Entry Level 40kWh Tesla Model S Cancelled, 60 kWh Cars All Get Supercharging Hardware

1 year ago by Jay Cole 28

40 kWh Reservation Holders Will Receive 60 kWh Cars With Software Limited Range

40 kWh Reservation Holders Will Receive 60 kWh Cars With Software Limited Range

While Tesla was announcing that not only was the company profitable in the first quarter, and that it was unexpectedly producing cars at a higher than expected rate (more than 4,750 electric sedans in Q1), they also dropped a bit of a bombshell.

There will never be a 40 kWh, entry level Model S produced.  And no, this is not an April Fool’s joke on us by Tesla.

Tesla small battery option for the Model S will not enter production, due to lack of demand.

“Only four percent of customers chose the 40 kWh battery pack, which is not enough to justify production of that version.  Customers are voting with their wallet that they want a car that gives them the freedom to travel long distances when needed.”

Where does that leave an estimated 1,000 reservation holders for the $59,900 entry level sedan?  Tesla says that they will simply be upgraded to the 60 kWh pack…but with one small hitch:

“The customers who ordered this option will instead receive the 60 kWh pack, but range will be software limited to 40 kWh.  It will still have the improved acceleration and top speed of the bigger pack, so will be a better product than originally ordered, and can be upgraded to the range of the 60 kWh upon request by the original or a future owner.”

All Tesla Model S Sendans Are Now Built With Supercharging Hardware Inside...A Calculated Risk By The Company

All Tesla Model S Sedans Are Now Built With Supercharging Hardware Inside

This move, echos a earlier decision to not offer then 40 kWh version in Europe, and while it likely distressed those of us who someday hoped to maybe squeeze a Model S into our budgets, from a future profitability stand-point for the company itself, having only the 60 kWh version (which starts at $69,900) and the 85 kWh version (from $79,900) is a sound business decision.

Separately, due to the cost of the manufacturing process, Tesla also said that all 60 kWh Model S sedans will (and have been) built with the Supercharger hardware included.

“Tesla is taking a slight cost risk that ultimately all customers will want to buy the Supercharger upgrade and receive unlimited, free long distance travel for life.  Even for those that never drive long distances, this will improve the resale value of their car to people that do.

So, while a Model S could be had for $57,400 a little over 3 months ago, it now costs $69,900.  The question now becomes, can Tesla sustain the pace to sell 20,000 cars per year without the trade-up story to sell?

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28 responses to "Entry Level 40kWh Tesla Model S Cancelled, 60 kWh Cars All Get Supercharging Hardware"

  1. Brian Smith says:

    Surely this is an April Fool’s gag!?

    1. Jay Cole says:

      Sorry Brian, it is not…we probably should have put that disclaimer in the story (will do now actually).

      April Fool’s gags really aren’t our thing, (=

  2. hacker says:

    Quick! let me put in my 40kWh reservation now…

    1. kdawg says:

      I notice they haven’t updated their webpage

      http://www.teslamotors.com/models/options

  3. Dave K. says:

    This is really unfortunate, I think most of us really never need more than 40kwhrs. I religiously reset my odometer for an entire year and found that I only drove over 100 miles (excluding a couple of roat trips) one time, could have swapped cars with my wife for that one. Of course Tesla can just design their Bluestar entry level car to fill the 125 mile range segment, maybe this will speed that up.
    If it helps Tesla make it then good!

    1. SuperG says:

      Unfortunately, Elon tweeted last week that the low end car was still 3-4 years away.

      1. kdawg says:

        And by then GM will probably have it’s purpose built BEV in the works (along with a few others).

      2. dick tracy says:

        by then we will be on to better technology, hydrogen baby.

  4. GeorgeS says:

    Hmm.
    I don’t know how to react on this.

  5. kdawg says:

    I wonder how easy it its to hack the car to use the full 60kWh? Or what it costs to have Tesla change the code ($12,000)?

  6. GeorgeS says:

    I’m surprised only 4% ordered 40 kwh.

    1. Jay Cole says:

      It was estimated at a little under 10%, but the price jump, the long (oft delayed) wait times, along with the non-US reservations (about 7,000 units) that did not have the ability to book at 40 kWh, pushed it lowered.

      Very much a perspective thing.

      If you are looking at it from remaining US orders on the books, Tesla has around 11,000-12,000 orders remaining to fill worldwide, of which about 7,000 are outside US/Canada (who didn’t have the 40 kWh option to choose from). Of the 5,000-odd North American orders still remaining to be filled, we figure 20% of them were 40 kWh.

      40 kWh sales were constructively kept as low as possible. That being said, the financial numbers for Tesla I don’t think were ever there on the 40 kWh. If you want tTesla to be profitable, and be around for a long time, this was the right move.

  7. Josh says:

    This is the smart move by Tesla. I am looking forward to tomorrow’s announcement. My guess is 120 kWh battery option to go along with the new 120 kW SuperCharging hardware, but maybe not available until Model X.

    All the 40 kWh reservationists should be thrilled, they will have instantly better resale value and if they keep it the batter will last forever with 33% battery fatigue buffer. The 40 kWh Model S might be a real collectors item, since over time people will have forgotten that they offered a battery “so small”.

    1. Anthony says:

      120kWh battery would need some new batteries. The 3400mah Panasonic cell would only get it to 93kWh. To get to 120kWh without meaningfully increasing the number of batteries it takes per unit, it would take a 4.4Ah 3.4V battery, which hasn’t been produced (this battery would likely show up in 2014, the next version after the 4.0Ah 3.4V battery expected in 2013).

  8. bloggin says:

    It sounds like they are saving the 40 kWh battery for their smaller lower priced sedan. Buying and EV, like buying a computer, is all about getting the most powerful processor/battery you can afford in the machine you want.

    The Supercharger hardware is a big thing. Because now having duel 10kw onboard chargers is standard, which enables 62 EV miles of charge per hour with a 240w charger.

    That’s about 1 mile per minute charging.

    1. Aredd says:

      Nope that is not true because the twin (dual) charger is a seperate add on from the supercharger hardware. However, one can add the second charger for. 3500 if they really want it and didn’t order it initially.

  9. offib says:

    Why did Tesla even have to reveal this today? Back in October 2011 when the Model S was shown, everyone, including myself and people I know were gobsmacked that you can have that at $50K. That price has gotten all the attention first, and maybe buyers would’ve gotten greedy or whatever when they say the 60kW and 85kW. The Model S holds in my opinion a resemblance how far Tesla has gone from its Roadster, its base price especially that is half that of the Roadster’s.

    I’m guessing Elon never expected that more people preferred to buy the more expensive electric car while many still today moan and repeat that EVs are too expensive.
    The $50K car was Elon’s second step for Tesla Motors. Make an expensive $100K, low production but famous car. Then make a more mainstream, large sedan at $50K, then the 3rd step will be a $30K or less car for the masses.

  10. evnow says:

    Wow – if only I had reserved a 40 kWh Model S, I could have got supercharging !

    1. evnow says:

      I just reserved a 40 kWh model S, we will see what happens.

      1. Jay Cole says:

        You serious evnow? I would be really interested to see how that plays out for you. I thought you and I were waiting on the BMW i3/Inifinti LE, heeh

        1. evnow says:

          My first option was Model S 40 kWh – but dropped it because of lack of quick charging. So, we would go with this only if they would allow me to add the supercharger option without upgrading to 60 kWh.

          I think i3 w/Rex is still a possibility (even if we get S), if my wife likes it, instead of say Outlander PHEV.

      2. Dave R says:

        This PR is all a sham to get 40 kWh car reservations up. Once that happens, they’ll go back to producing 40 kWh cars as expected. ;-)

        For your sake, I hope they don’t. I myself am tempted to get a 40 kWh Model S for the same reason!

        1. evnow says:

          Well, the other problems with S (too big !) still exist. So, I won’t shed any tears if this doesn’t go through (or they say I reserved after the announcement, so no deal).

  11. Priusmaniac says:

    It is a bit to bad because the 40 KWh model would have been a perfect base for a micro range extender version. Perhaps not something in the pure eV line but something the mass market would call in the millions. Decent everyday EV range and a small cheap range extender that allow going further on bioethanol. All of it at a lower cost.

  12. KeiJidosha says:

    Would Tesla paying off their DoE loan early let them cancel the Bluestar?

    1. David Murray says:

      let them cancel it? I’ve never heard that it was required they produce it to qualify for the loan. I actually think Tesla needs the bluestar to survive long-term. I think the number of people willing to plop down $80,000 to $100,000 per vehicle is a limited market. After all, you are competing with lamborghinis and ferraries at those prices. They need to get down under $50,000 just so they can compete in the traditional luxury car market and definitely need to be under $30,000 to get any mainstream adoption. Another serious concern is that other manufacturers will be catching up to Tesla in the coming years. Just like Apple released the iPhone and iPad to a brand new market, they were able to charge whatever they wanted. But eventually they had to start competing with other companies as they caught up.

  13. Ed Cheung says:

    OUCH!!! I just canceled my 40kW reservation and got my deposit back last week. Was going to change to a LEAF. I wish they would have told me this. Would have kept my reservation.

  14. derp says:

    “OUCH!!! I just canceled my 40kW reservation and got my deposit back last week. Was going to change to a LEAF. I wish they would have told me this. Would have kept my reservation.”

    I knew someone who played the same 5 numbers every day for years. His numbers came up a few weeks after he switched.