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Got An Electric Car? How About Pre-Paying For Its Next Battery Pack?

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Tesla Motors - Model S lithium-ion battery pack

Tesla Motors - Model S lithium-ion battery pack

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We’ve all heard the shock stories -- generally from media outlets which haven’t fully researched the topic -- saying that the battery pack in your electric car will only last a few years and then cost you thousands upon thousands of dollars to replace.  

We think its unlikely that most electric cars on the market today will need an entire replacement battery pack for the first ten years or more, if ever. But are there any ways you can safeguard your purchase to make sure you’ve got a replacement battery lined up for if or when something goes wrong? 

That’s the question that Tesla Motors is trying to answer as its Australian sales team adopts a policy already in other Roadster markets to safeguard against being stuck with a poorly performing battery pack in the blisteringly fast Roadster .

Just like the scheme already in place in the U.S., owners can pay an additional $12,000 at the time of purchase in what is essentially, an insurance policy. Heavily discounted from the actual cost of a new battery pack, it helps Tesla owners know that their investment remains sexy and fast for years to come. 

And if your Roadster’s battery pack continues to perform well past the expected 7 year lifespan of its 52 kilowatt-hour battery pack, Tesla will pay back $1000 for every year you continue to drive on your car’s original battery pack. 

What about the used battery pack? Tesla has a plan for that too.  

2011 Chevrolet Volt battery system

2011 Chevrolet Volt battery system

Enlarge Photo

After 7 years, Tesla estimates the massive Roadster lithium ion battery pack will still have at least 70 percent of its capacity remaining. That’s enough to run an entire home -- complete with all of the usual high-power demand appliances -- for two days. 

If the battery pack is beyond use in backup power duties, it will be recycled at one of Tesla’s battery recycling facilities

While some electric automakers say their car’s battery pack will last as long as the car, Tesla are the first automaker selling a car with the option to pre-pay for a replacement.  

Others -- like the French automaker Renault -- are tackling the issue another way by selling the 2012 Fluence Z.E. to customers but leasing the battery packs under a monthly maintenance plan. When the battery pack needs replacing, Renault replaces the pack at no extra charge. 

Lithium-ion battery pack of 2011 Nissan Leaf, showing cells assembled into modules

Lithium-ion battery pack of 2011 Nissan Leaf, showing cells assembled into modules

Would you pre-buy a replacement battery pack for your electric car? Could you afford to? Or are we about to see specialist extended warranty policies develop from insurance companies to safeguard against a failing battery?

Let us know in the Comments below. 

[GoAuto.com, Tesla]

 

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Comments (8)
  1. The only thing I'd like to know is will they refund the money you prepaid if you trade the car in well before you'd ever need another battery? But really the low cost of maintenance that electric cars have buying a $12,000. battery is no big deal compared to a gasoline car over time. I recently helped my sister buy a new car, her old one was 8 years old and needed it's 100,000 mile overhaul, but the cost of the overhaul was greater then it's trade-in value so we just got her a new car. Now I'm sure the dealer will do the work and still profit, I could see the same being done with EVs the car is 7 or 8 years old but instead of replacing the battery people may just trade up and dealerships will work out the replacement then sell the old car.
     
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  2. When people opt for the "new car" they are often very short sighted. It's not just the value of the car vs the repair cost. You must take into account the a) increased insurance b) increased excise tax c) sales tax d) increased registration costs - many of which you get hit with (some, like the yearly excise tax last for YEARS) would easily tip the scales the other way, but people fail to take them into account.

    Example: We have a 97 Taurus - just got a new motor put in it for $2500 with a lifetime warranty (yes, if that motor goes it will be replaced free). Cost to buy a newer/nicer car would easily have been 10-15k. Even though this car wasn't worth much, we KNEW IT and had been maintaining it. Other (used) cars can be headaches!
     
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  3. The reason ideas like this are , well, pretty stupid, is that battery prices are anything but stable. I can guarantee that no one can estimate with any clarity not only what battery prices will be 8 years from now, but exactly what kind of batteries will exist in 8 years. I can say that prices will be much lower, regardless, and the lifespan costs will also be much lower. So don't waste your money on any kind of replacement program - there is absolutely no way to know that these programs are of any value and many reasons to assume that you will pay a whole lot more
    using them. Calling them "insurance" is nonsensical, unless it means the customer is almost guaranteed to get the worst of the deal.
     
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  4. did you ever beat me to the punch. sounds like a good way to rob from your customers. 8 years is an eternity, when it comes to batteries, now that they will be used in cars.

    i can always count on tesla to find ways of making money. they oughta just shut up and actually produce the model s for sale.
     
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  5. Good point Kent, and EV Enthusiast.
     
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  6. Tesla has made that $12k offer based on the expectation that replacement battery will cost less than half of what it does now. So it's not a bad deal. Even though most customers will not sign up for this, it is nice to know that Tesla has offered this assurance and most will look at it as an upper bound for replacement.
     
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  7. But, will they refund the difference if, at that time, the battery cost is less than $12k? There is still the time-value of money to take into account too. No thanks - I'll keep my 12k and yes, I am planning on buying a Model S (base model - 160 mile range battery).
     
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  8. 3 points to consider:
    - The battery is supposed to have 84% capacity left after 16.4 years of daily charging. I think I should put my money in the bank.
    - Battery prices are falling fast, especially lithium battery prices. So this will be cheaper later.
    - There are newer better batteries being "discovered" every day. I think the battery I can buy 15-20 years from now will be much better for much cheaper.
    *** So there is no way I would consider this.
     
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