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Extended service agreement price hike?

I could have sworn the price I saw last week was $2500 and when I just checked it, it was $4000? I just filled out my delivery survey. Could that have jacked the price or did I just have poor timing?

Update: This thread came to Elon's attention and Tesla Motors came through and gave us all a grace period to buy the ESA at the $2500 price.


You are referring to the service plans. We are all referring to the extended warranty which went from $2,500 to $4,000.

george210.... they r talking about extended warranty, not service plan....I know it's little bit confusing. They are taking about service for material defect, not regular service.

@George210 - Title says "EXTENDED SERVICE PLAN" and NOT "Pre-Paid Service Plans." SCROLL DOWN and you will see what the whole thread is about!

@Jusineet - Whether they mispriced it or not, is their issue. It's fine if they correct it, but w/ a little notice would be appreciated for the price hike with loyal owners and people who take a risk being an early adopter and support them.

Personally, they need to figure out how to lower their costs rather the easy way out and pass onto us. For one thing, if they improved the quality control coming out of the factory it would go a long way. There is no excuse for the alignment issues (toe out of wack) that several have had that caused premature tire wear. The pano roof creaks should have been caught before the car got to market.
My few cents.

I cannot conceive what kind of costly defect would manifest itself in years 4 to 8, in some regularity, which would cost this kind of money. I expect the car will remain defect free for a long time. My original plan is unchanged; wait until year 3 and evaluate the price of the extended warranty at-that-time as compared to my personal reliability experience and those of others. Then decide to turn in the car or keep for the long run, possibly with an extended warranty.
It's not like our land rover where we replaced the radiator every 18 months under warranty until the extended warranty ended. That was a good deal.

G. Blankenship also promised a lot of other things in previous blogs - Lighted Vanity Mirrors, Shade for Panoramic Roof etc. I guess a year later the engineers are still designing these things. Well if you believe that then you should not be surprised by his blog earlier about Extended Service Agreement. By the way I bought 4+4 Maintenance Plan and 4 year Extd. Service for a total of $6300 because I feared something like this would happen!

I was just thinking. My 2011 Jeep Grand Cherokee with air suspension, Hemi engine, costly transmission, etc., cost me less than $3000 for a lifetime, bumper to bumper warranty from Chrysler ($100 deductible I think). Why on Earth Tesla would charge $4000 for 4 years, when the battery is already covered and there are so few moving parts, is beyond comprehension....

This is so unlike Tesla! I hope they make it right for their hardcore customers whom supported this company and fought for Tesla when they where being attached by the Dealers Associations.

I'm so glad I got the three-year buyback option. My optimism for Tesla is fading due to how they've mistreated and cheated some customers on a variety of issues.

This is not how to build the best auto mfg company in the world. This is how to mimic companies that suck.

Tesla advertised that I could purchase the $2500 warranty, but never gave me the opportunity to purchase it at that price (not $4000 either). This is outrageous!

We've been cheated by a company who had our support and loyalty. Sad.

Wait... this is not cool. I'm taking delivery tomorrow, and was waiting to purchase the extended service agreement until I took delivery. If I had known this price increase was coming I wouldn't have waited... it just didn't make sense to buy a warranty for a car I didn't own yet.

A grace period would have been appropriate for current owners.
I'll be sending an email tomorrow.


I would not really compare Jeep Cherokee with Model S....very different class of cars. Would you compare BMW with Jeep Chrokee?? Another thing you probably know is the "bumper to bumper" warranty is only valid with the original becomes void if the car is sold to another person. Moreover, the lifttime warranty doesn't not cover cost due to normal wear and tear such as replacement of covers mainly breakdowns due part defects. BTW, do u know you sound like a GasHead some ICE dealer or something???


I think they should give to current MS owners and everyone who finalized purchase about a week or two opportuinity to buy the extended warranty for the original 2,500K price. But to give Tesla a little benefit of doubt, it was always stated on their site that the pricing for the extended warranty can change in the future. It's true they should have made that fact well known, but in fine print it was always the case..

Can you provide the link to the "fine print"?

I found the verbiage for the "pricing subject to change"; it applies to the Service Agreement. I don't see it for the Extended Warranty Plan.

@kawaiia....The first sentence under the "Service Plans" table was always clearly states the prices quoted may change in the future. If I remember correctly, similar wording is also there in the limited warranty contract.

The e-mail reply I received sez:

"Thank you for reaching out to Tesla.

The price of the Extended Service Agreement has been changed from $2500 to $4000 to better reflect the services provided by the agreement. Tesla’s extended service program covers the repair or replacement of Model S parts due to defects in materials or workmanship provided by Tesla. Coverage lasts for four years or 50,000 miles (whichever comes first) and begins on the date the warranty expires. The Extended Service agreement can be purchased within 30 days of the warranty’s expiration."

Most of it's fluff except the " better reflect the services provided by the agreement." I was a little annoyed at this reply, but reading the replies since my comment last night, I'm oddly less annoyed. Still annoyed. I put it off since it wasn't practical to buy the extended warranty, and honestly until the 4/50,000 is up, I'm not sure if I need it. Now I regret it, since the price jumped up so much!

I will say, though, that I'm a bit amused. They under-priced it? Well, maybe, but honestly everything they're having to fix now is under the original warranty! They won't truly know whether they under-priced it till they see what issues come up after 4/50,000 (whichever comes first, remember). Heh.

Anyway, I'm disappointed, given their previous heads-up before a price hike. But it seems clear they feel they messed up the initial price, and what was a feature (reading GB's original post about the extended warranty) is now viewed by Tesla as a bug.

Honestly, though--I'm still not sure, maybe we don't need it. I mean will we be finding defects in 4/50,000? A lot of tech tends to show its problems early on. I've never bought an extended warranty for anything, While I was figuring I'd probably get this one when the original warranty ran out, maybe when the time came I wouldn't have bothered.

Sorry to ramble, folks. Kinda thinking out loud here. ;-)

Another thing Tesla could do is offer extended warranty for shorter periods of time like Mercedes does for those who don't want 4 years Mercedes they can offer 1, 2 and 3 years extension in addition to the 4 years.

Deep breaths.....everyone should take some deep breaths. I hear some voices of calm & reason, but I hear lots more people freaking out!

Yes, it's disappointing, but let's give it some attention and see how things play out. Chances are high that Tesla will do the right thing. Worst case scenario may be that it costs more.

A show of hands....who's willing to give up their MS over this? Not me!
Who has spent more than $1500 already on coatings & waxes & finishes after delivery. Not to mention Tesla luggage, gear, center consoles etc. I've come close.

I'm reading some of your reactions & you'd think Teslas were blowing up or something catastrophic.

"What don't we know??? What aren't they telling us?? What's wrong with the car??"

Let's take this in perspective and not wig out.
That's my two cents.

I was leaning against buying the extended warranty but was planning to wait till near the end of year 4 to decide. This seals it. I will not buy the extended warranty at that price.

Quick poll: Will you buy the extended warranty at $4,000?

The thing is even those people who wouldn't have bought it at $2500 would buy it now given the chance. That's marketing.

I'm not really able to afford the extended warranty at either price, so now it just worries me that the company is projecting higher costs (more and/or more expensive failures) than anticipated past the initial warranty period. Since I took delivery in October I won't have much benefit of watching to see what others are experiencing in the way of post warranty failures. At this point, there is no car I'd rather have, but I'm hoping Gen III is available before my original warranty runs out so I can trade down and get a car I can more comfortably afford and will fit better in my city parking pad.

And again, at this point I just wish I had put the $40k deposit in stock instead. I could have bought a perf Model S and gotten my original $40k back. I need to go for a drive and get my mood back up. :-)

We should expect the prices of the annual inspection, service plans and extended warranty to change as Tesla gains more experience (the first production Model S is only a year old). Especially for the P85 and P85+ models, the costs (even with the extended warranty increase) still seem reasonable, for vehicles costing around $100K or more.

Locking in the current prices was one of the factors I considered when purchasing both the 4+4 service plan and extended warranty when they were first offered, because I expected those prices to go up (even if it was only an adjustment for inflation).

When compared to the projected maintenance costs of a comparably priced ICE over 8 years, there should still be considerable cost savings - plus the savings in convenience of annual versus quarterly service visits.

However, Tesla should have provided a warning to owners about the price increase and a limited period for purchasing the plan at the original price.

Yes, I believe when they say it was under priced. I don't have all of their facts to say otherwise.
We are planning to buy the extended warranty - we always do since we are high mileage users. (bmw's cost about $2400). But at delivery we were told there is no need to get it now, wait for when the current one is about to expire.
And yes, we knew price may go up. We can use that money elsewhere and purchase later.

BUT, give us notice, and a chance to purchase pre-increase price!!!

Bad form, Tesla.... Bad form.

What I find most puzzling about this is that no production Model S is more than one year old as of today. So the original 4 year warranty has not expired yet for anyone, theoretically. (Unless someone has more than 50,000 miles in the first year!) So how could they determine that the price was too low, if extended warranty has not yet been utilized?

Furthermore, the new price implies that extended warranty average utilization will come to somewhere around $1000 per year (if priced to not make profit, as Elon said.) That seems extraordinarily high, somehow. Which makes one think that Tesla is anticipating that some components WILL break down between 50,000 and 100,000 miles and need to be repaired or replaced. Which components would that be? Especially since the battery is under separate warranty.

Unfortunately, Tesla, this move is likely to undermine confidence in the long term reliability of the vehicle, and so will probably cost the company more over the long haul, since it gives potential new buyers more reason for "cold feet," and nay-sayers more ammo to imply that the car is not reliable long-term.

Also, the abrupt and arbitrary nature of this price hike just appearing on the website with no explanation, is damaging. And what is the payoff? TM is going to sell fewer extended warranties with the dramatic price hike, so revenues from this program will probably not increase, may even be reduced, along with customer confidence.

This move really makes no sense to me. Tesla, are you listening? Complaints about communication are frequent.... Please, get a grip on this and understand that customer communication and loyalty is the lifeblood of your company. You would have had better results and more revenue at this point if you were to REDUCE the price of extended warranty, at least until the hard data of utilization begins to come in, somewhere around 3 to 4 years from now!

If there's one thing TM should have learned by now, it's that TM customers don't like to be surprised, at least not negatively surprised. This happened when they added a $2,000 price to 60 kWh supercharging. It happened when they deleted the Alcantara headliner for the Performance. It happened when they deleted the fog lights. And it's happening now, with the price increase for the extended service agreement.

People like to have notice of these things. It can't cost them that much to give notice, after which they are perfectly within their rights to raise prices. Think of the cost of notice as advertising, as the purchase of good will. It takes a lot to build good will, but so little to destroy it.

Those of us in Washington and several other states never had the opportunity to purchase the extended warranty at $2,500. I would have done so at the same time I purchased the service plans. Count me disappointed.

I thought the Warranty was reasonable at $2500 and I think $4000 is reasonable. If the 17" display were to fail after the original warranty, what do you think the cost of replacing it would be?

Yep. But the thread title doesn't say that.

I think the point here is not whether the new price is reasonable or not, but that they changed it without notifying anybody, especially those who planned on staggering out their cash outlay over a period of time.

Secondly, by saying this reflects the true cost to Tesla, it implies that the product is not expected to cost $4000 due to failewd parts etc over 4 years which is probably not the right message to be sending the market.

To make this right Tesla should make an annoucement to give folks a 1-2 week grace period to purchase the warranty at the old price and then do the price increase.

Tesla, there is still opportunity to make this right...

@imherkimer.....I think you r missing what they are trying to's not necessary for them to wait for most of the original warranty to run out to have a feeling how much service would cost. They can have a good idea based on the services they have been giving for the past year. Your suggestion for them to wait until the original warranty runs out does not make sense if the pricing is indeed seriously flawed. Your suggestion will allow lots of buyers to lock in extended warranties at too low of price which is what Tesla is trying to avoid.

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