out the SC network. Given the considerably greater amount of Model 3's that will be on the road, Tesla probably won't necessarily need the same SC option price per car to continue to build out the SC network at the same rate. I'm looking up now as I type this and see that other responses have pretty much said the same thing. I would also think that Tesla would also want to reach a price point to maximize SC revenue from Model 3 sales. Regardless of how many Model 3s will use SCs and how much they will use them, Tesla will still need to build out the SC network.

Also, as someone else pointed out, as Model 3s hit the road, I can see the SC option cost for the few non-SC enabled S60s brought down to be equivalent to the Model 3 SC option cost.

 

[tsla007]

Tesla only needs 3500 more charging stations so that would be a max of 1b to finish that 300k each.
Now they will want another giga and manu plant (China for one and probably India ($7b))
I think Tesla should pause and make/pocket some cash. Don't forget to pay the shareholder who also made this possible. If Tesla can pull in 20b ish from mdl 3 sales and pocket about 7b and invest future cars/r&d 7b and payout 5b to shareholders-That would be ideal. 1b to sc network is petty cash for them. I think when mdl 3 is out in the public that sales will pickup again (after they pickup again after unveil 2) 750k by 2019 is not that far of a long shot (if all the parts are available). At this point profits should be around 38b or more. Thanks everyone for your comments. We all have opinions on this and it is nice to see people really thinking about it. Personally, I'd take a package of 20 yearly charges for 300.00 and that is being generous from me as I probably will only use about 10 super charges/yr. That's 15c/mi.
If this kind of thing isn't offered-I won't want SC at all.

Again, because I have free energy I won't want to buy sc for life-ever. 95% of CO2 from autos is from the commuter driver. Long distance-I'll take the Prius or Porsche.

 

[MassModel3]

If it will cost something around 2,500 to enable free supercharging for life (and this is made up by the OP, so it's a complete hypothetical), how does that compare to what you pay for gas?

According to AAA an average family spends close to $10,000/yr on gas. Edited to add: about $3,000/car/year according to AAA.

What am I missing here?

Something else you're missing is that you stated inaccurate information regarding AAA.

"Due to declines in gas prices and finance charges, the annual cost to own and operate a vehicle has fallen to $8,698..." "In the United States, a driver can expect to spend 58 cents for each mile driven, nearly $725 per month, to cover the fixed and variable costs associated with owning and operating a car in 2015."

http://newsroom.aaa.com/2015/04/annual-cost-operate-vehicle-falls-8698-finds-aaa-archive/

That's total cost for ownership, to include ownership, maintenance, and gasoline.

 

[FlatSix911]

Wishful thinking ... I hope you are correct, but it is all speculation until Tesla announces pricing next year.

1. Because they are selling to a different market.
2. Because a Model 3 is more efficient (requires less energy for the same amount of distance.)
3. Because Model 3 sales volume will be much higher than S/X.

Because as with everything Model S/X...it's paying to make the Model 3 more affordable to the average consumer? I too think that the introduction of the Model 3 will come with a lower SC cost, and when it does that will become the new cost for the S 60kwh owners as well.