My post describing my experience with the dual-motor long-range Tesla Model 3 I bought back in April 2019 generated further questions about battery life, recalls, and driving range in winter that I answer here. Battery life Recently, I was in a waiting room and couldn’t help overhearing a conversation about electric vehicles.  The two people agreed they wouldn’t consider owning one, and the dominant stated reason was fear of high-cost battery replacements.  It became clear after a while that they mistakenly believed EV batteries would have to be replaced as often as lead-acid batteries in gas cars.  The truth is that Tesla batteries are expected to last longer than the rest of the car. A few days ago, I was startled to receive a notification on my phone that my car’s battery needed to be replaced.  A few seconds of poking around on the Tesla app eased my worries.  I didn’t realize that my car has a lead-acid battery as well as its large high-tech battery. ...

Back in April 2019, I bought a dual-motor long-range Tesla Model 3.  I had some concerns about buying an electric car, but my research showed that none of these concerns were likely to be real problems.  Still, buying the car felt like a leap of faith.  Now that I’ve had it for 5 years and 4 months, I can say that it’s been the best car I’ve owned, even better than my Lexus GS400 . Some concerns I had before I bought the car were its price, the charging network when traveling, home charging, battery reliability, self-driving features, and ongoing costs.  Something I didn’t know about in advance that turned out to be a pleasant surprise is the one-pedal driving.  A negative about owning this car is that somehow EVs have become political. Price Compared to other luxury cars, Teslas are reasonably priced.  However, there is no lower end Tesla model suitable for the bulk of car owners.  Teslas are still too expensive for most people.  The lower annual...

I recently helped a family member buy a new car. She was paying cash for the car, so we had to estimate the value of the 0% financing offered to figure out a sensible price to pay for the car. The key factors that matter for estimating the value of low financing interest rates are duration and interest rate reduction. For example, suppose financing is offered for 4 years at a rate that is 4% below a competitive interest rate. This is a total of 4x4%=16%. However, if the car will be paid off over 4 years, the average balance owing will be close to half the price of the car. So, the value of the financing is about 8%. For this example, you can reduce the car’s MSRP by 8% as a starting point for a cash sale negotiation. This is equivalent to paying the full MSRP and taking the financing. From there you can negotiate down from the adjusted MSRP. It was interesting to talk to multiple dealerships and take this approach. A couple just pretended they didn’t know what I was talki...

I’ve long advocated paying cash for cars. This idea is completely foreign to many, but the advantages are compelling. You’ll buy a more reasonably-priced car It’s harder to hand over cash you’ve saved than it is to agree to future payments. Car salespeople are experts at spinning the numbers to steer you into a lease with payments that seem low. But you’re still giving away a huge pile of money when you total up the payments and future penalties. It’s much easier to understand what you’re really paying when save up for a car. And you’re much more likely to make a reasonable choice of car instead of burying yourself in debt. Get a better deal Buying a car is stressful and the salespeople have information advantages over you. When you’re paying cash, there are fewer ways to trick you. Car loans can seem cheap, but the reality of paying for many years may not be in the front of your mind. Things get worse with leases if the contract has clauses that will very likely have y...

Reader AnatoliN asked me to share the spreadsheet I used to work out the fixed and variable costs on my car . So, I cleaned it up, and with great fanfare, here is the car costs spreadsheet . Remember that garbage in leads to garbage out. Unless you have an accurate list of your car expenses, this spreadsheet cannot magically give accurate answers. In my experience, most people know they paid too much for their cars and have a hard time admitting the real costs to others and to themselves. If you want to protect your ego from the brutal truth of how ridiculously expensive cars are, I suggest using the advertised price of $23,999 that got you into the dealership showroom rather than the actual $33,000 you paid after various add-ons and taxes. You can also just estimate your gas costs instead of looking up your credit card bill to see that you actually pay much more. Leaving out the cost of new tires or brakes might help as well. OK, enough sarcasm. You get the point. If you ...

I’ve seen the cost of cars broken down to the cost per kilometer of driving, and I’ve seen it broken down to cost per year. However, neither approach seems to measure costs in the way I want. So, I set out to figure out how to model the cost of my car. I want a better idea of what it costs to have a car and how much it costs to drive it. I began by recording all my car costs in the following categories: – Purchase price – Fuel – Maintenance and repairs – Licensing – Insurance I recorded the month of each cost so that I could use historical Consumer Price Index figures to adjust for inflation. For example, to adjust a cost of $100 in January 2010 when the CPI was 115.1 to March of this year (CPI 122.9), calculate ($100/115.1)*122.9 = $106.78. Then I added up the adjusted costs in each category to get the totals in today’s dollars. The big question is what to do with this data at this point. One possibility is to work out the cost per kilometer. But this seems misle...