Featured Tesla loses the race for mainstream EVs to GM

Edmunds has a total cost of ownership calculator for 5 years.
2020 Subaru Outback: True Cost to Own | Edmunds
Not perfect, but a decent starting point.

 

One thing we may want to consider is what we can control.

We can not control the price of new and used cars.
We can not control the economy.

We can control our budget and spending habits
We can control our earning power through job performance.
We can control our job prospects and earning power through education and experience.
We can relocate to where jobs are more plentiful and pay better.
We can seek promotions and even new job oppprtunities.
Many of these will require sacrafices

America is a land of opportunity but many times that opportunity requires long hard work, sacrafices and prolonged periods of delayed gratification to reach our end goals. For most of us it is difficult. Many people are now risking their lives and even breaking the law to enter our country and get the opportunities we take for granted

It requires hard work and planning and probably some good fortune to be financially stable. It is not easy and I would never imply that it is but I do think it is attainable.

Sometimes it is better to focus on things one can control and go about the buisness of taking self responibility to make those things we can control better rather than dwelling on things we can never really personally affect.

 

Yes I like Edmund's TCO calculator. But the point was this: If you buy a car that costs you $40K and you have no down payment so monthly payments are $800 or more per month, then only when you trade it in after paying it off, it it's worth 50% you can now go get a new one and pay half of what you were because your loan will be half.

 

I don't think it's obtainable. You may get a certain level of stability, maybe for all your life, but there is no such thing as financial security. There are more important things than what money can buy. I know a lot of people who work 14 hours a day 7 days a week. I don't think they are very happy people inspite they own a lot more than I do.

 

Yeah, that's true. I have been using the same ~$20K car fund over and over for the last 5 cars purchased. Each time I trade in or sell and make a new purchase, I used about the same amount. But even if I had to start with no money down, the result would not be so different. I just would have paid anywhere from 2% to 5% annual interest with a ~$20K loan. That would be $400 to $1000/yr or $33 to $83/mo more on the cost. I would have been still in the black for the previous PP and certainly in black for the current PP. If Toyota/Subaru did not have the hub bolt problem on their BEVs and the Inflation Reduction Act was not enacted, then I would have sold my PP and would be driving an all-electric Solterra now without putting up any more new money into the car cost. But now that plan is washed, I have to keep driving my PP a bit longer until I find an affordable BEV to replace it.

 

Of the cars I mentioned earlier the Prius Prime has the lowest 5-year TCO according to Edmunds at $28,805. I couldn't find any info on a VW Jetta or on a Tesla on Edmunds TCO.

 

Tesla Model 3 RWD 5-Year Cost Of Ownership Versus Toyota Camry
With the price increases a tesla model 3 sr+ would cost about $9K more in TCO over 5 years. The biggest difference is going to be depreciation but that is hard to predict. My almost 4 year old tesla model 3 hasn't really depreciated so its tco over the time period has been lower than my gen 3 prius was during the time. I would expect when these used car prices return to more normal that depreciation will indeed be higher and tco of currently priced tesla's may be worse.

Lowest tco is going to be buying a used corolla or civic, but a new prime is a nicer car. ;-)

 

"Going to be" is the key. Right now, a 5 year old Corolla or Civic costs as much as a new one.

So about $45,000. Ouch! That's a lot of money!

I don't see how Tesla can be taken seriously. They seem more like an enthusiast's car more than anything else. Tell me one reason why I should buy one, that is, if I had the money to buy one. The only thing I can see that Tesla has that I like is they seat people and go places. Other than that, I don't see the appeal, personally.

 

I can only list my reasons, not just one:

• Autopilot - paid $2,000 in 2019 before it became a standard feature. At age 69, I knew my increasing age would come with slower reaction times, arthritis joints, eye deterioration so I wanted computer assistance for driving. I'm now 72 years old.
• Lowest cost per mile - the high efficiency drivetrain and low cost of electricity meant the cheapest cost per mile. Today, it is $0.12/kWh and +4 miles/kWh BEFORE including free charging at merchants who want EV owning, customers. Even on the highway, I'm running under $9/100 miles. Compared to gas or diesel, my Tesla is about 1/3 the cost per mile.

Bob Wilson

 

Those can be good reasons for some people. For me I don't think they'd help all that much. It would take an awful long time, even at 17,500 miles per year, to make up for the initial cost. I don't know enough about Autopilot to know if it would do anything useful for the type of area I live and drive in. I didn't realize it was now a standard feature.

Then there's all the downsides.

• RWD in this snowy, icy part of the country where pointing your drive wheels can come in handy.
• 100A service on place I rent that would quite likely require a major upgrade and added cost that the landlord would not pay and I could lose if I ever moved just for L2 charging.
• Still sparse charging infrastructure.

 

Used car prices are insane, but that old corolla or civic is cheaper here. The market sucks.

Probably $40K with your mileage, but its highly speculative how much depreciation there will be. A BMW 3 series with your milelage would cost of $50+K with higher maintenance and fuel costs than the tesla. As I had much less than expected depreciation, but I would not expect that today.

I don't think anyone should be telling you to buy a tesla if you don't want one. I had a Lexus GS before the prius. I had bought it 2 years old, but even then its TCO was higher than my tesla which I like better. The car handles better, and the power is so much better than in that low mpg V8 in the Lexus. I am a technology enthusiast, and really wanted to see what the autopilot would do and how it would improve. It has improved greatly over the years but has a way to go. I like the minimalist design. They need to fix the spotify ap which sometimes freezes and I have to stream music from my phone instead, but everything else works great.

My gf was interested in an accura integra because of the hype. We test drove one. The dealer had only one and had added $8,000 of crap that probably cost them $1500 to make a huge profit. Over $40K and the thing didn't really drive that well or have the quality materials. There is definitely a large market for tesla's but there are other cars. I expect over the next 5 years tesla will face some competition and will drop their prices. They may raise them again next year as they will qualify for $7500 in federal tax credits, and some of the competition will not. That is a change versus today with no tax credits for tesla and credits for its foreign made competitors.

 

That comes across as a blanket statement. Perhaps rephrasing it to something like "I don't see why I should seriously consider a Tesla" would be closer to your meaning??

There is a difference between selling car's to enthusiasts and making enthusiasts out of most people that buy your car.

I can't, it is a personal choice.
As Bob said, I can tell you my reasons for buying them in the past, and reasons I have heard from other owners.
I can also offer to clear up misconceptions or answer questions about my ownership with Tesla's.

Some of the reasons others buy a Tesla.

• Their kid's future.
• Their own future.
• The performance.
• The convenience.
• American made.
• American company.

These may or may not be valid reasons for you, they are just reasons I have, or have heard from other owners.

 

If I'm driving more than average (17,500 miles per year) how would that lower the 5 year total cost of ownership? Wouldn't it increase it?

Fair enough. I am the kind of guy that would benefit from owning a minivan but realize that with my income and current car market if my Avalon got totaled tomorrow at best I could afford a Corolla, and with the shortages and delays going on I probably wouldn't even get to have that level of luxury. Talking about Teslas and Lexuses and BMWs is like asking if I'd like a purchase private Yacht.

Let's hope prices come down, or wages up, or both, or if rent would stop doubling and tripling.

I think of myself as a technology enthusiast, but maybe in a different way. I'd like to learn and get my head wrapped around more about the fine details of how EV's work and the differences between them. Not just raw numbers like 0 to 60 times or miles per kWh, or general electric motor and battery theory, but how many poles and windings do the motors have? What kind of alloys are they using? How fine is the pulse width modulation? Back when EV's were only DYI projects there was a wealth of information on the advantages and disadvantages of wye vs. delta windings, the differences in numbers of stator vs. rotor poles and windings, the thicknesses and materials of the stator and rotor laminations, etc. But I haven't found any of that info out about any EV out there. Why? Maybe I need to look more.

When you mentioned your Lexus had a V8 I automatically thought to myself "is it a cross-plane or flat-plane crank V8?"

More like "I don't see how most people could seriously consider buying a Tesla."

They are nice cars. But price to practicality is more than what I could justify. And I think there's a lot of people who would agree with me right now.

I walk to work from my home and back. It's about a 30 minute walk one way. I think that's all I can do right now. At best I might be able to get a used Bolt after I finish paying off the Avalon, but am still afraid it won't work out.

 

I think the tesla batteries lose energy with years and heat more than miles so it wouldn't affect your depreciation much. I increased it. The link I gave had lower miles and $37,800. I don't pay much for electricity that will affect it a little. Depreciation is the big factor on the more expensive car. I hope like you prices come down. Tesla is plowing the excess profits into expanding manufacturing. That will bring its costs down, but only competition will change the selling price.

The first car I bought was a used corolla. I know its a different market. I'm kind of shocked that some people I know that don't make that much are driving $50K new pick up trucks.

Wages are going up because of the labor shortage but not as much as inflation. I thought my mortgage and property taxes were bad as rent was much cheaper when I bought, now in my city its getting that people keep having to move farther from work to get affordable rent.

My model 3/Y's rear motor is a 6 pole switched reluctance design. If its dual motor the front motor is an induction motor that can free spin if not excited. The switched reluctance is more efficient but the permanent magnets mean it can't free spin.

More impressive than the 0-60 time is just how perfect the acceleration is. This is thanks to the electronics that know about the ripple currents and combat them. Most braking is regen simply by lifting off the accelerator. Because tesla doesn't do the that partial regen on the brake then physical braking, the brake pedal is very linear like a non hybrid, you simply don't use it that often.

 

I don't either. I made about $38,600 before taxes this year. I'm promised a 7% raise for next year. But going off of this and past years which were about the same I've been spending about 17% of my after-taxes-earning on the car. That's $70 for insurance (I was paying over $100 more actually, but now pay only $70), about $100 in fuel, $186 on car payment and $120 on everything else including saving for future tires. The most I would spend on transportation is 20% of my income, or about $550 right now. If the Avalon were paid off and I traded it in then my payments on a $50,000 vehicle would be just over $550 for a 7 year loan. I wouldn't have any money for insurance, fuel or any maintenance whatsoever.

 

Depreciation and resale don’t matter for ownership costs because they don’t apply until after the ownership period is done. Realistic ownership costs take into account what a car owner is paying while that person owns the car. You don’t get a monthly discount just because eventually you’ll sell the car. The costs that truly matter are either total purchase price or total cumulative monthly payments, repairs, maintenance, fuel, insurance, and government taxes and fees.

At any rate, I plan to drive my Prius into the ground. By the time I’m done with it, it’s not going to be worth anything! haha

 

Ya, I think I may do the same with the Avalon.

Depreciation and resale can be helpful when comparing two vehicles that cost the same up front. If both are $30,000, or whatever, and both get the same fuel mileage, but one will lose more value over the years, then it's probably better to go with the one that doesn't lose as much value. Also, the ones that don't lose as much value are also usually the ones that last longer. Your Prius may go for 300,000 or 400,000 miles before it no longer makes sense to keep on the road.

 

Respectfully, I disagree. Like you, I use to think the monthly budget for the car is the only thing that mattered. But after purchasing my first PP, I realized that there is more to it than just the price of the car to figure out the true cost of owning and operating a car. A car is an asset, it holds monetary value just like a house or any other property. This value changes over time. For a car, it usually only depreciates, but the rate is different depending on the car and in a very unusual economic situation like today, the value can actually go up. If you are buying a car and never going to sell it and run it to the ground, or if you are always leasing a car never buying it, then depreciation and resale value do not play a role in calculating the TCO. But many people do change cars. And I have learned that with the three PPs I purchased in the last 5 years, how much it depreciated and what resale value it held are just as important numbers as the purchasing price in calculating the overall cost.

The monthly cost I posted in my comment #191 is calculated based on (either total purchase price or total cumulative monthly payments)+ (repairs)+(maintenance)+(fuel)+(insurance)+(government taxes and fees) minus (trade-in or resale value). For simplicity, I did not post entire spreadsheet columns on the previous comment. Below you will find the breakdown of the cost for each category for the three new PPs I purchased and in comparison one used HCH I owned.

The depreciation and resale value of the car determine what the car is sold or traded in or what the insurance payout is going to be. The column under "Price Sold" is this number. For note, the number for the HCH is the amount of insurance payout after an accident declaring the car to be totaled. I actually bought the car back and repaired it and drove for a few more years. But in the end, it was totaled for the second time without any cash value left. Also, the monthly cost for the 2021 PP I currently own is based on the valuation of the car as of 6/1/2022 which was a $30K trade-in value if I have sold it then. However, I checked it now and found out that the value of my car is currently $34K from CarMax, making it an even better number if I sell it now.

As you can see, if your car has a value at the end of the ownership and you get paid for it when you discontinue owning the car, it makes a huge impact on the overall average cost of ownership for the life of the car. A $16K used HCH driven 83 months and totaled twice ended up costing me $344/mo while a $19K brand new 2020 PP driven only 10 months and sold for $22.4K ended up giving me money back at an average of $161/mo even after all the other cost has been subtracted. No, it was not a monthly discount, but at the end of the ownership, that money was mine to keep.

 

I understand what you’re saying, and obviously it’s great that you’ve been able to sell cars for more than you paid for them. My last car was totaled and I got 5 grand as an insurance payout for it, which I used to partially pay for my current car. So functionally, I think of that as applying more to this vehicle’s cost of ownership than the last one since it affected how much money I had to pay for the car I have now. I know that number was derived by the depreciation of my previous car, and paying attention to depreciation can be functionally useful when determining insurance coverage and if collision and comprehensive coverage are worth having in comparison to the premiums being paid. But in general, how much money I could sell my car for does not seem relevant except in light of a different car that I would want to buy.

So again, I get it. I just have a different perspective.

 

Yep, right there, the depreciation and resale value of your previously owned but totaled car played a role in calculating the TCO of the car, but not the car you purchased next. You are correct in that the money proceeds from the insurance payout were used for the purchase of your next car. But the amount of the check you received from your insurance company has nothing to do with the next car you were buying. It was the inherent value of the car totaled.

If your totaled car had more value at the end, then your TCO would have been lower. The thing is that predicting the depreciation and resale value of a car is difficult if not outright impossible as is the prediction for the future cost of repairs. And what price of a car, tax, insurance, and fuel cost one pays for the same model of the car varies vastly by owner. Even for my own cars, depending on what time period I owned the car would change the cost of fuel widely. So, I don't pay much attention to TCO analyses done by others. For my own cases, I record what I actually spent on the car and what I get out of it at the end, which gives me the real historical TCO of the car I have owned. And I try to aim for a $300/mo average cost of owning and operating a car. It is hard since as mentioned in one of the videos linked above, the average US car owners spend $773/mo on owning and operating a car. I certainly have had a car that I ended up spending that much or more. But with lower depreciation thus higher resale value in addition to a very low initial purchase price and very low maintenance cost makes car ownership into an equitable investment sometimes.