Can You Justify Buying a Tesla?

by Will Lipovsky · 6 comments

buy a tesla
Tesla is an auto brand founded in California by the notorious Elon Musk. Elon co-founded PayPal and also owns SpaceX – the company with a mission to colonize Mars.

While Elon is dreaming of Mars, he builds electric cars. Tesla current makes two models of cars – the Model S and the Model X. The S is a large sedan and the X is an SUV. These cars are renowned. They are safe thanks to their aluminum construction. Also, there’s no gas tank to blow up and no engine that tries to join the passengers during a front impact collision. These cars are also fast – some trim levels going 0-60 MPH in as little as three seconds – that makes the Model S one of the world’s fastest sedan – electric or gasoline. The cars are also extremely spacious since the batteries are beneath the floorboards and the drive components fit into a space about the size of a watermelon. Also, these cars are easy to maintain. You only need to worry about the wiper fluid running low. Did I mention that these cars can drive themselves? Yes, thanks to the recently introduced autopilot feature. I could go on…

Obviously, these are great cars. So why isn’t everyone driving them? One word: Price.

The cars are expensive. As is all new technology. The Model S and Model X can be had for under $100,000 but many trim levels are $100,000+. And you’re mainly paying for the technology. The vehicles aren’t nearly as luxurious as other cars at the same price point.

But what now? As I write this, orders for the Model 3 are now open. What’s the Model 3? The Model 3 is a car that takes all of the major positives of owning a Model S or X and puts them in an affordable car. Tesla is now nearly ready to begin producing a mass-market automobile. Should you buy?

The Model 3 will begin rolling out of the California factory in late 2017. The price? $35,000. I know that may sound like a lot. But here’s why it isn’t.

With all the benefits mentioned above, it’s easy to see that at $35,000, this would be the best car you can own for the money. But it gets better. Most people actually won’t need to pay $35,000. Depending on the state you live in, you are eligible to receive up to $10,000 in tax credits for having an electric car. This would bring the price down to $25,000. That’s comparable with entry-level sports cars like the Subaru BRZ or the Mazda MX-5. But wait. There’s more.

You also never need to pay for gasoline. Ever. You just need to pay for electricity which is cheap in comparison and even free at Tesla charging stations. Did I mention this car is better for the environment than most? You’ve got to love it when a car is good for your wallet and good for the environment.

If you drive a lot (I don’t) I strongly encourage you to buy a Model 3 for the above reasons. It’s slated to be a terrific car. To reserve one, you can go to Tesla.com and put down $1,000 which is refundable. Hurry if you want to get your car next year. You will likely have to wait until 2018 though. As of this writing, they already have hundreds of thousands of buyers who have put down $1,000 – and the car was just unveiled recently.

So should you buy a Tesla? It would be hard to justify a Model S or Model X, though we should be thankful to those who bought them. After all, they paid for the research and development of the Model 3. But now that the Model 3 has all but arrived, I can suggest that yes, it’s worth buying. I would buy one if I drove more.

Can you justify the price of a Tesla Model 3?

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{ read the comments below or add one }

Grinch May 6, 2016 at 9:37 am

I have never ridden in a Tesla, but I have many reservations. Since there are no dealers, where would I get this high tech car serviced? I maintain my vehicles until they die, currently at 170k, 220k, & 245k miles. How long will the Tesla economy car battery pack last? Will I need to order every widget I need to keep it on the road from California? Finally, I’m not sure electricity is cheaper than gas during peak demand. I believe that ICE’s will be replaced in my lifetime, but I’m willing to let others be the guinea pig on Tesla.

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Will Lipovsky May 6, 2016 at 11:07 am

Grinch, indeed! There’s not much to break on these cars so not too married people are worried about break downs. The only fluid to monitor is windshield washer fluid, for instance. Tesla has service centers instead of dealerships. There’s an 8-year, unlimited mile battery and drive unit warranty. You don’t even need to take advantage of free over-the-air updates if you don’t want to. As per the peak demand, it’s time to get (or build) a Tesla power wall. I understand not wanting to be the guinea pig. According to Consumer Reports, Teslas do have slightly below average reliability. But they are new cars. 1.0, if you will. So things will improve. The cool thing about buying a car early if that you’re funding the R&D that is accelerating the advent of electric transport. So people willing to take the risk with Tesla’s are really doing humanity a favor. It’s not just about having a cool car for many Tesla owners. ICE’s will be gone very soon either way though.

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Rick Hanton May 2, 2016 at 9:16 pm

I think the biggest problem with this piece is that you haven’t necessarily done the math and are telling people that they still have a chance of getting the Federal electric vehicle write-off. This is highly unlikely for anyone who gets their Model 3 in 2018 or later because the write-off is based on the number of vehicles a carmaker produces and Tesla is slated to reach that goal within the next two years based on sales numbers. So it is not correct to assume you’ll get the + tax break Model 3 price if you reserve one today. You want to be sure you can support the full price of the car in a few years – though you’ll still save money on gas and I still think Teslas are awesome. Thanks!

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David Ning May 5, 2016 at 9:25 am

Good point about the federal tax credit. I wouldn’t be surprised if people are decking out model 3s with options that end up being $50k+ too.

On the other hand, I heard Tesla wants to build an even cheaper version in the future? That would be sweet, since I think a very low cost commuter fits very well with the concept of electric cars.

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David Ning May 2, 2016 at 12:40 pm

I think it’s amazing that someone can still build a car manufacturer from scratch in this day and age but I don’t love those cars like many other people.

One of my friends actually put in an order for 2 Model 3s. He claims he has a need for both those cars for himself/his family but I doubt he’ll just buy those two cars if they were available for him at the same time.

Haven’t said that, I’m going to test drive the Model X with my friend who is interested on Wednesday though so it’s possible that I may become a fan boy in a couple days 🙂

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Will Lipovsky May 2, 2016 at 1:02 pm

Yes! Even if you’re not a speed freak, punch it while passing someone. It feels incredible.

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