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My Take on George's Response to Maintenance - Yes, another post

This is my take on George response at http://tinyurl.com/8zf383e

First and foremost I appreciate GeorgeB adding color to maintenance/warranty blog, herewith some outtakes that I want to comment on.

So, to answer the question clearly about whether failure to do Annual or 12,500 mile Inspections voids your warranty, yes it does.
I think many of us can attest to fact to that OEMs rarely void warranties in practice if you don't service your vehicle with them. I've never had an issue, neither did anyone I know in my life where OEM made me pay for repair and yet I've never felt the need to pay more than 100 for a simple oil change or 300 for pads I do my own oil changes and brake jobs and I think many others choose avenues other than dealer/stealer.

Wiper blades, brake pads, brake fluid, and light bulbs are all included.
Let's face it, other than wiper blades, brake pads, brake fluid, and light bulbs what else is really going to fail on this EV. These are among best build cars in the world, quality is superb that's why we pay 50K-100K. Even then items referenced above will likely need to be replaced every second or 3rd year, which begs the question as to why 600/yr. The crux of the matter that TSLA is missing is that we had an expectation that maintenance will be lower than ICE vehicles not on par or higher, hence the disappointing responses. BMW - no maintenance for 4yrs, however I'm sure it's baked into MSRP anyway.

We provide 24/7 Roadside Assistance 50mi
Just about all of us already have this with your normal vehicle insurance or AAA at minimal cost.

I think my single biggest fear is that the 600/yr will remain in place for Gen3 vehicle and paying 600 annual maintenance on 30K EV to maintain your warranty just does not seem right to me.

Anyway, that's where I stand on this one, I'm sure many will disagree with me, but I'm still huge Tesla fan and share holder and Elon fan boy.

bsimoes,

There are a few things about alignment that I've found out over the years:

1. Most places never calibrate their equipment after the initial set up.

2. At many places the person who does the alignment is only senior to the person who changes the oil.

3. Many people who do the alignments can't name the five alignment angles, let alone tell you what each of them is supposed to accomplish.

4. Sometimes the person doing the alignment doesn't tighten up the suspension parts after adjusting.

5. Some shops are known to charge for the alignment but actually do no work. In some cases seals remained unbroken even though the printouts showed that they were changed. Note that this is usually more of a problem for trucks than it is for cars.

I can understand why Tesla has a lot of paranoia about alignments done elsewhere.

However, I think if they insist on doing the alignments and tire service, replacement tires should be included (at least for the 19" size).

I dont think the current maintenance agreement is a good approach. The standard warranty for the Model S is now $600.00 a year. This car can alert Tesla if any major problem is detected and these issues should be covered under the standard warranty. I understand that Tesla needs to generate revenue to offset their infrastructure, but this is not the way to do it. If yearly inspections are needed for early detection of design or material defects, they should be free of charge during the warranty period. A yearly fee would be warranted after the standard warranty expires. There are very few wear items on the S and the biggest being brakes should only cost $200.00 at the most every 2-3 years, probably less due to regen. The bug fixes should be unlimited and feature additions should be free for the warranty period, with reasonable cost thereafter. One of the biggest selling points of getting this car is to reduce total cost of ownership. The addition of yearly fees seems petty and unreasonable for such a ground-breaking vehicle.

I am a reservation/stock holder and truly believe his company is the key to so many problems. This issue has really left me disappointed and hope that Tesla will find another way around it. The other company Mr Blankenship referenced always made a point of admitting when it was wrong. I hope Tesla has the same ability for introspection.

Well, I guess that charging all model S owners the same 600 dollars per year is an attractive business model for TESLA. Owners must pay the $600 or void their warranty. Warranty services must be performed by TESLA. Pretty good deal for TESLA. For the owners? Not so much.
Owners are not all alike. Some cars will not need a single part; others will need major surgery. Some owners will be hard on brakes. Others will abuse the sound system. Some will be hard on interior controls. Some will drive in very dusty, dirty conditions. Some will keep their cars in a heated garage. Some, like me, work out of their homes and will likely drive less than 3,000 miles a year. Others will drive the maximum 12,500 miles allowed. In order to maintain my model S for 12,000 miles, TESLA plans to charge me an astounding two thousand four hundred dollars. Others will pay only six hundred dollars for the very same mileage.
In the end, one-size-fits-all doesn't really fit anyone very well.

While it was pretty clear that you have to have the Tesla service, and that it includes tire rotation and alignment, it wasn't clear to me that those two things were required to be done by Tesla. It seems reasonable that you could pay for the ranger service for everything else and go to a local shop for tire rotation and alignment. Of course, if the air suspension is a completely new, Tesla-engineered thing, that might not be the case.

If I understand George's explanation, software updates/new features will be included regardless of warranty. That leaves brakes, bulbs, alignments, and air suspension as the major items that need coverage. I think I can handle the brakes and bulbs myself. Wheel alignments won't be a yearly thing if at all. Even so, should be less than $200. What's left is the air suspension.

I've never owned a car with this type of active air suspension. Does anyone know how reliable these are? How much are they to repair when they break? If the answer is less than $2200 I am inclined to take a leap of faith and forego the service plan and take my chances with this car that has so few moving parts.

Also, since the first inspection is at 12,500 miles does that mean we have the first year to decide if we want to pay for the service plan? I may be dreaming about that one, but it would allow time to evaluate the reliability of the other 20,000 cars delivered.

Thanks Volker

ChasF: at the bottom of the Our Service Approach page (http://teslamotors.com/service), they state "four year plans must be purchased within 30 days of your Tesla delivery…"

Just to throw in one more (mostly similar) opinion on this. I think the best word I would use to describe the fee is disappointment. All the talk of no belts or oil to change built an incorrect expectation in my mind of the cost of maintaining the car. I will likely still buy the support plan as I want to support Tesla and see them succeed, I was just bummed to see the way this plan was announced.

+1 @Sorch. I'll bite my tongue and probably pre-pay 4 years but I remain convinced that Tesla is making a stupid short-term revenue decision at the cost of losing customer good will and muddying the "EV has lower cost of ownership" argument we all used to help justify buying our cars!

Maybe (just maybe) Tesla will listen and rescind this policy.

cadethoerk I could not agree with you more. I have a Lexus Hybrid and have not spent any money at the dealer. I service my car as stated in the manual and have had it back to the dealer twice for warranty repairs. They have never given me any problem why I don't bring the vehicle back to them for service. Tesla had to know they were going to charge this feed to keep your warranty well before taking non refundable deposits. This should have been disclosed right from the begining. I for one am not going to pay 600.00 for maintenance, what maintenance is being done?Give me a detailed list and let me decide if I want the services. If they want to inspect my car once a year then I will present the car to them. The only cost to me should be my time. Again give me a list of what I will get for my 600.00 and let's keep the wiper blades and brakes out of it. Nice marketing idea but anyone with a pea for a brain can figure how many times these items will need replacing. As for alignment, I have just about 40k on my Lexus and just replaced tires and had an alignment. The cost of the alignment was 125.00 not bad considering the age of the car and the miles. Now back to the maintenance fee in order to keep my warranty. Not going to happen! Sorry I can't allow myself to be taken advantage of. I have been disappointed in some of the moves made by Tesla and I have taken a breath and made an attempt to understand their reasons. However this is unacceptable at least for me. I will not be backhanded by this move. I want this car as much as anyone and have been waiting for it like everyone else. Unfortunately after I have signed on the line Tesla pulls this. I have no choice but to attempt to get them to return my deposit and cancel my order. I am looking at the Cadillac ELR as a possible alternate. Not a Tesla but I will have to settle for it. It is just the principal! Can I afford the 600.00 absolutely but I don't like being told I have to participate in something or else. Thanks anyway but NOT HAPPENING.

stephen.kamichi... Good to know TSLA ranger are willing to meet some folks half way that live several hundred miles from the service center.

Not sure how many Model S buyers are also investors, would enjoy seeing ratio on the first 5,000 owners but I am an investor and follow financials quite closely. Tesla is set to turn profitable in 2013 and make 25% Gross Profit. 25% in this industry in absolutely unheard of... infact most American automakers had losses and now are back in single digits GP margins.

I think you know where I'm going with this... If indeed they will make 25% GP you would think they could sacrifice a couple GP points and give us break on $600 maintenance fee by cutting down to $300/yr.

Anyway, that is the real issue here is how TSLA balances their future 2013 and 2014 profits with their pricing and keeping everyone including their own employees all whom get stock options happy.

I am also a share holder (even if it's just 100 shares). :D

I think we are comparing Tesla Motor's too much to all the "other" car manufacturer's out there. I think Tesla is excited about the offering for a reason, they see more value in it then we do. I am stretching my budget to buy this car, on the same note, I also want to feel that I am covered if anything happens to my "investment" in the Model S. That to me is worth $600 a year (although I will go for the 4 year buy-in to save some more.

Can we all reserve judgement until we have at least taken it in once? Experienced the service, just 1 time? So signup for it for one year, $600 is not a lot when you are already forking down $57k or more and you will get the $7,500 back when you do your taxes the following year that you get your Model S (hopefully). Use some of that rebate, if you find the service useless to you, don't buy it.

Let's not lynch the company before they have had a chance to plead their case. This isn't the Middle East... ;)

Wanna hear something funny?

Maintenance costs are 4.8 cents per mile. ($600/12,500 miles)

Electricity will cost around 4 cents per mile. (100MPGe)

We will be paying more for maintenance than the cost to move the car.

My electricity cost is $3.90/200 miles (includes 22%losses during charge, EPA 195 miles/60kWh battery; I get off-peak charging at 5.5 cents/kWk), which is EXACTLY 2 cents per mile. So with the Maintenance cost of 4.8 cents a mile I just increased my cost/mile to 6.8 cents, or an almost 300% increase in the cost of driving. Good thing it's an 8-10:1 ratio for cost of gas:electric fuel. It is disappointing, but not dismaying. This is the car of our lives. Shall be enjoyed immensely, and I'll pay up on my $1900/50,000 miles and not worry a bit about the car. OK, maybe a bit. Ideally, Tesla could have avoided this and included this cost in the price of the car as do Lexus and Mercedes and BMW. But they are dinosaurs now.

@ kevin
With charging losses taken into account you get about 89 MPGe. Including maintenance, it is barely above 40 MPGe :) - my Prius does a little better (but here gas is $8-$9 / gallon).

I've had two Mercs, and maintenance was never included in the cost.

I just looked at my Toyota expenses not counting tires or gas:

Purchased Jan 2006, first year of Highlander Hybrid
I did not start using software to track expenses before 2009

2009 $258
2010 $150
2011 $900
2012 $40

About 140,000 miles on it now. I think 2011 was worst year due to sparks, trans fluid, etc.
Perhaps a few dollars missing for cabin air filters, etc.

Those that posted your price per mile and adjusted MPGe,
Please also include the maintenance cost for your ICE in the calculations with MPG so we can compare apples to apples.

ROADSTER owners:

I know many Roadster owners think the service was worth it. The real question is...

When you took your ride to the service center did they need to replace and repair stuff, in your opinion, that might have voided your warranty if you didn't do the service and waited an extra 6 to 8 months?

Did you already know the work/service was needed from reading the forums anyway?

Do you think that if an owner took their Model S in 2 or 3 month LATE to the required service would Tesla void the warranty? (if something was wrong) or would the service center look the other way and repair it?
(Everyone else remember if the Roadster owners do comment, it is just their opinion and you have to way risks for yourself if you decide to extend checkups beyond recommend times to technically lower service costs.)

Do you think the free parts bit is really a factor in the service plan?
Software update?
Free upgrade?

What happen if the law where i live (quebec canada) protect consumer against this kind of abuse. -> failure to do Annual or 12,500 mile Inspections by tesla voids your warranty, yes it does.

@BYT, we have 4 more TSLA shares than you do :)

And we too are stretching our budget to get the Model S. Initially, I was thinking of getting a CT200h, which itself is the most luxurious car for us.

~ Prash.

How about: First year Free checkup. 2nd yr $200 3rd year $300 4th year $400 etc. As car gets older, cost goes up, makes sense.
Telsa wants to keep ALL S Models operating at the highest level and keep it's owners very happy so they will sell their friends on buying one also. If $600yr cost is too high, then some may not buy S Model or downgrade to a smaller battery as stated.

Worst of all, if owner doesn't get the regular yearly maintenance, at some point down road there could be problems (unlikely since I think it is a quality vehicle) that could have been prevented and warranty is voided which upsets the owner. This in turn casts doubt on the claimed little maintenance required touted and may infringe on the strong reputation that Telsa has rightly built to this point.

The above maintenance pricing would help ensure most of the S Models coming back each year for service and help avoid any road side preventable breakdowns which would not be good for sales /marketing. We all look to see what car is broken down on the side of a road. I have never seen a Mercedes broken down and we all want the same dependability with Telsa which maintenance will help ensure. So change price structure to ensure regular maintenance.

As far as wheel alignment and tire rotation goes, instead of being required to drive to a potential far off Telsa service center for some owners, Telsa could make an agreement with their Toyota partner to have them perform just these two maintenance items. This would ensure these are done right and official records maintained.

Warranty should NOT be voided if you are a few weeks late or few miles over the recommended amount. The battery should be unconditionally warranted for at least 4 years of the now 7yrs even if no Telsa maintenance is done by owner since this is the primary cost of the vehicle that owners are mostly relying on. My current car battery doesn't require me to take battery in each year to maintain its 4 year warranty. I realize Telsa battery is in a different league but all the more reason to stand behind it no matter what.
My 2 cents.

The battery warranty is seperate from the car warranty. Do they both require the yearly checkup?
It should say in writing in the warranties I would think.

I made this post over at TMC, but feel so strongly about it I thought I'd repost here:

At first, I was somewhat neutral about the service plan. Those on these forums make a good point about new technology, cheap plan to cover just about anything, blah, blah. I can also see the other side of the argument; bait and switch, "low maintenance" contradictions, etc. But now, the more I've thought about it, I think this is a bad move by Tesla.

The $ may not be a big deal for most of the "ballers" ponying up for the top of the line Model S (no offense to anyone here) during the first year, but eventually, those guys will have their cars and what Telsa will be left with is a good mix of MSP's and all those downstream of that trim level. Those in my financial strata that still choose to buy the car (I'm not even considering those that will/already have cancelled because of this) will do so by offsetting the service plan cost by removing options. Either way, Tesla will get their $2400 per car but in the latter scenario, they will be left with a few thousand stripped-down versions of the Model S on the road for all the world to see. This would have a significant impact on the Tesla brand, IMO. And trying to backtrack on requiring this service after that point would cause such an uproar I'm not sure they could recover from.

Tesla really needs to think this through....

kevin.hagenstad very interesting observation... paying less to move the Model S than to maintain it per mile.

Does anyone recall Musk stating that TSLA doesn't need additional capital to survive a few months ago... last couple interviews I have hear things like,

1. I think about holdings company for TSLA and SpaceX
2. We may need another round of equity/funding
3. Today on Bloomberg Elon was silent on 5,000 units by end of 2012

I'm just wondering if everything is still as cozy over TSLA as I thought, sounds more like next 6 months will be rough ride and then things will get better.

I mention that above because I think they might be strapped for cash and $2,400 maintenance fees will help them through it.

Good point ChasF: "Either way, Tesla will get their $2400 per car but in the latter scenario, they will be left with a few thousand stripped-down versions of the Model S on the road for all the world to see. This would have a significant impact on the Tesla brand, IMO"

Although Telsa may have identified this revenue stream to fund the new road rangers and new service centers, is the $600yr proposed maintenance fee or a graduated fee structure as car ages the best method?

It is indeed challenging to balance this maintenance pricing strategy (higher than cost to move S Model as stated) with adverse impacts it may cause to reservation holders or future buyers. ie downsizing options, buying smaller battery, not getting it serviced due to cost resulting in voiding the warranty impacting owner satisfaction.

With this in mind, Telsa price strategy should be set to maximize current / future sales while keeping customers happy, providing a solid warranty, while maintaining the quality low cost maintenance image of the first high mileage luxury electric vehicle. Overall satisfied customers will return for repeat business and word of mouth is best advertising.

I was adjusting to the idea of the $600 fee...even though I find it absurd...being such a maintenence-free car and all, but the part that I can't swallow is having to drive the car 600+ miles round trip 2X a year to get my snow tires put on and taken off. God forbid I get a flat. I have been told that whenever a tire is changed, the wheels should be aligned. George says very clearly that this (alignment and/or tire rotation) is something that the rangers cannot do. The car has to be brought to a Tesla service center. Does this not strike anyone else as an absurd requirement by Tesla...?

You can change your tires any where, any time you want. He said stop by and get the alignment when convenient... for the most part.
Do it yourself or take it to a tire shop and have them align them too. Then next time you are in the Tesla Service area stop in get your yearly inspection and be done with it.

That is just my opinion but I think what people are missing is the HUGE class action law suit coming. Tesla can NOT say that they are the only people that know how to align tires. If I was in the jury on that court case I would laugh my head off (then get yelled at by the judge) but I just don't think I could stop laughing. They will be in hot water. There are already trained wheel alignment people all over the country. There is a law in the US that says they can not require service through them for the warranty to remain and that they can require certified people to do the work. A certified tire alignment person is a certified tire alignment person.

Still my first paragraph stands. Have your local shop do it and then next time you are in the Tesla service center area get it aligned just like GB said.

Battery tech inspection. Tesla only.
Drive train. Tesla only.
Brakes, tires and stuff like that.... I can see and argument for Midas, etc.

That's just my opinion tho and I am going to buy the 4 year plan and take it to a service center they are supposed to be putting near/in St. Louis. Hopefully this is all a little clearer within the next year. Either way you must spend the money to get the drive train inspected to maintain the warranty on the drive train. No way around it.

When I get new tires I REFUSE to take it to Tesla. period. I will get tires at a tire shop. They will align and balance them. Then the next time I am near the Tesla service center I will get them to check the work.

I sent an email to GB explaining what I think of the maintenance plan and why. I suggest that everyone on this thread email their comments and thoughts to GB.


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