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Tesla Model 3 Payments Prove It Will Never Be Affordable

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The Model 3 Tesla is revered as the cheapest car Tesla has ever built. This is true, and it allows a great deal of Tesla Inc. (NASDAQ:TSLA) admirers to finally get Teslas of their own. Just how affordable is the car, though? By all intensive criteria, can the new mid-sized electric sedan be considered a mass market car?

One analyst argues otherwise. Donn Bailey claims the car is far from pocket-friendly. Buyers will eventually come to the same conclusion once they consider costs to insure their affordable EV. There is also the cost of home charging, something overlooked too often. Can the everyday man afford the increased electricity bill?

This article reiterates findings that suggest the new Model 3 is only deemed affordable by reputation. In fact, typing the word “affordable” into your Google News search brings up a host of Tesla 3 articles. They get points for sensationalism, no doubt. As is often the case with Tesla, though, a closer look reveals inherent charges which somehow fall to the wayside.

The last 18 months or so show Tesla Inc. assuring investors about the success of the Model 3. Assurances derive from car reservation numbers. Credit where it is due, the company manged to draw in a staggering half a million-strong buyer’s list ahead of the car’s release.

But Musk and his company argue that their new car will turn the affordable vehicle market on its head. This should truly start taking effect in 2018 according to market watchers. Their assertions are based on the company’s production promises, current demand and that little extra sensationalism inherent of Tesla.

Tesla Motors Inc (TSLA)
The Model 3 concept from Tesla Motors

The promise is that buyers can get a good-looking and very capable niche car for as little as $35,000. This is the true allure of the Model 3. It is the build-your-own Tesla in a way. For an extra $9,000, buyers can get it with 310 miles of range. Range would come beyond that of the entry-level Model S in this case. The most affordable of Tesla’s flagship car goes to for $72,000. This price tag only gets you a car that goes 249 miles on a full charge.

Truly affordable Model 3 from Tesla

It feeds the argument that Tesla’s newest offering will gobble op Model S buyers. $44,000 gets you get a brand new and more capable Tesla. When it comes time for a new car, Model S owners will realize they can add a host of extras on their Model 3, like autopilot, and still get a new electric car that is cheaper than their current.

What Model 3 fans don’t always hear about, though, is the near 65,000 Model 3 cancellations as of July. Bailey says the rate of people reconsidering their orders will more than double over the next year. Once the costs of EV ownership are considered, monthly payment will prove beyond what most people signed up for.

Teslarati.com offers a nifty payment calculator. It is a tool every reservation holder ought to consider using. Ignoring payments of the lease, the Model 3 will require up to $1,000 in additional monthly charges. The low point of that estimate is $700. This comes up to average mortgage payment for individuals in the mass market car space.

More details and calculations can derived from this web link.

To conclude, the Model 3 base price tag is what rakes people in. It is only upon closer inspection that people learn the true cost of owning the car. An additional $1,000 for a mass market car is not reasonable for most. It adds to yesterday’s argument about the car not selling beyond 200,000 per year after reservations.

However, new reservations for the Tesla Inc. (NASDAQ:TSLA) Model 3 are running at 1,800 a day. Most of these people know that they will not get much or any tax credit or low upkeep costs. What they counting on is that they will get the best electric car available for their money.

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Mvusi Ngubane

2 Comments

  1. This article makes no sense. According to the calculator, ignoring the cost of financing, the monthly cost is less than I pay for gas alone now. Cars cost what they cost, gas or electric, you still have to pay cash or finance. Nothing new here.
  2. As the gentlemen mentioned above, cars cost what they cost. If you compared this to a gas vehicle equivalent such as a V-6 Accord or Camry, you’d see the Tesla 3 costs greatly less after gas savings. And to those of us who will receive rebates, your actual costs are now approaching entry level car of $20-25K.

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