Monday, April 02, 2018

Seeking Alpha - Tesla Model 3 Headline

Anton Wahlman wrote for Seeking Alpha an article with the headline:

Tesla Model 3 Costs More To Charge Than A Gasoline Car

Now, the bane of many authors is that they don't write their own headline.  Assuming the math in the article is genuine, then the headline might better say:

Tesla Model 3 Costs 1/3 As Much To Charge Than A Gasoline Car

My dad asked me to explain, so here's the email that I sent him:
Well, assuming the math in the article is right, the only problem is the headline.  Tesla Model 3 does not cost more than a “gasoline” car.  It costs more than a 50+mpg super efficient HYBRID.  ($.06/mile vs $.05/mile).

And that’s assuming that you charge at a supercharger at $.24/kWh electricity price.  My price at home is $.18/kWh and in most of the US it is less.  So, that’s dropping it to $.04/kwh right there (vs the $.05 for hybrids).

And, with a hybrid, you are exposed to fuel price risk (although, with EVs, you are exposed to electricity price risk).  None of this speaks to the fact that you can cap your electricity price risk with solar panels.

So…yeah, if you want to buy an EV, and only charge it at superchargers, it might cost more than getting a super efficient hybrid.  But, if you charge it from home, that doesn’t apply - although changing electricity or gas prices could flip the answer back and forth either way.

But, seeing as my Acura gets 25mpg (and is pretty efficient typical car), then a “gasoline” car really costs $.12/mi (by their math), and so a Tesla Model 3 charged from home costs $.04/mi, or a THIRD of the cost of a “gasoline” car.  So the headline should be:

Tesla Model 3 Costs 1/3 as Much Per Mile As Gasoline Car

(and we haven’t even factored in zero oil changes, wearable parts, etc).

(and all of this assumes the entire article’s methodology is correct - I just used the right numbers.  His whole analysis could be wrong, but I’m taking it on faith that it’s correct).