Studio711.com – Ben Martens

Why We Bought A Tesla Model Y

Tyla and I are now the proud owners of a Tesla… order. Yep, we’re jumping into the battery powered vehicle game, but there are so many other orders in right now that the currently estimated delivery date is May.

It’s Electric Boogie Woogie Woogie!

Our Escape has around 95,000 miles on it. It should have more life in it, but we haven’t had the best relationship with it and it’s giving us more and more reasons to worry about it’s longevity. So we went car shopping and landed on a Tesla Model Y. Specifically, here’s what we ordered:

  • Model Y Long Range Dual Motor All-Wheel Drive
  • Deep Blue Metallic Paint
  • All Black Premium Interior
  • Five Seat Interior
  • Autopilot

There was a lot of research between “Hey, let’s buy a car” and “Hey, let’s get a Tesla.” So this post will get long, but I’ll go through a bunch of my questions, and if you have others, feel free to shoot them my way. Even though I will cite many references along the way, I’m not going to take the time to cite everything. I’m not here to convince you that you should do this too. This was a way to help me go through all the questions I had and organize my thought process. But if you’re EV curious, I think some of this will be helpful to you too.

How far does it go on a charge?

For me, electric vehicles were synonymous with “range anxiety”. But battery tech has improved rapidly and the Model Y that we ordered has an estimated range of 326mph. We rarely go more than 100 miles in a day (average is 80 on school days) so even if we keep our battery charge between 20% and 80% for maximum battery lifespan, we still have double what we need.

Are there chargers near me?

The short answer is yes, but we’ll rarely need them. We’ll only use chargers on a road trip, and when we’re on a road trip, the Tesla charging network is pretty hard to beat. The Tesla website shows all of their super charging stations. On top of that, Teslas can be charged at regular EV charging stations too.

This video shows an example of taking a Tesla, a Mustang Mach-E, and a gas car on a 1000 mile road trip. I’m sure not every trip with a non-Tesla EV would be that frustrating, but it certainly gives one example of how Tesla’s vertical integration is a bonus for owners.

How long does it take to charge?

If you stop at a super charger, you can get 30% battery life added in 9 minutes. 80% takes around 30 minutes. At home, it will be slower and it depends on the circuit that you’re charging from. The Tesla site has a handy chart that gives an estimate of the mileage gained per hour of charging. We’ll have a NEMA 6-20 adapter which means that our Model Y will recover our ~80 miles per day in 6 hours. Thankfully I had a a 220v 20amp circuit put in for the table saw and since I use that very infrequently, I’ll share the circuit for now, being careful to unplug the Tesla when I’m woodworking. We might add a dedicated higher-amp circuit in the future but that will likely require a subpanel so I’m not eager to jump on that project.

From my research, it seems like non-EV owners think about how long it takes to charge the battery and EV owners remember how long it used to take to fill up with gas including the drive to the gas station. EV owners comment on how every time they walk out to their car, it’s full. It’s like having someone stop by your house every night and fill up your cars with gas. There’s no waiting for the battery to charge because it usually happens when the car is in the garage and you’re doing other things. Assuming that a night of charging will refill what you used during the day, the only time you care about charge speed is when you’re on a road trip.

How much does it cost to charge?

The Model Y comes with a 75kWh battery. We pay $0.10/kWh so even if we charged it from 0-100% that is $7.50 (plus some lost electricity to heat, etc). Or if you’re trying to compare with gas prices, our Escape averages around 23mpg. It would cost $0.53 in electricity to power the Tesla for the same distance as a gallon of gas in the Escape.

What kind of maintenance is needed?

This is one of my favorite parts. There’s so little maintenance to be done. We’ll still need to buy new tires and maybe a bit more frequently since the car is heavier than a gas car, but other than the scheduled maintenance list is pretty bare. I thought electric cars went through lots of brakes, but the opposite seems to be true. When you lift off on the gas in a Tesla, the motors reclaim the energy meaning that you generally only use your brakes to stop the final few mph or in a panic situation. So we’ll need to replace our cabin air filter, rotate the tires, and that’s about it. It sounds like tires might need to be replaced more often but it’s hard to tell if that’s because the car is a bit heavier or because people like to experience the acceleration.

Which kinds of cars are better for the environment?

I almost didn’t include this in the list because my motivation is mostly monetary. But I did look into some of the claims that electric cars are worse for the environment than gas cars. It doesn’t take much looking to realize that electric wins out pretty easily. Even if the battery pack needs to be swapped out, the old one is mostly recycled. I’ll leave the rest of this to a short video and you can do your own research if this is a big point for you.

How would we take road trips?

I don’t know if I could make the EV leap if I didn’t have a second car, but we’ll still have the truck. I’m hoping to keep that around until it’s dead. Even with the extra gas price, we do love the extra room and easy packing for road trips. So if we ever need to take a trip and don’t want to mess with charging, the truck is our go-to vehicle anyway.

While driving, Tesla keeps an eye on your battery levels and where you’re planning to go so it can suggest charging stops. Their website has a similar trip planner. A long cross country trip adds up to a lot of stops, but when’s the last time I was more than 300 miles from home? So in almost all cases, a road trip would mean a stop for 20-30 minutes (or a couple 10 minute stops) to get us comfortably back home.

Let’s use Cannon Beach, OR as an example since that’s one of the longer trips we’d make. The trip planner says we would stop in Kelso, WA for 25 minutes on the way there and 35 minutes on the way back. But given how often my family needs to stop at the bathroom, I could easily see turning that into a few 10 minute stops along the way. But again, if we’re going to Cannon Beach, we’re probably taking the truck anyway.

How long does the battery last?

I thought battery packs would degrade pretty quickly, but Tesla warranties them for 8 years or 120,000 miles, whichever comes first with minimum 70% battery retention. That 70% number looks scary, but remember that’s the warranty line. If you look at actual data, Model 3’s and Model Y’s (similar battery packs) are going 400,000 before they hit 20% battery degradation. So even if the number is somewhere in between, it’s far enough out that by that point I’ll want newer battery technology anyway.

Does it drive itself?

Sort of. Let me break it down.

  1. Drive it yourself like a normal car.
  2. Engage cruise control. It is a “Traffic Aware Cruise Control” so the car will automatically slow down if someone pulls out in front of you, etc. You can adjust how closely you want to follow other cars on the highway if the car in front is going below your set speed.
  3. Engage Auto Pilot. At this point, the car will steer for you too. Think of it like cruise control that includes both speed and steering. It will stay in the lane and adjust speed as necessary but you still need to change lanes, stop for stoplights, etc. Some people have described it as driving with a new teenage driver. You need to pay attention and it doesn’t always anticipate things until after the point where you get a little nervous. You still have to pay attention and the system will warn you and disengage if you’re not attentive, but it takes a lot of pressure off once you’re comfortable with it. This comes free with every Tesla, and it works on almost all streets, not just on “mapped roads” like most other car makers.
  4. Full Self Driving. This option costs $10,000, not because it adds any hardware to the car, but because of the feature that it unlocks. With this option, you can tell the Tesla where you want to go and get end to end automated driving. It will stop at stoplights, change lanes on the highway, navigate to your parking spot, etc. This is also the feature that enables things like “summon” where your car will come to you in a parking lot. I love this tech and the incredible effort that’s going into it behind the scenes, but it’s too much money for me right now. Plus, we will have the option to subscribe on a monthly basis for $200, so maybe we’ll try it out at some point. The feature was very recently released in beta to a wider group of people, but it’s not something you can just jump in and use immediately. You still have to get selected for the beta based on your driving safety.

What’s the cost comparison between an electric car and a internal combustion car?

This is the big one. Aren’t Teslas for rich people? Is an EV really cheaper than a gas powered car? For me, it’s close enough to a gas car that it’s hard to say for sure. If I take a serious look at gas cars, I think we’d probably end up with a nice version of a Ford Escape. Pricing that out, the Model Y is about $20,000 more expensive. Let’s compare the two cars for a lifetime of 8 years because that is how long we’ve had our current Escape. The mileage numbers now are significantly different because Elijah goes to school 20 miles away (80 miles per day.)

  • At 18,000 miles/year and an average gas price of $3.50, the Escape would use about $22,000 in gas. (That gas price feels conservative to me if we’re talking about eight years but let’s go with it.) The Tesla would use $3,300 to go the same distance. We’re already in the same ballpark.
  • In the last 8 years, our Escape has cost us $4059 in service. The web gives numbers of $800-$1000/year for service on a gas vehicle but that is probably more true for cars when they are out of warranty. Estimates for Tesla service/year is in the $300-500 range. The exact numbers are difficult to pin down here, but the Tesla likely is coming out at least a couple thousand ahead here.
  • Now for a really difficult one: resale. How much is that car worth after 8 years? Fast forward 8 years into the future and my opinion is that it’s going to be a lot more expensive to drive a gas vehicle as the switch to electric has really intensified. The market for gas vehicles will be dropping, but even ignoring all that, the resale values for Teslas is stronger than for Escapes.

Even if I take somewhat skeptical estimates in favor of gas vehicles, I at least end up with a comparison that is pretty even and the longer I drive that electric vehicle, the more the scales tip in its favor. The up front price tag looks huge and I have a hard time paying it, but if my experience is like most other people, it will pay off… and I’ll be having a lot of fun driving the electric vehicle while it’s paying off.

How do updates happen?

The car downloads updates frequently. Updates can include anything from new functionality in the infotainment center to better range through improved battery management or even adjustments to airbag deployment algorithms to make the car safer. It’s not like the cars we are used to buying that rarely, if ever, receive a software update.

And the exciting thing about Tesla building an EV from the ground up is that seemingly everything is connected to the computer so when someone has a good idea bout a new feature to add to the car, it’s just a software update. For example, the Tesla has folding mirrors. And the Tesla has GPS. That’s not unusual… but you can program your Tesla to automatically fold in the mirrors when you get close to your garage and unfold them after you leave. Or how about that reverse warning speaker that’s on the bottom of the car? They released an update so you can play Spotify from it while you’re washing your car or at a tailgate. The possibilities are endless.

Can I watch video on the big screen in the car?

Yes. You can watch Netflix, YouTube, and other providers while the car is parked. And remember that this is all battery power. So if you’re waiting to pick your kid up somewhere, you can be sitting there with the heat or AC on, watching a video. It’s not like the old days where you’d be freezing or sweating because it wasn’t worth running the engine just for climate control and entertainment.

The infotainment unit also includes built in Spotify (though you need to connect to your account). You could still pair your phone via Bluetooth if you want, but you can also just have the car use it’s own cellular connection.

The cellular connection for the car costs $10/month and enables traffic display on the screen along with video and music streaming. Alternatively, you can tether your phone via WiFi and let your car use your phone’s internet connection without paying the $10/month to Tesla. I wasn’t thrilled about this fee, but we already pay for Sirius so we’ll drop that and add this for a few bucks more. Or maybe we’ll get to the point where we always pay for unlimited data on our phones and then we can drop the Tesla subscription and use tethering instead.

Does Tesla accept trade-ins or offer financing?

Yes! Tesla does offer financing, and for trade-ins, you get a quote right from their website. So just like any other car dealer (at least in our state), that means you pay less sales tax on the new car. The quote isn’t good forever so you need to keep updating it while you wait for your car to arrive. On delivery date, you drive in your old car and drive out your new car. Or you can sell the car to Carvana, CarMax, or a local dealer. So far, all the online sales sites have given me similar estimates. I’ll check with my local dealer when the actual delivery date gets closer. They’ll have to be significantly more than what Tesla offers since I’ll be saving on sales tax if I trade it to Tesla too. And if you’re wondering, Tesla immediately resells the cars unless you’re trading in another Tesla.

How long does it take to get a Tesla?

Tesla offers shorter waiting time for higher margin vehicles, but if we order today (October 2021), the default Model Y has an estimated delivery of August 2022. If you pick any upgrades on the Model Y, then the estimated delivery date is May 2022. These dates are due to some combination of extreme numbers of incoming orders and supply shortages.

On a side note, this article from Fortune is an interesting read about why Tesla isn’t as impacted by the chip shortage as other car manufacturers.

Why Tesla?

I said “Tesla” a lot in the answers above, but why not another EV provider? Ford is coming out with the Mach-E and the Lightning. Nissan has had the Leaf for years. Chevy has the Bolt. Volkswagen seems like they’re a pretty strong contender in the EV market, so why not one of those?

Longest history

Tesla has been building electric vehicles for a very long time. The first Tesla roadsters were sold in 2008, and they aren’t moving at a slow pace. Some of the big automakers scoff at them and say building a electric car is a lot harder than making some batteries and motors. That’s true and Tesla has had their struggles, but build an electric car is also a lot harder than building a chassis and suspension. The big automaker have a long way to go to catch up in battery technology and production, and even though they have a lot of factories built already, EVs require a lot of new materials to source, particularly for batteries. Will they be able to find enough materials to make use of their big factories?

And of course it’s not like the big car companies are immune from quality problems either. Ford mocked Tesla for the recall for the glass roofs that could come off in some circumstances and then had to eat crow when the Mach-E had the same issue.

Car and Driver did a 1000 mile comparison of EVs from all the companies and Tesla didn’t just take the top spot, they took the top THREE spots.

Safest

When you look at a gas powered car, they have a giant engine block under the hood which isn’t very good at absorbing impact. EVs have huge amounts of crumple zones in the front and back. On top of that, Tesla has tons of data about every accident every one of its cars has been in. They use that data to continuously refine their models and they can even improve the safety of the car through over-the-air updates. The Model 3 was the safest car ever tested by the NHTSA and if you watch the video linked in the previous sentence, you’ll hear them say that the NHTSA requirements are just a drop in the bucket compared to the real world situations that they are testing.

Most popular

The Model was the first EV to sell 1 million units and the Model Y looks to be on pace to hit get there even faster. Europe is much farther down the EV conversion road than the US, but over there, there are more Teslas sold (15.3%) than diesels (13.8%). Yes, you read that right. 15% of all cars sold in Europe in September were Teslas. The Model 3 was the most popular car (not just EVs) sold in Europe in September. In Norway, 80% of vehicles sold are electric and over half of those are Teslas. Globally more Model 3’s are sold than other cars in its class like BMW 3’s, Mercedes C-Class, and Audi A4.

Anecdotally, driving around this area, we average seeing about one Tesla per minute on the roads and there are more and more sold every day. It took us a month and a half just to get a test drive! Demand is through the roof in our area. (In fairness, our first test drive was scheduled right at the end of Q3 and Tesla made a huge push to deliver EVERYTHING to help their numbers so we had to reschedule.)

Highest market cap

There’s generally something to the wisdom of the crowds and the stock market has given Tesla a higher market cap than all the other car makers combined and they are currently one of the few companies in the world to be valued at over a billion dollars. Hertz recently put in a $4.3 billion order to make 20% of their fleet be Teslas. All this investment doesn’t mean that Tesla is definitely going to win, but it’s a positive sign.

Car buying experience

We walked into a dealership twice and walked out on our own time without anyone making us feel awkward or pushing a sale on us. When we finally decided to order the car, my biggest decision was whether to place the order from my phone or my computer. The car buying experience is magnificent compared to the hassle of haggling with a dealer on price, trade-in, warranties, and financing. The experience inside a Tesla store isn’t an accident. It’s a careful ballet to make sure they don’t cross into illegal territory by talking about sales. This video does a good job explaining the laws around dealerships and why they continue to exist for other car manufacturers.

American made

Everyone likes to say they are American made but the reality is that today’s cars are global creations and some percentage is done in the US. Tesla takes two of the top three spots for being most American made.

Why the Model Y?

The price of the Model 3 is what sucked me in. Back then it was under $40k. The comparison to a gas power car gets REALLY easy at that price point. But then I started thinking that I would like to have all wheel drive which bumped up the price. Then I started looking at the size difference with the Y and thought about how much we’ve enjoyed the space in the Escape. So we bumped up to a Y (which is currently only sold with all wheel drive so that works out.) The Model 3 and the Model Y are very similar in construction so most of the benefits I had found of the 3 generally apply to the Y as well. It was hard to swallow a sticker price that high but I kept reminding myself that I was optimizing for the total cost of the vehicle over its lifetime… and I was getting really excited about owning a Tesla after doing all the research!

Why choose those options?

There aren’t a lot of choices to make when ordering a Tesla, but we decided to pay extra for the blue paint instead of the default free white color. There are so many Teslas around here that it’s nice to not have the default color and we both really liked the blue. I’ve always wished we had paid for a nicer color on the Escape so this time we’re just going for it.

We were very close to paying for the 20″ black rims and the tow hitch too but decided against it in the end. The black rims look fantastic but tires are more expensive for it and it’s a lot of extra money for something we could change later if we wanted to.

The tow hitch was a similar cost decision. Tesla will add the same thing for us later for just a little bit more money or I can install an aftermarket hit myself for ~$600 cheaper. I don’t see us ever towing anything with it, but it’s a great place to add a bike rack. I’ve already thought about adding a tow hitch bike rack to the truck to make packing for trips easier, and the receiver is the same size on the Tesla so one bike rack would work on both vehicles.

What could go wrong with this plan?

The biggest concern I have is that my math is wrong. Predicting the future of gas prices, how long a car will last, and how much service it will need is pretty flaky. I spent a lot of time debating whether we should try to push the Escape into the 160k-180k range or take advantage of the high resale rates now and dump it. In my research, there appears to be a big drop off in the longevity of the Escape in 2013 (our year) when they switched to the new Ecoboost engine. They made some goofy design decisions in the first years after the switch that are giving people fits. I’m not a mechanic and maybe it would still be cheaper to keep it even if we had to replace the transmission or the engine. I will probably always wonder.

From the political angle, there is lots of news about Tesla’s self-driving features, especially with the recent appointment of a very anti-Tesla NHTSA senior safety advisor. Tesla is taking a different approach to a lot of things so it’s not impossible that some laws could come down that crack down on the features that we already paid for (like Autopilot.)

I’m also assuming that by the time we are ready to sell this car sometime in the 2030’s major car manufacturers will either have stopped producing gas vehicles or the end is near (for most common consumer situations.) I’m expecting tax penalties for gas vehicles and Washington state has already said they want to be one of the first to implement those. So if we were to buy another gas car today, I would buy it with the knowledge that I probably won’t get much for it when I try to resell it. Or maybe they’ll be hot commodities if it’s hard/expensive to buy new ones. If any of that doesn’t pan out and this EV thing dies like it did last time then I made a bad choice.

When I was in high school, I read a book with survey results from a bunch of people who were self-made millionaires. (I think Chris Hogan’s Everyday Millionaires book is a similar, but updated, book to whatever I actually read.) That book from the 90s said that a huge percentage of self-made millionaires had never bought a car for more than $30,000. Obviously that needs to be adjusted for inflation now, but that sentiment has always stuck with me. Cars are generally a terrible thing to spend money on. Investing the same amount of money as a car would have a huge positive impact on retirement. So buying any new car is a huge decision for me and even more so when I’m paying more up front and hoping to recoup it over time.

Another big issue is that Tesla could fail. If they go down the tubes, I don’t expect the government to come bail them out. They clearly have no problem with demand for their product, but if they can’t ramp up their supply side, the whole thing could come crashing down. They have two giant new factories coming online in Berlin and Austin but there will have to be more in the works too since the lead time on a new factory is so long.

Yet another risk is that our current car could die before we get the new one. What do we do if we have to put another grand or two into the Escape before our Model Y is ready for pickup? If we really get into a bind, we can cancel our Tesla order and choose another route. The lead time on the Tesla is one thing that makes this a challenging decision.

I have spreadsheets and lot of tossing and turning behind me. From this long post you can see where we landed on the decision. If you remember my F150 purchase post, you know that I heavily analyze all this stuff. This Tesla decision is definitely skewed toward the fun/luxury side but I also don’t think it’s a gratuitous or ostentatious purchase. Maybe it’s a couple years early to make the jump to EV, but in 3-5 years, I think this decision will be much less surprising or difficult. I’m willing to lean towards the future even if I can’t say with 100% certainty that this is a cost effective decision today.

Disclaimer: I own TSLA stock. Nothing that I say should be taken as stock advice. Do your own research.

… I can’t drop that disclaimer and end the post without saying more. I’ve said before that I’m all about sticking with a simple index investment plan. I stick to that very strictly, but during my research, I got so excited about Tesla and where I think it’s heading, that I bought one share of their stock. That being said, I might sell it soon because I feel dirty looking at my portfolio and seeing more than just my three beloved index funds.

Note: Amazon links are referral links which give me a small kickback at no extra cost to you.

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