At Annual Shareholders’ Meeting, Tesla CEO Elon Musk Clarifies Tesla Model 3 Supercharging Policy

Ever since the Tesla Model 3 was unveiled at the end of March, there’s been some confusion over the level of charging that will be included for free when the Model 3 starts rolling off the production line.

That’s because while Tesla CEO Elon Musk promised that Model 3 would come as standard with the necessary hardware for both Tesla Autopilot and Supercharger functionality — just like every Tesla Model S and Tesla Model X made today — he didn’t specifically state if both features would be enabled free of charge or if Supercharger access would be free at the point of use to every Model 3 owner.

Model 3 Supercharger access won't be free.

Model 3 Supercharger access won’t be free.

It was an ambiguity that we and plenty other news sites picked up on, cautioning readers that it was likely, given the sticker price of Model 3 and the amount of investment Tesla has made in the Supercharger network, that Supercharging would likely be sold as bonus or add-on feature. This, we argued, would help prevent Supercharger abuse (where customers choose to charge up at their local Supercharger free of charge rather than at home) while also granting access to the network for those who really needed it. To make it even more useful and cost-effective for owners, we even suggested Tesla might consider offering Model 3 customers ad-hoc membership for the occasional long-distance trip, essentially turning Supercharger access on and off via a paid, time-limited over-the-air update.

Customers who lined up to pre-order Model 3 will have to pay extra for Supercharging.

Customers who lined up to pre-order Model 3 will have to pay extra for Supercharging.

While many Tesla faithful voiced outrage that we would suggest such a thing, it turns out that we were right. At least, we were right about Tesla not offering Supercharger access free of charge to every single Model 3 owner.

Confusion over Model 3 Supercharger access was cleared up once and for all yesterday during Tesla Motors [NASDAQ:TSLA] Annual Shareholder Meeting, at which Tesla CEO Elon Musk discussed in depth Supercharger access for existing and future Tesla owners. When asked by a young Tesla owner and shareholder named Hydan if Tesla planned to continue its policy of free Supercharger access for life for Model X and Model S owners beyond Model 3 launch when there  “are upwards of five hundred thousand million cars out there,” Musk gave a thorough, comprehensive explanation of Tesla policy.

“To date, we wanted to make it really straightforward and easy, so that’s why the Superchargers are set up, at least to date, for those who have bought the car as free for life,” Musk responded. “Fundamentally that has a cost. I don’t want to make this a big headline, but the obvious thing to do is to decouple that from the cost of Model 3. It will still be very cheap and far cheaper than Gasoline, but it won’t be free long distance for life unless you purchase that package.

“I wish we could… but in order to achieve the economics it has to be something like that,” he continued.

While Musk declined to give specifics, this suggests that Tesla will offer free, unlimited Supercharger access to Model 3 owners via an add-on package specified at the point of order, just as it once did with early Tesla Model S 60 cars. While there’s no mention of price, we’d suggest, based on previous pricing policies for the feature, that it would likely come in at between $2,000 and $3,000 for pre-order specification and attract an additional $500 premium for post-manufacture setup.

Model 3 owners will get the chance to use Superchargers -- but as an add-on package.

Model 3 owners will get the chance to use Superchargers — but as an add-on package.

Why not offer it as standard? In a nutshell, it’s all to do with entry-level pricing as well as potential Supercharger abuse. Continuing the conversation, Musk — and Tesla Chief Technical Officer JB Staubel — clarified Tesla’s position further.

“I want to emphasis what Tesla’s motivation is: to make electric transportation as affordable as possible. That informs all our actions,” Musk said. “If we charge for this or charge for that it’s not because we want to make things more expensive. It’s because we can’t figure out how to make it less expensive.”

At the moment, Supercharging is factored into the cost of Model S and Model X. Drivers essentially pay a premium up-front for the privilege of having “free fuel for life”. When building a luxury premium car, adding a few thousand dollars onto the sticker price is a far smaller percentage of the overall cost of the vehicle than it is when the car costs less.

Were it included as a standard-build item, that cost would invariably push up the Tesla Model 3 entry-level price, something Tesla is going to great pains to ensure doesn’t happen. At $35,000 before incentives, Model 3 is the most affordable car Tesla has designed. Since not every customer is going to use or need Supercharger access on a daily basis, it makes more sense to make it a add-on feature for those that want it, keeping the entry-level price low for everyone else.

Of course, we’ve seen this strategy used by Tesla before with regard to Autopilot too. Rather than make it a standard feature on every model, Tesla includes the hardware, offers free advanced safety features to all owners, and makes Autopilot part of Tesla’s $2,500 technology package.

Supercharger infrastructure is costly to install.

Supercharger infrastructure is costly to install.

Cost to consumers isn’t the only reason Tesla isn’t planning on offering Supercharger access for free to Model 3 owners, either. Cost to Tesla is an important part too. Building Supercharger stations is expensive and the more cars on the road that require Supercharger access, the more Tesla has to invest in it. Right now, that investment is something of a loss leader. What’s more, Tesla is learning the hard way that some Tesla owners are abusing the system, using Superchargers to charge on a daily basis rather than charge at home.

It’s something that JB Staubel told Tesla Shareholders wastes customer’s time too.

“It pains us to see people misvalue their time at Supercharger stations so often,” he said, noting that Tesla frequently sees customers fail to charge their cars at home to then drive to a Supercharger station, where they then spend upwards of half an hour charging their car before going on to their destination.

“It’s far more convenient and faster for you overall to charge at home or at work,” he continued. “It takes one second to plug in and you don’t have to go to a separate location and wait for the car to be there.”

It’s a message that Tesla has worked hard to send in recent months: Supercharger access is not a local gas station that owners should use for their daily driving needs. It’s an occasional service designed to facilitate long-distance travel when an overnight charge is not enough to satisfy daily needs. With a range in excess of 200-miles available on even the entry-level Tesla Model S 70D and Tesla Model X 70D, it’s a message that makes perfect sense, too.

Here at Transport Evolved, we think Tesla’s policy on Model 3 Supercharging makes perfect sense. In everyday driving, we rarely exceed the range of our staff electric cars — and not a single one can easily travel more than 80 miles on a single charge — even though we’re considered ‘high mileage drivers’ when compared to the U.S. average. As long as Tesla makes Supercharging available for those who need it on an occasional basis without requiring them to permanently enable it, we think the majority of both those who want it and those who genuinely need it (however infrequently) will be satisfied.

As always, there are some fans who are up in arms over Musk’s decision. Some are even threatening to cancel their Model 3 reservation. Sadly however, there’s rarely such thing as a free lunch.

Do you think Tesla is acting appropriately regarding Model 3 Supercharging? Will you be happy to pay extra for the facility? Or are you infuriated by this latest disclosure?

Leave your thoughts in the Comments below.

 

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