The Tesla Model 3: crunching the numbers

What you'll save on petrol, what you'll spend on servicing - and what's the deal with replacing the batteries?

What’s holding back the electric car?

Hundreds of Australians lined up outside Tesla stores last week, ready to place a $1500 deposit on the latest addition to the range, the Model 3 – a car they hadn't even seen. Some blindly ordered the car because they have faith Tesla will show them what they want. Others want to be early adopters of the first electric car designed for the masses to reach Australia.

Tesla revealed the Model 3 more than a day later, on Friday 1 April. Unlike the Model S, which has a prohibitive starting price of around $130,000, the third generation Tesla will be much more affordable; reports suggest the local price will be around $60,000. Within less than 24 hours, more than 180,000 orders had been placed globally, according to Elon Musk, the company's chief executive and founder.

Many will justify paying a little more for a Model 3 because buying an electric car eliminates the cost of petrol. The base variant is expected to hold charge for 346 kilometres and accelerate to 100km in less than six seconds. But will the maths hold up?

No petrol? How much will I save?

Lining the underside of the Model 3 is a floor filled with batteries. Driving 346km off a single charge is possible – theoretically. But in the real world, with human error and variables such as wind speeds, the practical range is expected to be less.

Tesla has remained tight lipped on the details of the Model 3. Without knowing the specifics, any estimates of its running cost will be vague. A closer look at its sibling, the Tesla Model S, can provide some insight into how much money an electric vehicle can save.

The Tesla calculator can be used to figure out how much it will cost to top up a charging Tesla. The data it asks for includes your hourly cost of electricity, the distance travelled per day and what kind of outlet is used.

CHOICE surveyed Australian energy resellers in August 2015 and found the average price of electricity to be 25 cents per kilowatt-hour (kWh), while research conducted by the Australian Bureau of Statistics reveals the average Australian drives 40km per day.

When the battery of a Tesla is replenished, the charge is switched off so that only what is needed is used. Topping up the charge of a Model S, then, would take 51 minutes and use 8.3kWh for a cost of $2.06 a night.

Separating Tesla from every other car brand is its network of Supercharger stations. These charging stations can replenish 80% of a Tesla's charge in 40 minutes. Supercharger stations are free, and owners will likely make use of them once per week, when possible.

For example, let's say an owner tops up their car at home six nights a week and makes use of a Supercharger station on the seventh. This would cost $12.36 a week for up to 280km of driving, or over a year, $642.72 for more than 14,500km. Households with solar panels will likely pay less.

The Tesla Model 3 is comparable to Audi's similarly sized A4 sedan. The 2.0 TFSI variant uses 7.5L of petrol for every hundred kilometres travelled – a figure calculated based on the car's performance in Audi's testing facilities. NRMA's most recent petrol report cites an average cost of 109.9 cents per litre. Driving 280km a week in the Audi would cost $23.08, or $1200.11 over a year.

So the switch to the electric Model S represents a 46% saving of $557.40 a year. This provides some context on the kind of savings we can expect from its mass produced sibling, the Model 3.

Competitive servicing – until the battery needs replacing

Contrary to popular belief, servicing an electric vehicle is not cheaper than a petrol alternative. Pricing is best described as competitive – even though electric vehicles do not have a mechanical engine – right up until the batteries powering them need to be replaced.

Let's compare the servicing plans for a new Audi A4, a BMW 3 series and a Tesla Model S.

  • The Audi plan is priced at $1620, covering three years or a distance of 45,000km, for a yearly average cost of $540.
  • The BMW basic plan is priced at $1340, covering five years or a distance of 80,000km, for a yearly average cost of $268.
  • The Tesla plan is priced at $1525, covering a distance of 60,000km, for a yearly cost of $508.

Replacement costs for lithium ion batteries in an electric car raise concerns on account of high pricing and a short lifespan. Any smartphone user will notice that the performance of their phone's battery will deplete over time; the same degradation is anticipated in the batteries powering Tesla's cars. A loss of 30% could be expected after ten years of inefficient use, said Heath Walker, the head of marketing and communications of Tesla Australia.

Tesla Australia has never confirmed how much it will cost to replace a degrading battery pack. However, Tesla's global website estimates replacing a Model S 85's battery to be $US12,000 ($AU15,799). The company is banking on the cost depreciating within eight years, which is when the warranty provided for the batteries expires. Helping drive this cost down will be its Gigafactory, a manufacturing plant that, when it reaches full capacity by 2020, will purportedly produce more lithium ion batteries in a year than the world managed to produce in all of 2013.

Calculating the cost of replacing a Model 3's battery is difficult because Tesla has not disclosed the capacities of its batteries. Batteries will remain an expensive component to replace, even after a price drop. Losing battery life might not be a bother for the people who buy a Tesla brand new, just as a smartphone's degrading battery is tolerable, but it will likely affect the car's resale value.

The pitfalls of buying an electric car today

Making the electric car cheaper is not enough to spur widespread adoption. Where will we charge them when the battery indicator turns a daunting red and we're far from home? Petrol stations are ubiquitous, but charging stations are few and far between.

The number of Tesla Supercharger stations worldwide is expected to double by the end of 2017; Tesla's charging infrastructure is considerably more fleshed out in North America, Europe and parts of Asia. By the time the first Model 3 rolls off production lines, the number of superchargers is expected to double to 7200.

Only eight Tesla Supercharger stations are in all of Australia, however. They have been "strategically placed" between Melbourne and Port Macquarie, NSW. Three additional Supercharger stations will be built in an effort to connect the network to Brisbane, QLD, confirmed Walker.

There are "destination chargers" scattered throughout most Australian states. These chargers, which are the same as those installed in the homes of owners, can be found at popular venues, such as shopping centres, hotels and car parks. Tesla owners get a place to park their car, but leaving it on charge for a full hour adds only 40km.

And that's the other cost of owning a Tesla. Unlike a car powered by petrol, which is topped up in less than five minutes, an electric car consumes time. Road trips need to be coordinated around the existing infrastructure, otherwise owners may have to loiter and linger near a charging station. Many owners bond about their shared passion for their cars, the electric car movement and the modest role they play in enabling a sustainable future. But there will be times where all they will want is to go home.

I'm still keen – how much, and when will I get it?

Specific pricing and availability details remain obscure in Australia. Representatives from the company cite the car's US price of $35,000, but won't reveal the local pricing on account of the fluctuations in the Australian dollar. The Model 3 will be released first in America by 2017, followed by Europe, Asia and then Australia, confirmed Walker. No firm date has been provided, but it is widely believed we could be as much as two years behind.

The years leading to the Model 3's launch will be critical. Increased support for the Supercharger network will play a large role in determining if the electric car is ready for the unique nature of Australia's landscape, but affordable pricing and lower battery replacement costs will make them more attractive. Then there's a need for more Tesla stores and servicing centres.

The first mass produced electric car available in Australia is coming, but it won't be welcomed by the masses without Tesla's local support.

Leave a comment

Display comments