A month ago, as I drove my son home from school, I noticed a Tesla in my rearview mirror.
Me: “Oh cool, it’s a Tesla”
Son: “What’s a Tesla?”
Me: “It’s an electric car. Good for the environment”
Son: “Why don’t we drive a Tesla?”
Me: “They are too expensive”
Son: “But they are good for the environment”
Me: “True, but they are too expensive”
My seven year old was not satisfied with the answer and strangely neither was I.
I decided to investigate.
Weighing up the Pro’s and Con’s
After some deep reading on the internet, I found there are plenty of benefits to owning a Tesla compared to a petrol-powered car.
Little to no maintenance: Fewer moving parts compared to a petrol engine car means fewer problems.
Cheaper to run: Electricity is much cheaper in comparison to petrol. (Tesla estimates I can save $1120 a year based on the number of kilometres I drive and average price of filling up)
Reduced emissions: You do your part in protecting the planet. That will make my son happy too.
Let’s flip the coin over and see the disadvantages of buying into the EV club.
Shorter distance: Limited range compared to fuel-powered cars. Not ideal for long-range trips.
Charge vs Fill-up: Filling up a petrol car takes you a couple of minutes compared to 7.5 hours to charge a Model 3 Tesla. If you are lucky enough to be close to a supercharging station it will take ~25 minutes to charge however you still need to pay if you have a model 3.
Portable Mobile Charger is slow: You can charge on the go using a mobile charger which will give you 10km of charge per hour it is plugged in. This means it will take over 48 hours to fully charge a Model 3.
The need to install a charging station at home: The median cost of installing a level 1 charging station in your home is around $700-1000. This is a necessity to be able to keep your Tesla charged at an adequate level to drive every day.
Lack of Tesla Superchargers: There is one supercharger in the city of Brisbane about 30 mins drive from my house. A total of 35 in Australia currently with more rolling out slowly.
Price: Teslas are very expensive compared to petrol-powered cars. This is due to a high level of demand that exceeds production capacity.
The current family car is a VW Tiguan which we bought second-hand for $18,000 AUD. We are very close to paying this off.
Now hypothetically, let’s say Uncle Elon twisted my arm and convinced me to become a Tesla owner.
Going off the Tesla AU website, if I were to buy from the Model 3 standard range and remove the option for Autopilot ☹️. It would cost $73,050 AUD.
I could finance with Tesla costing me $995/month for seven years.
By the time that loan is paid off, my son will be fifteen years old and the battery will be due for replacement. Google tells me the cost to replace a model 3 battery is around $3000-7000. Ouch.
Looking at my current financial situation, there is only one expense which could be cut to make this purchase viable - school fees.
ROI of Education vs Buying the Tesla
To finance the Tesla, it would require pulling my son out of the only school he has ever known. The payments we make for him to attend that school every term could be diverted into a new car loan from 2021. Here is why my wife and I would never make that decision.
We value the education our son receives and the money we spend is more than worth it.
The school promotes a positive environment to learn in and they nurture our son in a way that we think is best for him.
We don’t believe there is another school in our district that comes close to the education and environment to cater to our son.
The ROI of providing a quality education outweighs the cost of buying a Tesla--hands down. The positives of owning one will always be there. I know in years to come more and more manufacturers will release electric cars, this will bring down the current costs making it more affordable. Maybe that day comes in five years or ten years, I'm not sure. What I do know is that there are large investments that are valuable and others that are costly. Weighing up the pro’s and con’s is always a good starting point to identify the investment. The next step is overlaying your own framework of sacrifice and reward. In the long run, is the new shiny reward worth the sacrifice of a truly valuable asset.