Why I Canceled My Tesla Model S Reservation

Tesla Model SOn March 1, 2013, I canceled my order for what I thought would be my next car, a Tesla Model S. The reason is because I felt Tesla was being hugely misleading with their marketing promises and warranty practices. I placed a substantial down payment on what I thought would be my next vehicle, only to find out that it didn’t meet all of the expectations that Tesla had created. They lost me as a customer by putting their needs above their customer’s. Here are the concerns that led to my order cancellation:

  • Annual fee to maintain warranty: Tesla tries to make it sound like they are doing their customers a favor by charging an annual inspection to not void the warranty. However, there is no published maintenance schedule nor are there are details of the work performed during the inspection. There is a comment on a Tesla blog post talking about how an Apple technician couldn’t diagnose a cracked laptop screen over the phone because he was unable to “see” the screen, so therefor Tesla needs to “see” the car to maintain the warranty. I disagree. Tesla needs to improve their diagnostic capability. Or they need to include the inspections in the price of the car. No other car manufacturer voids the customer warranty if the dealership isn’t paid an inspection fee.
  • Deceptive Pricing and Advertising: The Tesla website shows the price after the Federal Tax credit, which is deceptive because you pay the full price of the car when you buy it and you may not qualify for the tax credit. You have to wait a year to get the money back when the file your taxes, but only if you paid enough taxes to qualify for the credit. Most people considering an expensive Tesla would probably  qualify, but not all (especially retirees.) I also didn’t like the “total cost calculator” that wasn’t so clear on actual cost of the car vs. details of supposed savings the car would yield. The number looked low, but you couldn’t tell if it really applied to you or not. It factored in how much time you’d save not filling up a gas tank and assumed your time was worth about $50 per hour. However, it neglected to include the time it took to plug/unplug the Tesla every nite, and forgot about the hour you’d have to spend waiting for the road-side SuperStation charge to complete. The end results is that I felt like I was being hustled. If the car is as great as Tesla says it is, there’s no reason to “trick” people by manipulating the numbers.
  • No Accident Avoidance Safety Technology: Just because a company innovates in one area (high energy density electric drivetrains), does not excuse a lack of innovation in other areas (vehicle safety features.) Tesla represents itself as a technology leader, but that only goes as far as the touchscreen and powertrain. Tesla is clearly lagging the industry is in the area of  automotive technology. Tesla doesn’t offer front collision detection and pre-braking, lane detection, active lane correction, blind spot monitoring, active cruise control, driver drowsiness monitor, or rear collision detection and preparation. All wheel drive would be nice as well. In this price range, pretty much all competitors are offering these features. Safety functions typically are not activated very often, but when they are, they save lives.
  • Probable Battery Replacement after 10 Years: I tend to keep my cars a long time; one is 10 years old and the other is 14. Engine failure/replacement within 10 years is pretty much unheard of. With a Tesla, battery replacement after 10 years is almost guaranteed. Tesla acknowledges this and even offers a pre-payment on the replacement – 10 years in advance of needing it (not a wise investment.) I also have concern regarding the warranty replacement policy for the battery. Tesla has not specified how much the life has to degrade to actually be covered by the 8-year battery warranty. Without clearer guidelines, I don’t have much comfort that a battery failure would actually be covered by the 8-year battery warranty.
  • Unpredictable delivery window and price increase: Forum posts detailed deliveries occurring 6 months earlier than initially communicated and with less than 2 weeks notice give to the customer. Purchasing a new car entails careful financial planning for most people.  If you’re going to make me pre-order, give me the option of sticking to the original delivery date and eliminate the necessity of me having to scramble to deal with finances because delivery will take place 6 months sooner than expected with less than 2 weeks notice.
  • Software bugs: I no longer want to spend my time tinkering with technology that doesn’t work as anticipated. Especially not in something that costs as much as a Tesla does. Other automotive manufacturers have extremely rigorous software test procedures. Forum posts indicate that bugs are pretty common with Tesla, and the bugs can be fairly substantial and even vehicle disabling (rebooting, unexplained software-induced overnight total battery depletion, etc.) I’m sure these will eventually be fixed, but they should never make it to production in the first place.
  • Not as Fun to Drive as I expected: I suppose I shouldn’t have expected a 7-passengeer car weighting 4,650 pounds to perform like a smaller sports sedan weighing 3,400 pounds. I’m looking for a car that is fun to drive both in a straight line and around corners. The Tesla Model S instantaneously produces massive amount of torque, and that is very rewarding to the driver when going in a straight line. But beyond that, I didn’t find it all that sporty or engaging. Manual transmissions help connect the driver to the car where as electric motors give a passive, disconnected experience; I’m looking for the former. I also thought the automatic regenerative braking engaged too aggressively when lifting off the throttle pedal, making me a little motion sick (my daughter as well.) This feature can be disabled so regeneration occurs only when depressing the brake pedal; an intermediate “staged engagement” setting would be my preference.
  • Continual Misrepresentation of Safety Information: I think the Tesla is a very safe car, even though there have been several fires. So I’m baffled as to why Tesla continually misrepresents the facts when it come to safety. This misrepresentation makes me question their credibility and motives.

Wrap-up

Although I canceled my reservation, I still think Tesla is onto something. They got me to consider purchasing an electric car. The car is beautiful, the (optional) 7-seat, hatchback, 2-trunk configuration is very practical. The 85 kW battery version has enough range to make daily driving (and nightly recharging) practical.

However, I think longer road trips are best handled by vehicles with internal combustion engines (particularly diesels.) They can be refueled virtually anywhere in less than 10 minutes and have substantially longer (800 mile) driving ranges.

In the end, there are a lot of automobile manufacturers offering very nice vehicles with fewer ownership compromises and more straight-forward warranties and less deceptive marketing practices. For these reasons, I decided to look elsewhere.

Update

Due to both regulatory requirements and negative customer feedback, Tesla has made notable improvements to their warranty and marketing practices. Had they made these changes sooner, I would have been much more likely to purchase one of their vehicles. Here’s hoping they continue to listen to customer feedback and invest in industry-standard safety technologies.

  • 2013-April-26: Tesla has changed the warranty terms and no longer requires the annual inspection to maintain warranty.
  • 2013-August-06: Although nothing has been officially announced, Tesla seems to be working on improvements in safety technology. A recent software update hints of lane detection and automated cruise control. Reports have surfaced of All Wheel Drive being offered. But it’s all speculation until it ships.
  • 2013-April-26: Tesla has changed the battery warranty and now offers unconditional 8-year battery coverage, so no more guessing on whether or not a battery failure will be covered under warranty during the 8 year period.
  • 2014-July-29: I’m surprised by the numerous issues Edmunds.com had with their Tesla Model S long-term test vehicle. I don’t think all Teslas are this unreliable, but I’m definitely glad I didn’t end up with the car that they tested. From the review: “Extensive list of repairs necessary, interior amenities don’t match other luxury sedans in its price range, latest active safety systems not available . . . numerous problems with its touchscreen, tires and drivetrain make it hard to recommend.”
Written by in: Automotive | Tags: , , , , | Last updated on: 2014-August-13 |

12 Comments »

  • Guillermo says:

    Buy a V8 gasoline car. This is not for you.

  • brian says:

    I’m not sure why you even considered it. Im with you on the annual service fee, but the other reasons I find you contradict yourself. Not enough safe technology? I suppose you want a car to drive itself? How is that fun? Battery replacement is subjective, it all depends on how much you drive. Delivery window? Sure, that will really change my mind from buying one. Software bugs? Every new car has bugs, some never get fixed. I’m not sure why you even bothered.

    • Carlton Bale says:

      Hi Brian,

      For the Safety Technology, if you’re driving a car properly, it will never engage and you’ll never know it’s there. I’m very passionate about safety and have significant involvement/exposure through work. Accidents happen when several small issues happen at the same time, allowing a much bigger accident to occur. Glancing down at the car radio generally isn’t a big deal. Glancing down as someone pulls into your blind spot also isn’t usually a concern, because you wouldn’t be glancing at the radio when changing lanes. But when these two things happen just as the driver in front unexpectedly brakes, there is an accident. This doesn’t happen very often, but when it does, technology can prevent accidents and save lives. But if it annoying intervenes when there is no need to do so, I agree with you, it become more of a distraction than a benefit.

      The software bugs Tesla has experienced are of a much greater magnitude than any other production vehicle I’ve known, except maybe the now defunct Fisker Karma. I can’t think of any other vehicle that has to be rebooted when driving because all of the instrumentation stopped working. Or one that caused the battery to completely drain overnight for no apparent reason after a software update. Or caused the brakes to lock when moving in reverse because the driver seat occupancy sensor was too sensitive. These types of issues should never make it into production. These are more than minor annoyances and I’d rather not deal with them.

      • Rick says:

        Carlton someone above pointed out not only is your diatribe full of contradictions but as an engineer I’m wondering what type of engineering degree you might of acquired?
        I could not stop laughing at the irony dripping from each point of dissatisfaction.
        Based upon reading your entire body of work I really do not understand why you’re even considering purchasing this vehicle.

        1. Safety…..according to you, if you buy and keep your cars every 10 to 14 years..then what kind of safety components do you currently have in you car, compared to those available even five years ago? Does your 14 year old car have crumple zone, air bags,etc, lane change warning, blind spot technology? C’mon be honest with yourself. The list is endless in this rapidly changing technological environment.
        2. Awd. Maybe in a car for winter but with the amount of torque, awd would seem to be unecessary/overkill.
        3. To my knowledge ALL VEHICLES need to be maintained to the dealers predetermined maintenance schedule in order to validate the new car warranty!! Now you might be able to take it somewhere else for maintenance but why would you want to do that, except for price, which I would agree might be cheaper elsewhere. But 600 bucks a. Year for a hundred thousand dollar car??? Pretty cheap.

        4. Delivery and pricing issues….. If you keep your car 10 to 14 years it doesn’t seem like delivery of your car one month earlier or later would mean much. As far as pricing goes if you buy from Tesla you have a fixed price. GO try that at any other dealership FOR ANY OTHER CAR.
        5.not fun to drive????? Zero to sixty in four secs…great handling, an air suspension option…I can only imagine how fun your 14-year-old car is to drive, especially with all the updated technology it must have.!! :) and safety features.
        5. Battery issues?. How long is the average warranty on most current new cars…..not 10 years on the engine or transmission save two brands.

        Lastly but most importantly, based upon the content of your article I wonder if you would have ever bought a car back in the early 1900’s, when they first came out.
        About as fast as a bike. No safety features. All kinds of mechanical issues. No radio. No disc brakes. No seatbelts.
        No headrests. No Windshield wipers. No Antitheft devices.
        No automatic transmission. No color choices. And probably less than stellar guarantee,

        As an engineer why would you want to drive a car that is vastly outdated instead of driving a car that’s constantly updating itself to the newest technology available.

        I shudder to think how anything would’ve got invented if there were more folks like you, when there’s such a compelling lack of interest in the newest technology available.

        As someone above also said…this car’s not for you!

        • Carlton Bale says:

          Rick, you are certainly free to disagree with my opinions, but I find your personal insults against me to be a bit petty and unwarranted. Nevertheless, here are my responses to your points.

          1. When I purchase a car that I intend to keep for a long time, I purchase one with the most advanced safety features available at that time. Of course new safety features will be introduced in the future, but the idea is to not start at a deficit. If safety features were the singular most important aspect of vehicle ownership, then it would make sense to upgrade every few years. But for me, there are a variety of competing considerations, one of which is fully maximizing the investment in the vehicle by extending its life for a very long time.

          2. After the winter we’ve had this year in Indiana, I think AWD is more important than ever. And even as far south as Atlanta, where the city was completely shut down by only a couple of inches of snow, I think the benefits of AWD are apparent. But I agree with you that AWD is unnecessary in most conditions. My biggest complaint against AWD is the fuel efficiency penalty from the additional weight and drivetrain losses. Most other safety technologies have very little negative impact on fuel economy, but the impact of AWD is measurable, even on hybrid and electric cars. From an efficiency standpoint, snow tires provide a substantial traction benefit and little efficiency penalty, and that’s what I use on my RWD Infiniti G35 in the winter.

          3. You are correct that all cars need to be maintained to the OEM’s maintenance schedule. The big difference is that they do not required to be maintained by the OEM. The other major difference is that all other OEMs publish a list of maintenance requirements and detail exactly what is being done at each maintenance interval. Tesla does not provide any of this information. They simply specify that you must pay them $600 and take the car to them, for some undefined inspections. Personally, I try to never pay for something if I have no idea what I’m paying for and what benefit it provides. $600 over 4 years equates to $2400. For reference, that is about how much I’ve spent on maintenance and repairs for all 3 of my vehicles since 1998. This includes oil and filter changes, air filters, brake pads/rotors/fluids, windshield wipers, bulbs, 1 water pump, 2 thermostats, an accessory drive belt, an ignition switch, 2 sets of spark plugs, and 2 oxygen sensors. (It does not include tires.) I achieved this low cost by performing all of the inspections and the labor myself, so you could argue that if the value of personal time is included, the cost is higher, but I enjoy doing this type of work. So for me, $2400 over 4 years for 1 vehicle is substantially more expensive than $2400 over 16 years for 3 vehicles. During these 16 years, I’ve paid exactly $0 to any dealer.

          4. Over a long time horizon, delivery timing isn’t a huge factor. But as you stated, Teslas are expensive cars, and when someone receives call that their vehicle will be delivered in 1 week rather than 7 months in the future as originally forecasted, it can create financial planning stress. As far as the non-negotiable price, I see that as a negative. Tesla is forcing every customer to pay MSRP. It’s very rare that any other brand changes above MSRP, especially for vehicles that are custom ordered, as all Teslas are. For my car purchases, I’ve negotiated prices substantially lower than MSRP, and have done so using publicly available dealer invoice pricing information. The fact that Tesla does not do this is not a win for consumers, expect for perhaps those who do not do well at negotiating and feel comfort in knowing that someone else didn’t pay less than they for the same vehicle.

          5. The Tesla is not as fun to drive as my (almost) 16 year old Porsche Boxster. While the Tesla does have faster 0-60 times, it performs substantially worse around curves. The low polar moment of inertia benefit of a mid-engine configuration is substantial when it comes to turn-in and carrying speed through corners. The feel from hydraulically-assisted steering in the Boxter is immensely superior to the electric-assit in the Tesla, and the manual transmission is much more engaging. I can also say the same for my Infiniti G35 6MT. But for people who define fun-to-drive as being constrained to a straight line and depressing the left foot, the Tesla is superior. As for the safety feature gap, they are surprisingly minimal. The Boxster lacks vehicle stability control, which was added 2 years after I purchased my car, but that alone was worth the cost to upgrade. From a safety technology standpoint, the Tesla doesn’t have anything that my daily driver 2004 Infiniti doesn’t include.

          6. There is a big difference between battery/engine warranty and battery/engine life. I know of no car manufacturer where engine replacements frequently occur after only 10 years or 120,000 miles. With the battery pack in a Tesla, it is very possible that this would be required on most vehicles.

          I think comparing modern safety expectations to those at the beginning of the industrial revolution is short-sighted. The industrial injury and fatality rates were several orders of magnitude higher then, and the value placed on human life substantially lower. I think it’s fantastic that safety has become so much more important over the past century. Just because a company innovates in one area (high energy density electric drivetrains), does not excuse lack of innovation in other areas (vehicle safety features.) I recently read an article where the driver of a Tesla blamed the “new car smell” for causing him to fall asleep at the wheel, cross the center line, and kill a cyclist. Now in my opinion, the “new car smell” is nothing but an excuse for a driver who is solely to blame for falling asleep at the wheel. But it is also my opinion that the cyclist would likely be alive today if the Tesla were equipped with a lane departure notification and avoidance system.

          As for your assertion that nothing would be invented if there were “more folks like me”, I’ll let my public record of 2 patents speak for itself, not to mention other non-publically disclosed contributions I’ve made to my employer. And as for electric cars specifically, they are not all that new or innovative, as the first practical electric car was invented in 1859. The biggest difference with modern electric cars is battery energy density, but even that innovation did not originate within Tesla or the auto industry. Where Tesla excels is packaging these high energy density batteries in a vehicle design that offers a usable driving range in many practical usage situations. But this accomplishment is not without drawbacks that simply are not present in competing automobile configurations. This will change over time. However, I don’t think we will see mainstream adoption of purely electric vehicles, or even plug-in hybrid electric vehicles for that matter, because other alternatives will continue to be less expensive. The fact is that most consumers care more about their costs than they do about their singular impact on the environment. And although electric vehicles do not directly produce emissions themselves, they do indirectly produce remote emissions at the power plant that creates the electricity. Although these emissions are typically less than comparable internal combustion engines, it is a misnomer to call electric vehicles zero emissions vehicles. Remote emissions vehicles would be more appropriate.

          You don’t need to reference a previous commenter to figure out that this car is not for me. That’s the whole point of the original article, and the reason I felt compelled to write it is that I felt like Tesla was being hugely misleading with their marketing promises and warranty practices. I placed a substantial down payment on what I thought would be my next vehicle, only to find out that it didn’t meet all of the expectations that Tesla had created. To Tesla’s credit, and to the benefit of consumers, Tesla has since corrected many of these issues. In a few years, I think they could very well make a vehicle that I would purchase. But they aren’t there today.

  • All Tesla buyers are people willing to stay on the cutting edge in order to be eco friendly. All your points shows you do not have the willingness. Also, point 5, basically discards electic cars at a whole. I’m looking forward an electric perhaps in 5 or 10 years i can buy an basically forget about engine maintenance and gas stations!

    I hope one day once you have some more dispensable income (and the model X is launched) you reconsider buying a Testla, i’d love to read about it here as i do when look for TV info.

  • Dj says:

    Drove the P85+ car, explored the financing options and resale value along with cash out of pocket requirements (I would not be writing a check for $100-120K, alas). It is a fun car for sure, but the purchase numbers just do not make any sense unless you just want to drive a Model S at any cost, logic be dam*ed. Comparing this to the financial side a conventional luxury or performance car purchase (with maker’s subsidizing, guaranteed residuals and such) – Tesla just can’t put this together for the buyer at this time – you’ll still write a $25K check even with their co-branded finance program to guarantee the 3 year residual. Add to that a known $12K-ish battery 10-ish years down the road makes it look even worse. Maybe not for you, but for me.

  • Carlton Bale says:

    The current value proposition for Tesla is basically that an owner pays an extra $10k-$20k for some innovative features and a more environmentally focused design. If these aspects are extremely important to someone, this can be a good investment. If they are of lesser importance, then there are a lot of other vehicles that offer a better value proposition.

    For me, it really came down the the design of the vehicle not meeting all of my current usage scenarios. The compromises weren’t with the advantages and the cost.

    I’m very interested in the BMW i8 gasoline/electric hybrid. It’s smaller, sportier, and has a backup gasoline engine. This means I could drive it to visit my friends and family who live hundreds of miles away in an area where charging is an impossibility. But the cost of the i8 is expected to be even higher than the Tesla, so that’s likely to be a show-stopper for me.

  • Kablo Kanali says:

    A good car to buy. The range is amazing and we are waiting for the low-cost model also…

  • Viktor says:

    You can’t expect a car with groundbreaking technology to be perfect from the beginning. If everybody would demand perfection from new technology it would never succeed.

  • Edward says:

    Carlton. After Elon Musk unveiled the Tesla Model D a couple of weeks ago, all of your points are now pretty much moot…but enjoy what ever you decided to purchase, and drive.

    • Carlton Bale says:

      Edward, you are absolutely correct. Tesla actually listens! I still haven’t purchased a new car and the Tesla Model S 85D is now on my short list. My biggest reservation now is the price. . . it’s a lot to spend on a car (of any make.)

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