6 Aug 19

Tesla offers free Supercharging on Model S and X again

Rather than giving discounts to crank up sales of certain models, Tesla prefers (temporary) offers like free Supercharging. It was a strong USP for the Model S when it was launched in 2012, but Tesla suddenly limited it to a certain amount of kWh (400 per year), only to release the cap again a bit later and then finally doing away with the programme entirely.

Now that the Model 3 is cannibalising its bigger brother, the Model S, Tesla needs to do something to keep its flagship limousine commercially alive. That something is indeed the reintroduction of free Supercharging on all markets, both on stock vehicles and custom orders, and not only on the S but also on the X.

Big advantage

What does that mean in terms of financial benefits? It all depends on where you live, how you drive and how much you drive, really. The Supercharger rate Tesla applies differs across Europe, but €0.23 per kWh (excluding VAT) seems to be the average. If you drive responsibly and hardly use motorways, you can average 18kWh/100km. With a yearly mileage of 15,000km, your advantage is about €620 per annum.

Heavy motorway users who travel 35,000km per year and use 25kWh/100km on average will see the yearly advange increase to over €2,000. Does that make the Model S cheaper - or at least not more expensive - from a TCO (Total Cost of Ownership) point of view than a Model 3?

The answer is no, alas. Even if you compare the most expensive Model 3, the Performance AWD, with the cheapest Model S, i.e. the Long Range AWD, there is still a €20,000 price gap excluding VAT. At a theoretical equal residual value percentage and assuming a similar 'fuel' efficiency, tyre cost and service and repair budget, you need to drive at least 350,000km before the free Supercharging makes the Model S a possibly cheaper option.

That's also assuming you would only use Superchargers to top up the batteries, which is very unlikely: most people charge at home or at the office at regular (paying) chargers.

Not transferrable

The situation would have been different with the less expensive Model S 75D, but Tesla removed this entry-level model from the price list recently. Given today's free Supercharging deal, that now makes sense. On the other hand, Audi just announced the addition of a 70kWh base model in its e-tron line-up. We wouldn't be surprised if Jaguar would do the same for the i-Pace, especially now the Mercedes EQC is entering the scene.

That being written, Tesla boasts relatively strong residual values today, helped by a low supply and a strong demand. To maintain its RV advantage, not many things would be better than making the free Supercharging transferrable from the first to the second owner - perhaps with a limit in time and mileage for the latter. Tesla has decided differently, maybe because they don't want to focus on the used car business, maybe because they believe residual values will stay strong anyway. With new competitors looming at the horizon, they may have to reconsider in the coming years.

Authored by: Dieter Quartier