Tesla is the giant of the Electric Car industry. There is no doubt that Tesla promises a futuristic means of transport. But while being eco-friendly and energy conserving will Teslas save you money too? Is it worth buying a Tesla? Let’s discuss the liabilities and advantages of owning a Tesla in 2023
Will Teslas Save You Money? Advantages and Liabilities
The answer is complicated. And in reality, it depends on many factors and personal conditions.
A Tesla is definitely not the cheapest car in the market. It used to be a car for the financial elite because of its unaffordable prices. But that is not the case anymore since Tesla has now massively reduced their price tags. The Model Y now starts at $46,990 and with the EV tax credit, an EV can be bought for just $42,500. So these sudden price reductions have hanged perspectives towards Tesla and made it more affordable to the general public.
However, a Tesla is still a car out of reach to many people compared to a regular internal combustion car. Prices of a Tesla vary. Their Model 3 is the most affordable while the Model X is the top-of-the-line luxury smart car. The Tesla Model S can be cited as their flagship vehicle. Keep in mind that the initial cost of purchasing a Tesla will also come with taxes, titles, registration fees, and other expenses.
Most people are willing to pay extra for a Tesla with the hope that they will make up for the initial payment through the money saved on gas. This does seem pretty sensible. And if you are also being smart by producing less carbon dioxide and saving the planet, then why not?
But wait. It’s not as simple as that. Owning a Tesla does mean that you don’t have to spend thousands of dollars every year for gas. But it also comes with a multitude of other hidden costs that you never saw coming.
There will be the added cost of your electricity bill multiplying. You will have to spend a large sum for installing an EV charger in your garage. Expect to spend about $1200 for having it installed by a professional.
A Tesla Model S will have an electricity cost of $0.037 per mile if you charge it at home. Relying on supercharging stations for your charging needs will increase your energy costs significantly. A Tesla will cost you just $555 to drive 15,000 miles while an efficient gasoline powered will cost you $1589 for the same range.
And yes, an advantage in choosing a Tesla used to be the impressive tax credits of $7500. But not anymore. This was stopped for Tesla buyers in effect from January 2020. You still have the tax credits offered by the state and they differ according to the state in which you live. State tax credits could be as much as $2500 or significantly much less. So research your tax credit amount based on where you live and this might be a critical factor in whether a Tesla will save you money.
Another important factor to look at is the maintenance cost of your Tesla. And I’m sorry to disappoint you here too. Maintaining a Tesla is much different from maintaining an internal combustion car. A Tesla is a technologically advanced vehicle with many complicated parts and systems. A small damage to a Tesla will cost you thousands of dollars in repair costs. So the cost of maintaining a Tesla is very high.
Insurers are increasingly totaling Teslas even for minor damages due to the high costs of repair and maintenance. Most often than not, it is cheaper to salvage a Tesla (extract and sell usable parts) than to repair it. Read; Are Teslas easily totaled? for more information.
But on the bright side, owning a Tesla means that you don’t have to bring it in for constant oil changes and fuel filters. Tesla’s service needs are more software updates that occur automatically. You also don’t have to spend on emission tests.
But when complications arise in Tesla’s battery pack, you are stuck. Tesla batteries are irreparable. Having them replaced will cost you from $12,000 to $16,000. The Tesla battery warranty will only cover you for the first eight years or the first 150,000 miles. Tesla batteries are not long-lasting. It generally needs replacement after eight years.
In addition, since electric vehicle maintenance costs are high, insurance premiums for Teslas are high too. Some insurance companies also charge high insurance premiums because it is considered a luxury vehicle. But if you can insure your vehicle at Tesla Insurance (they have their own insurance company too) you may be able to get a lower insurance premium. However, Tesla insurance is only active in California for now.
The average cost to insure a Tesla Model S is $3673 per year which is significantly higher than an ICE car.
Will Teslas Save You Money? The Final Conclusion
There is no doubt that Tesla is making some awesome strides in the electric vehicle market. They might also have successfully created a means of transport that has a clean carbon footprint.
But as smart consumers, sustainability is not our only goal in mind. We want cars that are energy efficient and easy on the pocket.
In that sense, will Teslas save you money?
Although it seems like the electricity costs of charging a Tesla are much lower than constantly spending on gas, it comes with other unexpected costs for Tesla owners. These high costs include installing EV chargers in our homes, high insurance premiums, and high cost of maintenance.
So finally when you add up everything, the answer is no, Tesla will not save you money. In fact, owning a Tesla may be more of a liability and more expensive than owning an internal combustion car. But if sustainability and the prestige of owning a Tesla are of more importance to you than money, then please go ahead and indulge in a Tesla!
Also read: Are Tesla cars better than regular cars?
*All pics are courtesy of Unsplash.com