By on March 25, 2019

Tesla Model S Grey - Image: Tesla

Over the weekend, Tesla CEO Elon Musk asked the world to “please note” that prices on all Tesla inventory would rise by about 3 percent on April 1st. While it sounds like the setup to a particularly bland April Fool’s prank, Musk followed up by saying, “To be clear, this doesn’t affect Tesla website order prices. Existing inventory prices are currently slightly lower than on website. This will bring them in line,” which is only slightly funny.

The automaker is also scrapping its extended service plans, intended to provide annual maintenance on its vehicles. Considering how often Tesla adjusts pricing, this is the bigger story. But let’s give the money matters a little attention before making our deep dive into the company’s bold reliability claims (which is Tesla’s stated reason for the yearly maintenance program’s kiboshing). 

The pricing increase officially begins at midnight on April 2nd, meaning individuals willing to settle on a pre-fab Tesla can save themselves 3 percent if they act quickly. However, those waiting to customize their vehicles online already found themselves subject to a (variable) 3-percent MSRP hike earlier this month. Basically, this brings Tesla’s unsold inventory up to par with new-model pricing in the coming quarter.

Moving on to the maintenance program, Tesla doesn’t think it needs to bother. It says electric vehicles don’t require annual maintenance and regular fluid changes, so customers can fall back on as-needed servicing without fear. Previously, the company recommended servicing the Model S and X once per year, or every 12,500 miles. Meanwhile, the Model 3 was said to be good for a checkup every two years or 25,000 miles. That’s changed.

While it may be true that an EVs wellbeing does not hinge on spark plugs or oil and transmission fluid exchange, Tesla did acknowledge that its customers will still need to stay on top of servicing duties related to brake pads, brake fluid, calipers, filters, and air conditioning — even though those items were previously included as part of its extended service plan.

That sounds fine, but Tesla’s reliability has been called into question by both annoyed customers and independent studies. Fortunately for Tesla and its fan base, very few of these issues have anything to do with the powertrain (which has been the case with EVs in general). Most of the guff Tesla garnered from Consumer Reports of late revolves around manufacturing defects resulting in lackluster fit and finish. While those complaints have been enough for the outlet to redact its earlier recommendation on the Model S and 3, both vehicles still rank highly among electric cars and hybrids.

We also know that a glut of minor problems have helped overwhelm the company’s service centers. Wait times are frequently longer than they need to be, with tons of anecdotal evidence of cars coming back in no better shape than when they left the owner’s garage. With Tesla planning to eliminate storefronts and minimize the need for parts distribution centers, it makes sense that it would want to suspend its vehicles’ premium maintenance schedule. But what about all the people who already bought in?

Tesla says customers who purchased extended 3- and 4-year service plans can request a refund of the remaining length of the plan. However, it still recommends they come in for tire rotation and balancing every 12,000 miles, regular winter maintenance (every 12,500 miles in cold climates), and a fluid/filter checkup every 2 years.

We’re curious to see how this plays with the public. On one hand, Tesla can humblebrag that its powertrains are more reliable than internal-combustion engines and require a less rigorous maintenance schedule. Fewer people bringing their cars in should also help make repairs and servicing run a little smoother. Musk said that improving service in North America was among the company’s biggest concerns earlier this year. However, this could seriously backfire if Tesla turns out not to be 100-percent accurate in its reliability claims.

[Images: Tesla]

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26 Comments on “Tesla Raises Prices, Eliminates Maintenance Plans, Claims EVs Are Too Reliable...”


  • avatar
    indi500fan

    My buddy’s daughter has an S.
    She was just telling me yesterday how reliable it is.
    Replaced the battery pack once and the drive motors twice in 100,000 miles.
    All on warranty.
    She was unhappy that the “Tesla Ranger” doesn’t come too her house any more for fixing stuff, she has to drive it to the local service location.

    • 0 avatar
      Ryoku75

      Arent Tesla service trucks Fords?

    • 0 avatar
      Niq

      Wow. That’s the most reliable vehicle I’ve ever heard of, ever! She got a super duper reliable Model S.

      My colleague only got one of the super reliable Tesla Model S… not duper, though.

      His super reliable Model S, in 100k miles, had to have its motor replaced 4 times and the door handle actuators like every year.

      He was shocked when shopping for a new car to replace his Model S, when I referred him the True Delta website, that Tesla was at the bottom of reliability rankings.. seriously.. he was.

    • 0 avatar
      Master Baiter

      “Replaced the battery pack once and the drive motors twice in 100,000 miles.”

      That would probably have cost $30K if out of warranty.

    • 0 avatar

      I know this isn’t the same thing, but I’ve replaced my battery 5 times and still have the same “motor” at 253,0000 (no overhaul or other major engine work). Does that mean I got a super, super duper deal? :)

  • avatar
    stingray65

    From what I understand extended warranties and maintenance plans are highly profitable, because customers are willing to pay much more than the services cost the manufacturers (or 3rd parties) to provide. So why would an unprofitable company such as Tesla be dropping what should be a very profitable service plan when the cars are supposedly so reliable and in so little need of maintenance?

    • 0 avatar
      Niq

      ^ This exactly.

      This is where dealerships make money… the service plans, warranty, and insurance extras that are never used. And of course traditional dealerships make money from warranty repairs they charge to HQ.

      Tesla’s largest overhead cost is warranty repair. It’s absurdly high, relatively speaking. There was an article or two awhile back. They’re basically bleeding cash fixing their cars under warranty.

      This explains why so much stuff on the Model 3 is not covered under warranty, which includes anything to do with fit and finish. Squeaks, rattles, loose parts, crooked trim, etc are specifically not covered under warranty on the 3. So far it looks like they are doing the work based on posts.. but eventually, they will flat out refuse and can since it’s in the paperwork.

      (… oh, and even funnier in the warranty, apparently Tesla doesn’t know autocrosses are a form of racing)

    • 0 avatar
      MBella

      Third party warranties are hit or miss, with way more misses than hits. Manufacturer plans can be useful, since you cannot get the same price the manufacturer pays for the work to be performed.

  • avatar
    mmreeses

    ha, I call shenanigans! Nice try Department of Newspeak.

    If Teslas were so reliable, Tesla would be dying to sell you some extended maintenance plans. As writing a contract would be pure profit.

    but the actuaries have spoken

  • avatar
    Ryoku75

    This will only fuel the delusion of Tesla owners that their cars require no maintenance. EVs might require less maintenance than regular cars, they’ll still need it from time to time. Tires, brakes, lights, suspension, bodys, none of that lasts forever. Even on reliable cars.

  • avatar
    thornmark

    I believe CR took all the Tesla models off the recommended list – too many problems

  • avatar
    MoDo

    They can barely make it 25000 miles on one motor, some high mile cars have had 3-4 of them replaced. To say they are “too reliable” is laughable. People just didn’t care because they were covered and now they won’t be.

  • avatar

    Much ado about nothing. Firstly Tesla has no competition so can set prices as high as it can and 3% is nothing for those who can afford luxury cars.

    Secondly there is a difference between maintenance and reliability as if you trolls do not know. Automaker is not supposed to replace for you brake pads and tires. And reliability issues are fixed under warranty FOR FREE!

    Yeah but you B&B (as if) can continue to troll and pile up on every EV maker. ICE engine is dead even Germans agree now just get over it.

    • 0 avatar
      SC5door

      “And reliability issues are fixed under warranty FOR FREE!”

      What is a reliability issue? A failed drive motor? That’s not “reliability”, that’s a mechanical issue. Any any way you attempt to slice it means that the car IS NOT RELIABLE. Imagine having your transmission or any other vehicle replaced several times before 100K, you’d be whining and crying about it being a lemon.

    • 0 avatar
      APaGttH

      Ya, ICE engines are dead, that’s why they’re sold in 99% of vehicles sold around the world. Totally dead.

      Someone got triggered. I suggest decaf.

  • avatar
    APaGttH

    You eliminate a product line for two reasons:

    1) It isn’t selling
    2) It isn’t profitable

    Given there are peeps who bought in who can request a refund (ummm, they should know who those people are, shouldn’t the refund just happen) it sure doesn’t seem like (1) is the issue.

  • avatar
    SuperCarEnthusiast

    It the opposite of what they Tesla say! Comes out of ?Tesla Public Relations!

  • avatar
    ToolGuy

    Traditional dealers are scared to death of this aspect of EV’s.

  • avatar
    0Gravity

    Inflation is roughly 2% per year in the US so a 3% increase is barely a price rise in real dollars

  • avatar
    sirwired

    “We’re just making too much darn money off this product! We should stop selling it!” – No CFO Ever

    Seriously, an ICE hardly requires piles of TLC for quite a long time. An oil change twice a year (if that), a new engine air filter every couple years, and transmission fluid every 3-5 years is not exactly a major investment in money or time. Even at dealer rates, it’s not terribly much. (And as a DIY, it’s a rounding error.)

    With modern spark plugs, that’s generally the first time anything resembling actual work is usually required, and that’s not until 100-something k these days. (And that’s only a bit deal on a transverse V6; it’s a 10-minute job on an I4.)


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