Tesla Model 3 Sets The Price of Driving Green: $35,000

1 year ago by Joe Bonham 53

Tesla CEO Elon Musk Introduces The Every Man's EV

Tesla CEO Elon Musk Introduces The Every Man’s EV

Tesla has just unveiled the Model 3. At 215+ miles of range, in two years it will be the cheapest practical electric vehicle (EV) on the market. The Chevy Bolt will come out sooner, but cost slightly more before incentives. The price of an EV continues to drop, but that does not mean it is cheap.

Tesla Model 3 - Arriving In Late 2017

Tesla Model 3 – Arriving In Late 2017

How accessible is $35,000?

Kelly Blue Book finds that the average price paid for a compact sedan is $20,000 while for a mid-sized sedan we average paying $25,000. That puts a Model 3 at least $10K to $15K more than we tend to spend right now. (For argument’s sake, we’ll set aside the $7,500 Federal credit as that is a limited rebate, and given the volume of Model 3 demand, may not be available much after the car’s debut)

That is anywhere from $181 – $271 more per month for 60 months. Is it worth it?

Tesla, like Apple, is good at creating desire and need. Anyone who can already afford to purchase a new car and pay ~$200/month in gas, no doubt will be wooed by the math.

Tesla is really targeting the consumer that already buys performance vehicles, like a BMW 3 series ($33K – $43K MSRP). There is no reason why Tesla would not capture this market share, and it will have an impact on society. Not all at once. It is mustard seed logic, not shock and awe.

The mistake our skeptism makes is in asking for a cheap electric car (<$20K) that slowly gets better and better, and never succeeds. Tesla’s wisdom is in not listening to our logic. They are making a great electric car that everyone wants, that starts expensive, and slowly becomes cheaper and cheaper.

Tesla Model 3 Reaches Higher

Tesla Model 3 Reaches Higher

In the reveal of the Model 3, Elon Musk, CEO of Tesla, talked about a three stage plan to get to the model three, an affordable EV. Comments on EV blogs and forums are already musing about the need for a model IV, a truly elusive and affordable unicorn. I don’t think this is in the cards anytime soon, and Tesla’s success doesn’t depend on it.

Households that don’t buy new cars, but see the value in an EV and take the plunge will just be added gravy. And then after this, used Model 3s will be available too, if anyone will part with them.

Editor’s Note:  Besides occasionally writing at InsideEVs, Jon is the Electric Car contributor for Creative Green Living

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53 responses to "Tesla Model 3 Sets The Price of Driving Green: $35,000"

  1. Thomassen says:

    And in 2020 Tesla should release the Model C (city), base model 20k. In beteeen the Model Y, new Roadster, Model S facelift and new larger battery replacements for S and X.

    1. evcarnut says:

      Sounds Like a VW …YUK ka Ka ! Tesla Are 0riginaters “N0T IMITATERS”

    2. Kacey Green says:

      the truck should come either right before or right after the new roadster, an electric pickup with 120/240 output (like VIA Trucks) would be a hit

    3. jerryd says:

      Tesla is already making $10k EV’s, it’s called used Leaf’s, Volts.
      Also the Bolt, T3 will drive down 80 mile EV costs to under $20k.
      The T3 will drive down the Bolt’s price $5k at least when it comes out because well it’s a bigger, better car with the SC
      system and Tesla’s high resale value.
      Tesla is the only reason most of the other EV’s are coming out as hard for them to say EVs are bad when the best car in the world is an EV.
      But most important is Tesla has driven the price of batteries down
      Likely Tesla 3’s new battery will be around 12 lbs/kwhr too which is how they make them cheaper.
      And in 10 yrs they is little stopping lithium from going to $60/kwhr and 8 lbs/kwhr at which time any kind of ICE car, truck, even semi is going to be hard to justify.

  2. Spec says:

    Is it worth it? 235,000 people said “Yes!”.

    1. notting says:

      Well, they can still change their opinion, e.g. Model S or refund + buy a Bolt, especially when they’re not in Tesla prefered groups of customers (especially completely new customers will have to wait)…

      Maybe there’re some people who only want to sell it for a higher price because there’re like always people who would pay more to get something faster or something that’s officially sold out…

      notting

      1. evcarnut says:

        REGARDLESS

  3. evcarnut says:

    is the order count Up?

    1. Rich says:

      232k was around 1am EST this morning. I’m sure it’s up by now.

      1. evcarnut says:

        Once they start they won’t keep up…this is Tooo good! & Looks Better Every time & the more, I see it!

  4. notting says:

    I would pay a few kEUR more so the car doesn’t suffer from a bad service network (like Tesla – Ranger flat for maintenance doesn’t exist anymore, so I costs at least 100EUR each time – usually more because >100km away and 1EUR/km…). E.g. the service network for Renault Z.E. maintenance is very good (_every_ Renault contract garage) and even for special Z.E. repairs I don’t have to drive much more than an hour in worse case (at least in my region).

    So I’m waiting for a Megane Z.E. with at least such a range (and a battery to _buy_ etc.).
    Or maybe Opel sells the Bolt?

    notting

    1. TomArt says:

      Well, Musk said that they are dramatically expanding the number of their stores and service centers globally by the end of 2017. Also, in some cases, the stores and service centers are all in the same facility.

      Besides, it’s not like the ever stopped building more stores and service centers – it’s been a continuous, ongoing process, as has the SC network expansion.

  5. ffbj says:

    I think this is the car for the masses too.
    Next would be a roadster refresh which they said they would do, and possibly a truck, or their mini suv, but those are years away.
    Even further now with years of production demand for the the Model III.

    So no 20k Tesla, ever, would be my estimation.

    1. Nom de Plume says:

      I also think the sub-$20k car will come from someone else. China perhaps?

      Which is fine. Tesla doesn’t need to make every car in the world. They just need to keep pushing the other manufacturers.

      1. TomArt says:

        Interesting point.

      2. evcarnut says:

        Yea, Because The BIG car makers Need to get Kicked In the *SS by the Jolly Green Giant to get them 0ff their butts & out of their comfort zone!.. They are so Stuck on the ICE car & especially the Trucks’ BIG $$ Profits, They figure why change it , when the Big money keeps rolling in!

    2. TomArt says:

      Well, Musk said that he would stay until they got the (now) Model 3 to market and a new Roadster (which most of us assumed would be based on that new, smaller platform). The Roadster was hopefully going to be 2018, but I think it is safe to expect that around 2020 or later.

      Also, for sales purposes, and particularly with that trunk on the prototype 3s, they will need an SUV/CUV/whatever on the 3 platform. The sooner that gets out, the better, IMHO.

      Maybe they will have more resources and be able to release the CUV (Model Y, I guess) and the Model R (new roadster) both in the 2020-2021 timeframe?

    3. JRMW says:

      ffbj,
      I don’t think we can call a Tesla a car for the masses. At best we could say it’s an aspirational car for the masses. So close.

      But I’ve never spent $35,000 for a car, and I suspect many have not.

      Yes I understand that there will be gas savings… But Teslas are in BMW territory, not Honda Civic land.

      I think the Model 3 is the pivotal point in EV history.

      PLEASE keep it simple Tesla.

      This car needs to not only wow on debut, it needs to rock long term as well

      In other words, no doors that get stuck open!

      1. ffbj says:

        I just meant that is the bottom end for Tesla, and aspirational, certainly.

      2. The Closest Car I Ever owned that had performance like the Tesla’s – was my 1983 Mazda RX7 GSL – with aftermarket Arkay Turbo that took the stock 100 Hp up to 205 Hp, and allowed it to push to Redline in ALL 5 Gears!

        Sure it only had 2 seats, and went like a bat out of H*LL, was very comfortable cruising at 125 Mph (200 Kph), but I could also drop it into Cruise Control at 90 Kph / 55 Mph for the mountain Roads in B.C. and get 30 Mpg on a Tank! It hit Redline so fast in First and Second Gear – you had to be ahead of it to shift fast enough!

        THAT car cost me $18,000 plus a 5% Commission as the dealer was selling it ‘on Consignment’ for the owner – so – basically – I got it in 1984 for $19,000 (Canadian)! Inflation adjusted – today that equals $44,363.03 – http://www.dollartimes.com/inflation/inflation.php?amount=19000&year=1984; My Wages at the time – were $12.45 Per Hour – so that adjusted for Inflation to today = $29.06 – http://www.dollartimes.com/inflation/inflation.php?amount=100&year=1984

        Since those were Canadian Dollars and this car is setting the Bar at $35,000 US – At today’s Exchange Rate to Canadian – that = $45,545 – http://usd.fx-exchange.com/cad/35000-exchange-rates.html
        So on those factors alone – and my wages being slightly better that inflation adjusted, ignoring other life expenses – this car is no more expensive than the RX7 was back in 1984! Plus – in that Car – I burned through High Test Premium Fuel (For the Turbo) at the Pump Price of 20% above Regular – $0.60 Per Litre, totaling about $250/Mo in Fuel burn – which today would be inflation adjusted to about $583.72 a month to drive (admittedly I drive way less now than I did then!)

        The Car’s financing was interesting – hot salesman ‘got Me’ into the car with – a $5,000 Finance Company Loan at 29.9% for $210/Mo, and the Balance at a Bank Loan Rate of 14.5% for $460/Mo! (Remember – my Wages were $12.45/Hr!) So today – that would be like an inflation adjusted $490.32/Mo for the Finance Company, PLUS $1,074.05 for the Bank! So – that = $1564.37 in Financing Costs Equivalent today – PLUS the Fuel for a total of $2,148.09/Mo – to drive a car that was competitive with a Porche Ruff 930!

        So – I think this Tesla Model 3 Will be decently competitive in value, and performance, with the car I had then – plus – it comes with 3 extra seats!

        (Oh – wait – there’s More: I was Also paying about $240/Mo for another car I had – a 1981 Chevy Citation with a V6 and a 4 Speed Manual! (Add Another $560.37 to the Mix!)

        1. Joe Bonham says:

          Thanks for the comparison.

  6. Ken says:

    I disagree with the statement, “in two years the model 3 will be the cheapest practical EV on the market”. I wonder if the writer currently drives an electric car or is one of the masses that believes we need 300 mile range and 20 minute recharging for it to be practical. Ive been daily driving various electric cars since 2007. Ive very easily put 25,000 miles a year plus on a Nissan Leaf since 2012. My Leaf has been to 5 neighboring states, towed home 3 tons (2,000 lbs at a time) of wood pellets every winter, and towed my 2 Jetskies to the lake or ocean every weekend in the summer. It’s also been dragraced, autocrossed, road rallied, and driven through plenty of snow. It has made the 65 mile round trip to work faithfully without charging. Matter of fact, my 2012 did not even have a Chademo port. My 2015 Leaf S does have the chademo port and faster charger and makes it even easier to rack up the miles. It will serve me well until 2018 when my Model 3 comes in. Point of my story being, the most practical, affordable EV right now is a Leaf, especially a used one for $8k. So in the meantime, dump that gas guzzler and pick up a used Leaf or iMiEv for two years and enjoy driving electric now. No need to wait for the magical Model 3. I have one on order and can’t wait to put a hitch on it to tow all my toys but in the meantime, the Leaf does the job just fine.

    1. MisterG says:

      Very well said, my 2016 Leaf SV is getting the job done today.

    2. Bill Roman says:

      How do you put a hitch on a leaf?

      1. Ken says:

        I bought a hitch from Torklift Central for my 12 Leaf, 15 Leaf, and 12 iMiev. They make a really good product. Curt also makes a hitch for a Leaf but i went with Torklift because its made better, it’s a real 2 inch receiver and they are the only ones making a hitch for all the electric cars including Model S and Roadster. When i get my Model 3, i hope to have a Torklift Central Eco-Hitch waiting for it. And no, i dont work there. They are in Washington State and im in NJ. But they shipped it to me in just a few days.

    3. evcarnut says:

      We all have different needs!

    4. evcarnut says:

      Sounds like a plan!

    5. Joe Bonham says:

      Hi Ken. I do lease a Ford Focus electric 2013 with no quick charge. Love the driving experience and amenities, and our longest trip with it has been out of state 110 miles in the dead of winter in the pacific north west with the family and multiple planned charging sessions. We live in Portland and have conquered the mountain range and made it to the coast with the whole family and a loaded roof basket for a beach trip. I definitely have the T-shirt so to speak, love adventure, but would not repeat many of these trips.

      The problem is that now at 45k miles we have noticible battery reduction and it is tough to make it work 27 miles away and back with no charger and tough to make it to the airport and back with no charging. Used to be able too.

      While you and I are early adopters and push through the limitations, to achieve critical mass as a movement, I believe we need less adventurous people to jump on board too. That is while I call 200 miles of range “practical”. No rentals or ICE supplements required.

  7. Speculawyer says:

    I really love the front nose anti-grille. We don’t need no stinkin’ grille and we ain’t even going to make a silly faux grille. Deal with it, ICErs!

    Time to expose the grille for what it really is: a visible admission that every ICE vehicle is so horribly inefficient that it requires an entire subsystem for discarding waste heat.

    1. TomArt says:

      Yes, it is growing on me by the hour. I had a mixed reaction when the 3s drove on stage, but it was short-lived. I put my deposit down while waiting for the live feed to start, and I have no regrets. As long as my 6’4″ frame will be able to sit comfortably in the driver’s seat, I’ll need plastic surgery to remove my damn smile.

      1. Tom – if you get a chance to sit in the car before you buy it or finalize the order – let us know how it fits you, as I am 6’3″ and think your take would be a good enough comparison for me!

        Being it is a 4-door design, though – I also like to first – fit the front seat, and then – fit the back seat – behind the driver! If I am not frog Knee’s, or tilting my Head way over (Like in the Volt, ELR, and others in the back seat Test!) – then this is Solid!

        Currently in a 2010 Kia Soul, and also had a 2004 Prius – bought in 2012 (Sold to a co-worker – who loves it! – He should see this Tesla!) Both offer Great Headroom for me!

        1. TomArt says:

          I’m sure I’ll comment when the time comes.

          I don’t have my hopes up for visibility – I have not seen a Model X in person, but it would be great to get a test-drive. That windshield would be a visibility boon for me – even in my SUV, I sometimes have to slouch a little in order to see an overhead traffic light if I’m at the front of the line at some intersections.

          But, who knows – we’ll find out soon enough, I guess.

        2. Ziv says:

          I saw a video of a guy who claimed to be 6’2″ claim he had 2″ of headroom when he was sitting in the backseat of the III. The driver was a guy, medium height to a bit tall’ish, maybe 5’10” or 6′.
          Not sure if the driver had the seat moved up a bit, which is what I do in my Volt to make the person behind me more comfortable.
          The III appears to be roomier than a Volt or Leaf.

  8. MisterG says:

    Wow, I can’t believe TSLA shares did not increase dramatically…maybe wall street is rooting for fossil fuel industry.

    1. evcarnut says:

      N0 Shock ..

    2. Someone out there says:

      The model 3 has already been priced into the stock since this plan have been available for a long time. This is why TSLA is so highly valued compared to other auto makers that produce a hundred times more cars. People are not buying stock based on what is happening now but on what they think will happen in the future.

      1. jerryd says:

        Soeone, 250k orders in 48 hrs wasn’t built into the stock.

        1. Someone out there says:

          But selling 500k cars per year is. The stock did go up a little bit on the reveal, that is the 250k preorders.

    3. Speculawyer says:

      I was expecting a “sell on the news” drop. But the M3 knocked it out of the park so hard that it actually went up a little more.

  9. Someone out there says:

    Yeah of course there is always someone that isn’t happy, who wants it even cheaper and with more features. What the model 3 shows however is that EVs are making their way into the mainstream. It’s no longer a specialty item, now it is mass market. This should be a huge wake-up call for the entire auto industry, the ICE is dead! Make EVs, the market is there if you make a serious attempt at producing a compelling electric vehicle. Stop with the compliance BS and start producing real cars! Otherwise someone else will do it for you and you will be the next Nokia.

    1. TomArt says:

      Agreed.

  10. David Murray says:

    I think $35,000 should be the low-end limit to get into a Tesla. I think Tesla is and should always be a premium brand. It’s the job of GM, Ford, Toyota, etc… to bring us vehicles that are more economical.

    1. Josh says:

      10 years ago nobody would spend $500 – $1000 on a cell phone.

      Great products create segments.

  11. Thomassen says:

    Even high end brands have small cars, like BMW1 or Mercedez A. These sell in huge numbers, this segment would be great for Tesla. For urban area’s or as 2nd car a more compact car with less range works perfect.

    1. TomArt says:

      Assuming Tesla Motors gets that far, then yes, that will probably end up being necessary – or at least, they’ll have the best offering at that price point, if they have the resources and choose to do so.

      It looks like Nissan and GM are positioning themselves to dominate that segment of the EV market (Renault already does elsewhere in the world).

    2. evcarnut says:

      Just like Elon said.,At 1st Build the more expensive Lower Production Cars , Later get the cost down and build the Less expensive mass production cars for the Masses..Just Like They Do in the electronics industry…

  12. Jychevyvolt says:

    All those used model 3 will trickle down to the mass. Compound math at its finest.

  13. TomArt says:

    I think it’s worth noting that the Model 3 wallpaper pics are all during what appears to be the Fall, unless it’s clever CG. It would seem that they didn’t slap these cars together the night before the reveal.

  14. evcarnut says:

    Model 3 was Long in the making . If you check out the old photo’s of Brown clay Model they Exposed 6 plus month ago .,A close look will confirm that it Was “INFACT” the model 3 Right Under our noses….They Hid it, “Right In front of our very eyes”….L O L….. Clever!

  15. If Tesla Ever Makes a Sub $20,000 EV – I would think – it would come after the Model 3, and After the Model Y (Coming CUV), and after the new Roadster, AND – after a Pickup (Elon’s F-150 Beater!), and maybe – Even After Elon’s Electric Airplane He Wants to do after Cells Reach – or Pass 400 Wh/Kg!

    But – if Elon has not Flown to Mars, by then – he might be ready to do a $20,000 EV with 200 miles Range (His Determined – Minimum Range for a useful EV!)
    :^)

  16. Bone says:

    Prediction is very difficult, especially about the future.

    I think it’s not at all clear that Model 3 will be cheapest 200+ miles BEV when it comes to market. There are many uncertainties:

    – GM may drop the price of Bolt, just like they dropped Volt price.
    – Nissan may come up with cheaper long range BEV. They can have short time from reveal to market.
    – BYD may surprise everyone, or maybe one of the legacy car makers.
    – Tesla may not be able to reach their cost target.

    I’m not saying that Model 3 won’t be the cheapest 200+ mile BEV. It very well might be. It’s just far from certain.

    1. mike w says:

      Agreed. with 300,000 reservations it will be 2020 until Tesla can catchup with current demand. Long waiting times will protect GM’s Bolt for a time. I’m also thinking that the $35K price thrown around for the Model 3 is for the base model. options should push the price way up.