Thoughts on Prepaid Service and Extended Warranty

[Sony SS-M7]

Also, does anyone actually see the option to purchase the pre-paid service plan on their My Tesla page? I don't see it on mine.

 

[Tam]

...option to purchase the pre-paid service plan on their My Tesla page...

It is clear that pricing for Service Plans and Extended Service Agreements has not been decided for Model X so you won't see an option to purchase them on your page until then.

Would you speculate that prices for Model X will be 1) equal, 2) less than or 3) more than current ones for Model S?

 

[elguapo]

Absolutely higher. X is more complex and if it was going to be equal, Tesla would have announced it already. TM can't figure out how high yet and probably doesn't want to add to the reliability debate by introducing a higher cost plan yet.

 

[harrisonjs]

Are there thoughts on how this analysis would change if you are leasing instead of buying?

 

[Sony SS-M7]

It is clear that pricing for Service Plans and Extended Service Agreements has not been decided for Model X so you won't see an option to purchase them on your page until then.

Would you speculate that prices for Model X will be 1) equal, 2) less than or 3) more than current ones for Model S?

Only thing is that you supposedly only have 60 days after delivery to buy the prepaid service plan - at least that's true for the S. So either they waive that 60 day requirement for the X or they set a price.

I'll just call Tesla today and clarify this.

I'm going to speculate that the prepaid service plan will be the same price or very close since it's just inspection, air filter, tire rotation for the cheaper service and brake fluid, AC, and battery coolant for the more expensive services. Unless they do more, they shouldn't charge more.

But if they judge the car to be less reliable or more complicated so more risky to cover fixes in years 5-8 for the ESA, then it will likely be higher. I'd guess that the ESA will indeed be higher for these reasons.

 

[idoco]

When I originally bought my MS it was implied that annual service was a requirement for the warranty to be in effect. Combined with the discount on pre-paying the annual service it made sense to buy the ESA.

Since then the requirement of having annual service for warranty work has been dropped. The only benefit of the ESA at this point is the slight savings by pre-paying.

Now with ~50K miles on my MS my last pre-paid service will be used. I don't plan on buying four more years of pre-paid service. I will just bring in the vehicle every 12-15K miles for service and pay the going service rate. Same for MX. Plan on just paying for yearly service (non-warranty service) without an ESA.

The extended warranty is a separate issue. As others have mentioned it's an insurance policy on the "stuff" not part of the drive train and battery warranty. Given we still don't have sufficient long term data for the MS I plan on purchasing the extended warranty for years 5-8. Don't have to decide on the extended warranty for the MX for four more years.

 

[HankLloydRight]

Since then the requirement of having annual service for warranty work has been dropped. The only benefit of the ESA at this point is the slight savings by pre-paying.

Now with ~50K miles on my MS my last pre-paid service will be used. I don't plan on buying four more years of pre-paid service. I will just bring in the vehicle every 12-15K miles for service and pay the going service rate. Same for MX. Plan on just paying for yearly service (non-warranty service) without an ESA.

The extended warranty is a separate issue.

Just to clarify terminology. The 4 or 8 year pre-paid service plan is called the "Pre-Paid Service Plan", not "ESA".

The Extended Service Agreement (ESA) is what is normally called the "extended warranty", but isn't due to legal reasons in most states.

 

[Sony SS-M7]

Assuming the 8yr prepaid is $4000 like the S, $500 per year seems very reasonable to me. For me, I'd rather mitigate the risk of service pricing going way up over time - you never know when making the SC a profit center (like most auto manufacturers) will become a necessity, especially if the company continues to lose money.

Sure, there's not as much to do, but my Lexus 30K/60K/90K, etc were WAY more pricey than that and I'd personally rather lock in pricing now and not worry about it.

I'm likely to go for the ESA too because I'm somewhat risk-adverse by nature and as mentioned by others, the newer nature of the technology in the X makes it make more sense than for an ICE car.

So the ESA doesn't cover air suspension on the S?

 

[HankLloydRight]

So the ESA doesn't cover air suspension on the S?

I personally have not heard that the smart air suspension is not covered, and frankly, I'd be very surprised if it's not. I think people are just confusing the generic term "suspension alignment" or "shock absorbers" with "air suspension". Here's the relevant parts from the contract.

(Not covered) Maintenance/Parts, including but not limited to the following:
o Parts and normal or expendable maintenance items and procedures such as annual service and diagnostics checks, brake pads/linings, brake rotor, suspension alignment, wheel balancing, hoses, air conditioning lines, hoses or connections, Battery testing, fluid changes, appearance care (such as cleaning and polishing), filters and wiper blades/inserts; and
o Other maintenance services and parts described in Tesla’s maintenance schedule for the covered Vehicle;
• Other Parts not covered: o Bright metal, sheet metal, bumpers, ornamentation moldings, carpet, upholstery, paint, shock absorbers, 12V battery, battery cables, lenses, light bulbs, sealed beams, glass (e.g., windshield), wheels, interior trim, body seals and gaskets (e.g., weather stripping); and o Removable soft tops, removable hard tops, glass, plastic, framing, cables, or seals;]

 

[HankLloydRight]

Control arm bushings: ~$TBD

I include the last entry just as a reminder, as iirc, the ESA does not cover suspension parts.

Nowhere in the agreement do I see suspension parts, even bushings, excluded:

https://www.teslamotors.com/sites/d...ments/na_tesla_warranty_plan_agreement_ot.pdf (log in may be required)

 

[Sony SS-M7]

I called the Fremont SC and they confirmed that there's no prepaid option being offered yet. They said not to worry about the 60 day limit and there would likely be a notification for when the prepaid option was offered.

 

[Tam]

...leasing instead of buying?

Usually, a leasing term is already covered by basic warranty because it is less than 4 years and also less than 50,000 miles so there is no need to buy Extended Service Agreement.

However, I think leasing requires you to do annual maintenance so you need to budget for that.

 

[GottaGetRidOfICE]

I called the Fremont SC and they confirmed that there's no prepaid option being offered yet. They said not to worry about the 60 day limit and there would likely be a notification for when the prepaid option was offered.

Funny. I was told to speak with my local SC (Springfield, NJ), did so, and purchased a 4-year prepaid plan using a credit card.

 

[GottaGetRidOfICE]

 

[elguapo]

@Gotta Very interesting - so it's 5% more than the S, is that right? My S was $500/year for the annual maintenance plan when I bought it in 2013.

The difference here may be they can sell the prepaid maintenance because, as others noted, that's a fixed amount of coverage/work and they know the costs. There are people who have 12,000+ miles on their X, so TM has to figure that out ASAP.

We are far off from entering the fourth year of ownership for anyone. The part I am more concerned about is the extended warranty for years 4-8.

 

[GottaGetRidOfICE]

@elguapo, The SC rep broke it down by year, and while I don't remember the details, the 4 year plan was a lot more than the 3 year plan (ie, some substantial additional work is done in the 4th year).

I remain undecided about an extended warranty.

 

[TaoJones]

Nowhere in the agreement do I see suspension parts, even bushings, excluded:

https://www.teslamotors.com/sites/d...ments/na_tesla_warranty_plan_agreement_ot.pdf (log in may be required)

At first glance, that is a true statement, with the exception of shock absorbers (see page 4). To be fair, I wouldn't expect shock absorbers to be covered in any case.

Tangentially, although not a suspension item, note that rotors are explicitly not covered - and, according to my last service rep, they "replace a lot of them". Those are $1400 per full set, including labor. Fortunately they are covered for 1 year (parts and labor), so if you're on your 5th set in 36,000 miles, expect that you'll never pay for rotors for as long as you own the car or until they actually resolve the root cause. This seems to affect only AP owners and, presumably, not all of them.

My recollection is that suspension parts are not covered because they fall under the 'wear and tear' clause(s). In fact, this very excuse was given to the fellow whose upper control arm failed at 5mph on a dirt road due to rust (!?) at 72,000 miles. That was escalated, of course and is pending.

I will go over the ESA line by line before meeting with a service manager in the next 2 weeks and see if I can get direct answers, in writing, to direct questions. I expect I'll get referred to the regional manager for the in writing part, which is fine. One step at a time. I feel badly for the 2013 owners who have experienced so many challenges, and hope that as a late 2014 owner, I won't experience as many. One would think not.

Lastly, while it is disappointing that even the URL contains the word "warranty" for the ESA, the VERY GOOD news is that they've changed the verbiage to clearly state $200 per visit, instead of per issue. Many people have 5-6 non-critical issues per visit. This is now in line with how most extended agreements are worded. *Happy dance*. Just *that* change takes away a lot of the potential open-endedness of the agreement, and somewhat tips the scales in favor of buying - except for the 18 month part if you drive a lot.

 

[PDFS]

I am one of those suckers that buys an extended warranty on a car. I will also buy the service plan on this car so my wife is not saying $600 repair/inspection bill.
On my Ford Expedition I bought the extended service plan/warranty because there were so many electrical options, CD player for movies and screen and other options on the car. I currently have about 8K miles left on that plan. Last week the differential seals went out on front and back. The cost to repair was going to be about $1,400. The radio sterio system also went out on two other occasions and was replaced both times. The warranty picked it up. We have had similar experiences on other cars also. We seem to get our money's worth out of those plans. We do not buy third party plans only from auto company, FORD GM etc. I also do not buy travel insurance.

 

[Coolcarx]

View attachment 175221

So this is the prepaid service plan not the ESA The Extended Service Agreement (ESA) is what is normally called the "extended warranty" Do they have a price for the ESA?

 

[Sony SS-M7]

@Gotta Very interesting - so it's 5% more than the S, is that right? My S was $500/year for the annual maintenance plan when I bought it in 2013.

The difference here may be they can sell the prepaid maintenance because, as others noted, that's a fixed amount of coverage/work and they know the costs. There are people who have 12,000+ miles on their X, so TM has to figure that out ASAP.

We are far off from entering the fourth year of ownership for anyone. The part I am more concerned about is the extended warranty for years 4-8.

The current pricing on Tesla's website is $2100 for 4yrs and $4000 for 8yrs for the S, so the 8yr just saves you a bit more than double the cost of 4yrs.

Maybe if you push it they'll sell one to you for the X, or maybe it depends who you get on the phone?