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Help me understand why to buy the Extended Service Plan...even at a discount

I know there has been a lot of discussion regarding the ESP lately especially due to the impending price hike...but I am having a hard time seeing the value. Maybe someone can help me see what I am missing. The service plan agreement excludes a lot of items--the battery, the brakes, etc. (I almost wonder if it would have been easier for Tesla to list what the plan DOES cover). I suppose the biggest fear I have would be if the touchscreen or dash display were to fail. However, wouldn't standard car insurance cover this? What would be the point of the ESP? If the car touchscreen went out, insurance would have to step in or the car would basically be a $100k paperweight.

What am I missing here?

Extended warranty is an insurance so you may be right that you may never need it. It is a judgement call. I bought for my iPhone for example but not kitchen appliances.

Your car insurance will not cover malfunctions of car parts (unless a result of an car accident).

I have taken the position that the only reason the ESA looks enticing at $2500 is that Tesla values it at $4000.

The definition of a bargain is that it is something you don't need at a price you can't resist.
I will not buy the ESA and if by my 4th year the cars produced for the year before me show a tendency to need lots of service and part replacements then I'll get rid of the car.
With the way Tesla is raising the prices it's helping the resale value of my car.

@contactjohnyoun

zheng94402 & jtodtman answered your questions nicely.

One clarification: Even when the touch screen is down, your car is not "a $100k paperweight", you can still drive it but without the convenience of HVAC for your cabin, stereo system for your ears, internet browsing, rear view camera...

@Tam

Could you control your HVAC through the Tesla APP?

Thanks SamoSam!

I forgot about the redundancy system from cell phone!

Service Plans: wear and tear, usage, aging.
Warranty: manufacturing defects.

Brian what do you think? Have you taken the extended warranty?

You can also change the temps and change to the next song from the steering wheel, among many other things.

I won't be in the market till GenIII arrives, unfortunately.

@Chuck Lusin:

Indeed! even when your 17" display goes dark, there's redundancy in both cell phone (lock/unlock, flash lights, charge, HVAC, Google Maps...) and as well as on steering wheel 4 buttons and 2 scrolling wheels (HVAC, Media, Phone, Energy Graph...).

@contactjohnyoun:

I don't know how much does it cost to replace 17" display and if you think $4,000 is too much to ask, then read how much did it cost for a malfunctioned Prius display: $6,300 plus installation!

http://priuschat.com/threads/multi-function-display-replacement.52778/

@Brian H All things being equal, if Gen 3 were available now what service options would you purchase?

The ESA is only valid if the MS is properly maintained in accordance to the service intervals.
You will need to add $600 12.5K service , plus the ESA $2500 and $200 deductibles for each covered repair.

Concur with zheng94402 that the ESA is like an insurance plan. Since ModS is so new, there is no life cycle reliability data to base a decision on, making the ESA a hedge and giving a little peace of mind for the unknown.

@jtodtman@gmail.com. $2500 is a bargain if you compare what you have to pay for the same class of cars (BMW or MBZ equivalent). Expensive cars are expensive to repair:-)

Only if you use it.
If I trade up to a loaner some time in the future the ESA goes bye-bye with my car.

@ramtaz - I had seen the question about whether the service specs had to be followed for the ESA to remain valid and contacted George B directly given the short timeline. First, huge kudos to him for responding in less than 24 hours - I dare you to find any other executives at any company to be more responsive. Second, and I can provide the language, he said the paperwork is not updated because it is complex given different state laws to comply with BUT, per Elon's announcement, the services do NOT need to be done to keep the warranty valid (ie, the announcement applied to the initial warranty and the ESA both). I do believe your other points about cost (ie, deductible for each occurrence) still hold but wanted to clarify on the services with the updated info

@ RCE, thanks for that information - it might prompt me to buy the ESA after all.

I'll say one thing about Tesla's "mistake" of not pre-announcing the price increase, they sure created a lot of hoopla and now people are buying it than may have otherwise.

@Ramtaz--I don't think you're right. I bought the basic 4 year service plan and the extended warranty. I cancelled when Mr. Musk said that the warranty was in force and effect without the service intervals being met. I drive a lot and would go through the 4 year service plan in two. Since I had to have it to maintain the warranty, I bought it. When I didn't need it, I cancelled it.

I recently bought the extended plan. It makes little sense not to have the plan if you're going to keep the car. I can't imagine repairs aren't expensive for a couple of reasons. First, who can work on the car besides Tesla Techs? If you have to take it in and you have to pay for it and there is no alternative service, they can charge whatever they want. Second, this is a cutting edge experiment and sometimes, I'm the one who gets cut. If something wears out in 5 years and I'm going to keep the car for 10, it makes sense to keep the warranty in force. Another value added is resale. If (and I can't imagine this) I decided to sell, my new buyer would be more comfortable with the extension of the warranty.

+1 @AmpedRealtor and @RCE.

I am going to buy it too, especially after seeing the Prius display costs > $6000.

I am in the same boat as you and am also gonna buy the extended warranty although it will only give me an extra 2 years (50,000 extra miles) So after 4 years (100,000 miles) total I am out of warranty and frankly thats when things break. Had a lexus IS350 that I kept for 184,000 miles with no extended warranty at all. Most of my expenses were after 120,000 miles including navigation going down, display going down and finally needed a new transmission (of course not going to happen with Tesla) I am in 2 minds about the services. Found out too late that you had to prepay within a month. Think I will still do them though because they do tire rotations which i believe they will cost $150.00 al a carte and replace fluid, wipers tighten loose screws etc. Not sure its a $600 value every 6 months but probably safer.

@SCCRENDO - Tire rotation. The San Diego Service Center quoted me $30 to rotate, $60 to rotate and balance. No freebies in between regular service intervals.

tire rotation is supposed to be free for the first time, then included if you have prepaid service plan. according to the service plan agreement on page 2.

Serious question - Does it really cover anything other than the touchscreen? Okay, I was on the fence and I read the ESA. I want to buy it for $2,500, but it literally has so many excluded items it doesn't seem like an insurance policy, as some have referred to it. Has anyone compared what it covers to other brands, like BMW? My BMW plan seems like it was far more comprehensive. My BMW plan also cost more, but it was worth it because it was comprehensive. Love my MS, love TM, but this one has me perplexed.

@RCE.

+1. I just did the same and contact George B. and received a similar response which I just posted in the ESA price hike thread. Great news!

I posted the following question on another thread in the middle of another discussion, but it looks like it will be better here:

Just what exactly is the $600 for? Every year?

A state safety inspection and emissions inspection combined costs me less than $100, and those inspections include checking tire wear, brake system (pad wear and brake lines), suspension integrity, and function of headlights, turn signals and brake lights.

An oil change and tire rotation only costs about $70 together (and that's at the dealership!). A pair of wiper blades, installed, are around $40 depending on what you buy.

A tire rotation, and an inspection that would include all of the safety features listed above plus hoses (pack coolant, cabin A/C and air suspension) and even actively testing all the systems (even the motorized liftgate), shouldn't be more than $250 worth of labor and use of equipment. Add in a Ranger visit, and that's only $350. Add in wiper blades, and you're still under $400.

The only way it would pay is if you need brake pads or a rotor turned at the same time, but in a Tesla, you shouldn't need brake pads for many 10s of thousands of miles, and the rotors should last more than twice that long without needing service.

Even in my hybrid, I've gone almost 30k miles and I'm on the original factor tires and brake pads. Given the experience of others in my family with hybrids, I shouldn't need brake pads until 60k miles at the earliest.

Explanations, anyone?

My thoughts are that Tesla isn't quite sure what they will need to do or how much it will cost to do it yet. As the log of service experience builds the answers will be clearer and the swings will smooth out.

The sudden jump in the price of the ESA supports that theory.

@portia - I checked my service plan pg. 2 and did not see what you see on yours regarding the free first time tire rotation. I have the plan for: Alabama, California, Florida, Hawaii, Illinois, Maine, Maryland, Minnesota, Missouri, New York, Nevada, South Carolina, Texas, Vermont, Washington and Wyoming.

@ stevenmaifert +1, no included tire rotations in the language of the ESA.

Sorry I mean "free"… perhaps that language is in the standard manufacturer's warranty?

I was just repeating what I read in the ESA agreement:
C. Your Responsibilities
The Owner’s Manual includes specific recommendations regarding the use, operations, and maintenance of the Vehicle. To maintain the validity of this Vehicle ESA, You must follow correct operations procedures and have Your Vehicle serviced as recommended by Tesla. If requested, proof of required service, including receipts showing date and mileage of the Vehicle at the time of service, must be presented before any repairs under this Vehicle ESA commence. Service within 1,000 miles and/or 30 days of Tesla’s recommended intervals shall be considered compliant with the terms of this Vehicle ESA.

If this language is no longer valid then I stand corrected and you can buy the ESA without any Annual service requirement.
Thank you for checking with George B.


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