No free charging for Model 3? Tesla can explain
Tesla Motors CEO Elon Musk may have disappointed some prospective Model 3 owners by telling them that his new electric sedan will not include free supercharging at the proposed $35,000 base price.
The current Model S and Model X Teslas, which are sold with much higher MSRPs, include free use of the company’s extensive supercharging network.
But the Model 3, which Tesla will commence building soon and hopes to begin delivering in late 2017, will not.
Musk appeared at some pains to explain, at a Tuesday shareholder meeting, that his Fremont, Calif.-based car company can’t afford to sell the car at that price and include free juice.
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The only way to bring the Model 3 to market at the proposed base price, he said, “is to decouple (free supercharging) from the cost of the Model 3.”
Free access to the superchargers could be purchased as an option, or a package, Musk said at the meeting in Mountain View, Calif. “But it will not be free long-distance charging for life unless you purchase that package.”
Dressed casually in jeans and a sort of safari jacket with the collar turned up 1980s-style, Musk seemed eager at several points in the long Tuesday presentation to have his audience of shareholders, Tesla employees and owners understand that his electric car company isn’t trying to gouge anyone – even though the average transaction price of Tesla’s Model S is over $100,000, and the price of its Model X SUV is often higher.
Tesla is making the cars for as little as it possibly can, and pricing them accordingly, Musk said.
“The Tesla price is based on a roughly 20-25% mark-up on our cost of production,” he said. “The price is based on what our car is costing. Then we aspire to add roughly 25%, which has to cover all of our sales costs, and the overhead and the engineering and the R&D and investment for future product.”
If the company adds a charge for something extra, like super charging, a higher trim level or special technology, Musk said, “it’s because we can’t figure out how to make it less expensive.”
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But the Tesla cofounder also suggested that, except for people making long-distance trips, electric car owners shouldn’t be using the available charging network anyway – because it’s a waste of their valuable time.
“Driving to a supercharger in order to get five dollars worth of electricity, and spending half an hour of your time, you’re maybe barely at minimum wage,” Musk said with a laugh.
So, why do they do that? Musk blamed it on traditional fueling stations.
“People are used to a paradigm where they go to a gas station to fill up, so they get an electric car and they go to a supercharging station and fill up,” a clearly amused Musk said. “A lot people people are used to an old way of doing things. But it doesn’t make sense. Would you take your phone to a gas station to charge it?”
Follow me on Twitter @misterfleming
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