Warranty/Servicing - official Tesla responses (incl GeorgeB)

[Jaff]

+ 1001 ...well stated Sir!

My God, is this really still going on? I for one would like to applaud George B's instincts on what whining deserves changes (the supercharger bit for those already locked in) and what doesn't.

I'll tell you what is "leaking into the automotive press": Model S spanking the M5 in a drag race.

Here's my advice. Stop comparing every little detail to its ICE counterpart. Tesla can't make Model S a better ICE than the ICE kings, and they can't make themselves a better traditional car company than the established players. The only way to win this is to play a different game. Sometimes that means no more haggling over price. Sometimes it means you have to wait for your car. Sometimes it means free fuel for your road trips and new features over the air, and sometimes it means no free service under warranty.

Every time I read "every other car manufacturer does x" I throw up a little in my mouth.

Step back and take another look at the big picture here. Go have a look at that thread with pics of everyone's kids in the driver seat of the Model S. Go watch some Tesla grin videos on YouTube. Pull out those pics you too at the factory tour last year. You know, that American factory that is now building American cars, guess what, it is still there.

Tesla has earned my trust. I wouldn't take my car anywhere else to be serviced, whether it is allowed or not. If they say it costs $600 a year, so be it. I probably spend a lot more than that on a lot of things that I care a whole lot less about (coffee for instance).

Different business models are, well, different. And I definitely want different.

 

[strider]

You can try and shout people down all you want but there are two things here that Tesla has to contend with and they're not going away no matter how loudly you sing kumbaya:

1) In order to succeed they need more than EV-fanatics to buy their cars. There aren't enough of us. They need people who truly are cross-shopping 5-series, A7, etc. and these people WILL compare TCO. And right now the TCO of a Model S is NOT lower than it's ICE competitors. Based on limited knowledge today about battery longevity, we must assume that fuel savings will be chewed up by an eventual battery replacement. Yes it has a ton of benefits over an ICE which is why I'm about to own two of them but buying a Tesla is not an economic decision.

2) Tesla states all over their marketing materials about how Model S is a "low maintenance car" yet has service fees that are the same or more than ICE cars. So they need to eliminate the marketing verbiage or bring service fees in line with that messaging.

I am FINE with paying to help build out the service network as an early adopter. But to do that they should add the cost to the car and keep the service fees low. It's related to the optics of #2 above. Whenever I talk to people about EVs I go into the amazing performance, etc but also about how much simpler an EV is than an ICE. So then people ask what the service costs. W/ the Roadster I could say that it's hand-built, 1st gen, lots of labor to check the Lotus chassis, etc. But now w/ Model S the price is the same and it really baffles people. Adding a couple thousand to Model S and Model X to catch the more wealthy early adopters to build out the service network and then w/ Gen III have reasonable service fees. I don't want Tesla to be known as an "expensive to own" car as it goes against what EV's are all about.

 

[Jhall118]

Either way, the Gen III will have lower service charges. Either because Tesla lowers them by then, or because 3rd party garages get the certification to service them. If a service tech no longer works for Tesla and works for some other shop that had the equipment, there's no way they could successfully pull the warranty card.

 

[Beavis]

You can try and shout people down all you want but there are two things here that Tesla has to contend with and they're not going away no matter how loudly you sing kumbaya:

1) In order to succeed they need more than EV-fanatics to buy their cars. There aren't enough of us. They need people who truly are cross-shopping 5-series, A7, etc. and these people WILL compare TCO. And right now the TCO of a Model S is NOT lower than it's ICE competitors. Based on limited knowledge today about battery longevity, we must assume that fuel savings will be chewed up by an eventual battery replacement. Yes it has a ton of benefits over an ICE which is why I'm about to own two of them but buying a Tesla is not an economic decision.

2) Tesla states all over their marketing materials about how Model S is a "low maintenance car" yet has service fees that are the same or more than ICE cars. So they need to eliminate the marketing verbiage or bring service fees in line with that messaging.

I am FINE with paying to help build out the service network as an early adopter. But to do that they should add the cost to the car and keep the service fees low. It's related to the optics of #2 above. Whenever I talk to people about EVs I go into the amazing performance, etc but also about how much simpler an EV is than an ICE. So then people ask what the service costs. W/ the Roadster I could say that it's hand-built, 1st gen, lots of labor to check the Lotus chassis, etc. But now w/ Model S the price is the same and it really baffles people. Adding a couple thousand to Model S and Model X to catch the more wealthy early adopters to build out the service network and then w/ Gen III have reasonable service fees. I don't want Tesla to be known as an "expensive to own" car as it goes against what EV's are all about.

Yes, we know already. Everything that can be said has been said. We are on page 49 so posting hasn't gotten the anti- service plan crowd any closer to their desired solution. It is time to stop posting about how this makes you feel and take action that might get you to where you want to be. Contact TM and tell them you are willing to walk away if they don't do what you want them to do.

 

[swegman]

I agree with item (1) of strider, above, and can give a perfect example. I have a friend looking at buying a new car, a loaded Audi A6 for a cost of about $65K plus. She looked at the Tesla at the scottsdale, az location. Upon hearing that there is a yearly maintennance fee for the Tesla, she said forget it. The Audi she is considering includes free service for the length of the warranty.

You can argue all you want that tesla is a startup, and needs the money to build service locations, Superchargers, etc. You can argue all you want that over a 10 year period, the tesla will be cheaper (and i debate this, as I know very few people that keep a car more than 6-7 years; actually, I only have 2 friends whose cars are older than 7 years). If tesla can not convince the non-EV fanatic to buy the car, it will all be for nothing. Tesla needs to convince the average person on the street that the car is worth buying. So far, EVERY person I know that is looking for a new luxury car has written off the Tesla solely because of the yearly maintennance plan requirement. Every sale they lose is one step closer to failure. They should have done what the other car manufacturers do; add it to the cost of the car and say yearly service is included for no additional fee.

 

[Beavis]

Ok, let me help you. My advice is to draft a letter to GB giving him your reasons that the service fee should be less, zero, or whatever. Let him know your demands. Go through every page of this 49 page thread and identify everyone that has voiced a negative opinion about the service plan. Send each one of them a private email through this site asking them if they will sign your draft letter to GB. Then send it with the signatures and reservation numbers. Be prepared to threaten to give up your reservation and sue for your deposit. If you aren't willing to do that then this is all just impotent whining because GB reads this never ending thread and there has been no action on their part to address your concerns.

 

[swegman]

Kroneal, I have already canceled one reservation and have deferred the second reservation to see what happens. I have discussed my concerns with them. To date, it has fallen on deaf ears at Tesla. All they say is they will consider the concerns raised by me (and others). They already lost one sale to me, and they may also lose a second sale to me. I want Tesla to succeed. I gave them deposits about 3 years ago. I believe in the potential of electric vehicles.

I am not suggesting that the service should be cost free. I am stating the cost should have been included in the cost of the car (yes, raise the cost of the car $2K for the purchase of the car), so it is not "visible", just like BMW, Caddy, Toyota, etc. have done, so that when the average person on the street looks at cars to purcahse, they don't go and say that the Caddy (or whatever) includes free service while Tesla is asking me to pay for service. It is the average person on the street that Tesla is ultimately going to need to convince to buy the car if Tesla is to be viable.

Also, don't forget that the majority of average people finance their car. Having the service cost built into the price of the car allows those people to finance the cost of the service. They will not be able to do that by purchasing the service plan 30 days after taking delivery of the car (not taking into account that the cost could be financed on a credit card, which probably has a higher interest rate than a car loan, and avoiding any discussion that if the purchaser can not afford the cost of the service plan, they should not have purchased the car in the first place).

 

[Beavis]

Again, we know all that. I am suggesting that one of you needs to lead an organized effort instead of posting continuously about this issue. One or two isolated cancellations isn't going to get it done. Grab the pitchforks and light the torches. Storm the castle.

 

[qwk]

I can't believe you guys are still debating this.

Just wait until Tesla runs through their deposit holders to finalize, when the list stops, asses are going to pucker. This won't take long since they are more than halfway through. Then what? They definitely underestimated their customer base. I bet most of their reservation holders are not your typical Benz or Beamer drivers like they had hoped.

 

[rcc]

I can't believe you guys are still arguing about this either.

I am a BMW owner. Believe me, the TCO on a Tesla is definitely lower than a BMW. Just an extra oil change a year (because I'm sorry but I'm going to change the oil more than once every 15K miles) costs >$100. I *know* that if I were paying BMW for service, I'd be paying lots more than $600 per year.

I'll agree that bundling the service price into the car is better from a marketing perspective but I'd bet large amounts of $$ that until very recently, they didn't know how much they were going to have to charge for service. They probably still don't know how much the service will truly cost them. I just hope they don't lose much money on it.

The stores are the key to pulling in reservations from BMW/Mercedes/Audi owners. That and great press from the automobile mags. They're getting more stores and great press. I think they're going to be ok as long as they don't get hit by some major disaster.

 

[ElSupreme]

I was and still am fairly vocal that the maintenance cost of the Tesla is much higher than my expectations. I was told they were cheaper than an ICE, but they are not. But bitching and moaning this much about a thousand dollars (you should have been expecting some maintenance costs) over 50,000 miles or 4 years is crazy. Am I sore about it, yes. Is it really going to change my decision? No.

Is what they did outrageous? No. Is what they did unfair? Not really. Could they have gone about it a little better? Probably, but in hindsight you can go back and do just about anything better.

 

[efusco]

I was and still am fairly vocal that the maintenance cost of the Tesla is much higher than my expectations. I was told they were cheaper than an ICE, but they are not. But bitching and moaning this much about a thousand dollars (you should have been expecting some maintenance costs) over 50,000 miles or 4 years is crazy. Am I sore about it, yes. Is it really going to change my decision? No.

Is what they did outrageous? No. Is what they did unfair? Not really. Could they have gone about it a little better? Probably, but in hindsight you can go back and do just about anything better.

My feelings exactly. I might say what they did is a little unfair and unexpected. And I think going with a 1 year 15k mile would have made me feel a bit better as that's my annual mileage, and at 12k I'm looking at an extra fee every 4 years. But, so be it. I knew I was buying a high end luxury sedan and I knew there would be a cost to that. 6 months after getting the car I'll rarely speak of it except when questioned why maintenance isn't cheaper by outsiders.

 

[swegman]

I'm sorry, but I don't think you understand that what I am saying is that tesla shot themselves in the foot. I'm not bitching about having to pay $2K for the service. I'm complaining about the way they did it. I can afford the service cost without any problems. I am fortunate enough to be able to pay for the cars in cash, no loan needed. In fact, I could buy several times that without needing a loan. The point is the average person can not. We are early adopters and many are willing to put up/accept anything Tesla does/says. But that will not fly with the average person who doesn't care if the car is an ICE or an EV and has to take a loan to pay for it. Those people are going to write off tesla because of the need to pay for service. The majority of the population could care less if they buy an electric vehicle or a gas vehicle. They are concerned with whether they will have to pay for service, and when confronted with other manufacturer's cars that offer "free" (included) service, they are voting with their pocketbooks and buying the other cars. I have personally witnessed that. As I indicated above, a friend in AZ looked at tesla just this week and decided to get the Audi because the car includes the service. I have other friends that I suggested the car to that said no because of the service cost fee during the warranty period. This hurts tesla and reduces the chance of them being viable. I want to see tesla succeed, but I am concerned that they are not making wise decisions. I think they may have miscalculated who the average buyer is. The average buyer does not want to pay for service when they can buy a competing car in which service is "included".

Please note that I have no financial interest in tesla, no stock, no intent to buy stock. I am only interested in seeing tesla be viable to produce the best car they are capable of, as it will spur other car makers to innovate, and that benefits everyone.

 

[Chas F]

I'm sorry, but I don't think you understand that what I am saying is that tesla shot themselves in the foot. I'm not bitching about having to pay $2K for the service. I'm complaining about the way they did it. I can afford the service cost without any problems. I am fortunate enough to be able to pay for the cars in cash, no loan needed. In fact, I could buy several times that without needing a loan. The point is the average person can not. We are early adopters and many are willing to put up/accept anything Tesla does/says. But that will not fly with the average person who doesn't care if the car is an ICE or an EV and has to take a loan to pay for it. Those people are going to write off tesla because of the need to pay for service. The majority of the population could care less if they buy an electric vehicle or a gas vehicle. They are concerned with whether they will have to pay for service, and when confronted with other manufacturer's cars that offer "free" (included) service, they are voting with their pocketbooks and buying the other cars. I have personally witnessed that. As I indicated above, a friend in AZ looked at tesla just this week and decided to get the Audi because the car includes the service. I have other friends that I suggested the car to that said no because of the service cost fee during the warranty period. This hurts tesla and reduces the chance of them being viable. I want to see tesla succeed, but I am concerned that they are not making wise decisions. I think they may have miscalculated who the average buyer is. The average buyer does not want to pay for service when they can buy a competing car in which service is "included".

Please note that I have no financial interest in tesla, no stock, no intent to buy stock. I am only interested in seeing tesla be viable to produce the best car they are capable of, as it will spur other car makers to innovate, and that benefits everyone.

Your point is well taken.

I will say though that I don't think this will impact the viability of the company as most people buying this class car will grumble but pony up regardless. Those that don't care whether its an EV or an ICE will probably not buy the Model S anyway because of the comparative costs. My guess is that if the service was suddenly changed to be included and you pressed your friend for a decision longer than 10 seconds, she still would not have purchased the S. Lastly, remember that this is a stepping stone in a much larger plan. Gen III will most certainly not have this high service cost and will sell in much higher volumes than the Model S.

Having said that, it still pisses me off to pay $600 a year for inspection, wiper blades, and brake pads (not even). I am still getting the car and will minimize the pain with the prepaid option.

 

[swegman]

Chas, we could go on and on forever on this subject, so this will be my last post on this matter. If what you say is true ("Those that don't care whether its an EV or an ICE will probably not buy the Model S anyway because of the comparative costs"), Tesla is in deep trouble. Elon promoted the car as being the best automobile, not the best EV, and there are only a limited number of people that want the car because it is an EV. The majority of the buying public couldn't care less whether it is an EV or an ICE. They are looking for a car that meets their needs. And to most of them, that includes service for no charge duing the warranty period.

As for my friend, I asked her and she said if service had been included, she definitely would have ordered the Model S. Since it is not, she is buying a loaded A6 tonite at the North Scottsdale Audi dealer for a little over $70K.

I also noted above that several other people I know decided against the Model S because of the service cost issue. It is hard to argue with someone about this issue when they point out that their BMW M5, Caddy XTS, Audi, etc. (and even low cost Toyota) includes service.

We are all intelligent people and know that when all the costs are added (price of car with included service vs. price of car and seperate maintennance fee), they are equal. But people have become accustomed to included service during the warranty period on upscale cars (and even every day cars like Toyota). What i am saying is that Tesla should have raised the MSRP of the car to include the maintennance service fee. Then, the average person on the street would feel the Tesla is comparable to other cars.

 

[ElSupreme]

Chas, we could go on and on forever on this subject, so this will be my last post on this matter. If what you say is true ("Those that don't care whether its an EV or an ICE will probably not buy the Model S anyway because of the comparative costs"), Tesla is in deep trouble. Elon promoted the car as being the best automobile, not the best EV, and there are only a limited number of people that want the car because it is an EV. The majority of the buying public couldn't care less whether it is an EV or an ICE. They are looking for a car that meets their needs. And to most of them, that includes service for no charge duing the warranty period.

As for my friend, I asked her and she said if service had been included, she definitely would have ordered the Model S. Since it is not, she is buying a loaded A6 tonite at the North Scottsdale Audi dealer for a little over $70K.

I also noted above that several other people I know decided against the Model S because of the service cost issue. It is hard to argue with someone about this issue when they point out that their BMW M5, Caddy XTS, Audi, etc. (and even low cost Toyota) includes service.

We are all intelligent people and know that when all the costs are added (price of car with included service vs. price of car and seperate maintennance fee), they are equal. But people have become accustomed to included service during the warranty period on upscale cars (and even every day cars like Toyota). What i am saying is that Tesla should have raised the MSRP of the car to include the maintennance service fee. Then, the average person on the street would feel the Tesla is comparable to other cars.

As a $1900 adder she could have had 50k miles worth of maintenance. Why does it have to be in the cost of the car.

 

[efusco]

As for my friend, I asked her and she said if service had been included, she definitely would have ordered the Model S. Since it is not, she is buying a loaded A6 tonite at the North Scottsdale Audi dealer for a little over $70K.

I also noted above that several other people I know decided against the Model S because of the service cost issue. It is hard to argue with someone about this issue when they point out that their BMW M5, Caddy XTS, Audi, etc. (and even low cost Toyota) includes service.

We are all intelligent people and know that when all the costs are added (price of car with included service vs. price of car and seperate maintennance fee), they are equal. But people have become accustomed to included service during the warranty period on upscale cars (and even every day cars like Toyota). What i am saying is that Tesla should have raised the MSRP of the car to include the maintennance service fee. Then, the average person on the street would feel the Tesla is comparable to other cars.

I argue that if you can't see that the TCO (Total Cost of Ownership) is dramatically lower for the Tesla than an Audi A6, then the presumption of "intelligent" is questionable. We're really talking about a tiny fraction of cost...she'll spend that $1900 in the first 6 months on the Audi in gas and maintenance.

 

[swegman]

Elsupreme and Evan,

I asked her and she is not paying anything extra for the service. She said service is being included with the car she is getting for the length of the warranty. Whether the Tesla will have a TCO lower than the Audi or another car depends on how long you keep a car. Since she (like I) usually get rid of a car before the warranty expires, the TCO for a model S may not (or may) be lower. I don't know.

In the last 15 or so years, I have kept only 1 car beyond the warranty period; that being a Prius, for which I spend less than $100/year in service costs, not counting the price for new tires. I switch cars often. My wife replaced one Lexus after 11 months, an Infinity after 3 years, and is looking at replacing her current 2.5 year old Lexus . She does this because she likes to drive new cars. I have replaced my Audis and MB just before the warranty expires because I don't want to deal with potential headaches after the warranty expires. The Prius is the only car in the last 15 or so years for which we paid for scheduled maintennance. How long you keep a car has an effect on the TCO. You are probably correct that the Tesla has a lower TCO if you keep it for 10 years if we assume the maintennance fee for years 5-10 remains $600/year. If you replace cars every 3 to 4 years, it may not be true, depending on how much you drive. Personally, I will probably put about 6k to 7K on the model S each year. So, over a 4 year period that would be 24,000 to 28,000 miles. The difference in price between gas and electricity may not offset the maintennance fee cost. I personally have never bought a car based on its gas mileage, but rather on the fact that i liked the car as a whole. With respect to the Prius, I was attracted to it not because of the gas mileage, but because I would only have to fill up every 3-4 weeks.

 

[dsm363]

For a 25 mpg car with gas at $4.50/gallon you're looking at $4,500 in fuel over those 4 years or $2,250 for a 50mpg car if I did the math right (for 25,000 miles). You'll spend $1000 dollars over 4 years for the Model S assuming 4 cents per mile of electricity.

If the psychological effect of paying for the service plan really freaks people out and causes them to not buy the Model S then they should build part or all of the cost into the car by raising the base price. It seems that the service plan could totally or mostly be evened out by fuel savings for most people.

 

[ElSupreme]

I asked her and she is not paying anything extra for the service. She said service is being included with the car she is getting for the length of the warranty.

This is irrational behavior. And in my experience trying to cater to this ends up being harder than it is worth. With the one exception of trying to take advantage of such irrational behavior.