- Hey guys, thanks for joining me.
I'm Ben Sullins with Teslanomics,
and I'm here today to tell you, don't buy a Tesla.
(electronic music)
Don't buy a Tesla if you love sitting in traffic.
Don't buy a Tesla if you love gas stations and pumping gas.
Don't buy a Tesla if you hate the ocean or clean air
or good food.
I don't know about that one.
But, really, if you can't afford it,
please don't overextend yourself.
Buy a Honda, buy a Toyota,
buy something that's gonna last you a long time.
Get a really good value.
Those are really great cars.
Nothing against any of them.
But if you are gonna spend some money on a car,
I thought it might be helpful to look and see
where you're gonna get the best value,
so here what I have is
some data about the true cost of ownership,
mostly from edmunds.com, some I had to curate myself,
and all of the links are in the description below,
about a Model S versus a Porsche Panamera
versus a Mercedes-Benz S-Class,
three of your top luxury sedans out there.
So let's dive into the data now,
and see what it has to tell us.
Before we get into the data,
I need to thank Wunder Capital for supporting the show.
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You see, commercial businesses need up to a million dollars
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they need to actually make this a reality.
On the other side of it, investors, like you and me,
can get up to 8.5% return on this project that is helping
switch us over to a more sustainable form of energy.
So if you believe in this stuff,
and you want to diversify your portfolio,
please go check it out at wundercaptial.com/teslanomics.
All right, let's get into the data.
So first and foremost, I wanted to show you
this affordability calculator on the Tesla website
which helps you figure out exactly which cars
may fit into your budget.
You go here, you choose your option, lease, loan, or cash,
you punch in your monthly budget, and it spits out models
that will fit within that budget.
So this is step one, but if you're already past that
and you know you're in the luxury sedan market,
it's important to understand the value
that you're gonna get, so U.S. News & World Report
has a pretty good comparison chart here,
and I'll link this in the description
so you can dig into it in detail later
and get individual quotes and all that kind of stuff.
Here you can see the prices for the different models,
the overall score, and I do like the little pros and cons
section here, which has really short little points
about each one, so you can compare them pretty quickly.
Now this does have a lot of detail in it as well,
so I'll let you go into that on your own.
But I wanted to do was to look at the true cost
of ownership, and the true cost of ownership is a model
that edmunds.com has been doing for a long time,
and KVB is also doing,
but if we just take look at the data, you'll see that
overall the Mercedes-Benz S-Class is clocking in
at over $127,000 over five years,
and this is how much it will cost to actually own this car.
The Porsche Panamera's at $83,000,
and the Tesla Model S is clocking in at just under $56,000,
a full half of what it costs to own the Mercedes.
If I take a look at the trend
of where these expenses are incurred and when,
you can see from years one to years five,
how each of these cars stack up.
The Model S in year three in fact is quite a bit
more expensive than the Porsche,
but overall stays at the bottom here,
meaning you're gonna get the most bang for your buck
with this car.
So where does this data come from?
Well, if we go back, I can show you that on edmunds.com,
we have the true cost of ownership
of a 2017 Mercedes-Benz S-Class,
and this isn't the 4MATIC one, this is lower-end model,
'cause I'm trying to compare something
that's a bit more reasonable here,
albeit this is still an expensive luxury sedan.
And on here they have all the prices listed out
for over five years, the depreciation, financing,
repairs, maintenance, all those kind of things factored in.
Now this does change over time,
so by the time you're looking at this,
you may see a different number here.
They similarly have one here for the 2016 Porsche Panamera.
I had to use this data
because the 2017 data is not ready yet
but you can see that it is still pretty commensurate
and is fair, I think, in this comparison.
Now unfortunately they don't have the Tesla ones,
so I had to come up with that on my own.
Now, let me show you exactly how these stack up,
and then I'll dig into the details
of how I calculated the true cost of ownership
for a Tesla Model-S.
So here what I have is all those different categories
broken out by model, and you can see the depreciation
and how that stacks up, and you can see to the financing,
and for the financing, I tried to take an average
of the other two, because this really shouldn't matter
that much between which car.
Really, this is more about your bank and your credit history
and all those kind of things.
Fuel, on the other hand, is a big one, where the Model S,
and I estimated here what somebody in California would pay,
and we pay some of the most expensive prices for electricity
so this may even be less
depending on what part of the world you live in,
but you can see it is a substantial amount lower
than the other two models.
Insurance is something that is also pretty subjective,
but again, this may vary for you depending
on where you live, your history,
and the other bundles or discounts you may get.
When it comes to maintenance,
the Tesla Model S comes with a maintenance plan,
and outside of that, everything is under warranty,
so you really shouldn't incur any extra expenses.
However, if you look at the other models,
for the Mercedes, this is really where they lose it,
where your spending potentially thousands and thousands
of dollars on maintenance and repairs.
Now for repairs, I didn't assume anything
for the Tesla Model S,
because everything is gonna be under warranty.
However, this may stack up if you get in a fender bender,
or you hit a pothole or something like that,
you may incur some additional costs,
so know that I'm not thinking anything bad
is gonna happen here, but this is not a real-world scenario
and that you may end up spending a little bit,
but considering the price difference overall,
remember we're talking about less than half
for the Tesla Model S compared to the S-Class
even if I put in a couple thousand dollars here
it wouldn't really make much of difference
in the overall true cost of ownership.
The tax credit of course with the Model S,
currently you get $7,500 tax credit,
and with the other cars you get nothing,
so there's a big difference right there.
And taxes and fees, again, I tried to average these out,
so essentially, the Model S is similar to what you might pay
on the other ones in terms of taxes and fees,
which again are pretty subjective based on location
and that kind of a thing.
I also have all the details laid out here in a heat map
so you can kind of see where at the biggest numbers are
popping out from the page.
And to calculate the Model S true cost of ownership,
what I did is I took the depreciation data,
which was from Autolist, they did a study on this,
and I calculated the relative percentage of the depreciation
and then I took that from the purchase price,
and the purchase price I calculated
by taking a look at the current new inventory on tesla.com,
and I found everything that was a 75 D or below
and averaged that price.
So this is real estimate,
this isn't something I just popped in arbitrarily,
this is based on real data.
Of course, the amount you'll pay will be different
in some way.
It could be less, it could be a little bit more,
it could be a lot more.
But then what I did is I tried to again use averages
from taxes and fees and financing.
I used the California estimate for the fuel costs
and the maintenance I essentially amortized
the maintenance plan over years two through five
to assume that you won't really need anything
outside of that.
So this is how I came up
with the true cost of ownership model.
This is not perfect,
and of course it's not gonna be exactly the scenario
that you're in.
However, even if you argue that their depreciation figures
and maintenance costs of some of these things
may not be exact, you're still looking
at a tremendous savings or value for your dollar
in this luxury sedan market.
Remember, if you take a look at the overall TCO,
both Kelly Blue Book and Edmunds are estimating the S-Class
around $127,000.
The Porsche Panamera is similarly upwards of $75,000
to $80,000, and the Tesla Model, well,
neither of them do that.
That's what I'm trying to do for you here,
is help understand the value,
is at least gonna be $10,000 to $60,000 cheaper
than the other two luxury cars here.
There you have it.
You can see the Model S is an incredible value
for your dollar,
especially compared to these other high-end luxury brands.
Mostly that's because of the depreciation
but also things like fuel and repairs and all that
are just a lot less on a Model S,
so if you're looking to buy one of these cars,
I recommend you go with the Model S,
or at least consider it.
Go for a test drive.
Find your local Tesla store and see what they have to say.
See if it's compelling to you.
If you do so, please let me know down in the comments below,
or if you've done this before, I'd love to hear from you.
Please leave me a comment.
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