Tesla closed out 2021 with a confusing decision to sell what appear to be new Model 3s with four-year-old batteries. The cars are being sold as ‘demo cars’ on the Tesla website. And in fairness, Tesla is offering a disclaimer to let it be known that the batteries may suffer from performance degradation. But the disclaimer is ambiguous and confusing. What does it all mean?
Needless to say, we attempt to avoid such confusion when we pay cash for cars in San Bernardino County, or anywhere else in California. When we buy cars in Ventura or Riverside, we make every effort to keep things on the up and up.
This is not to say that Tesla is purposely trying to mislead customers. Clearly, they are at least attempting to be open about using four-year-old batteries. But again, their disclaimer is confusing. It does not explain the disparity between old batteries and an allegedly new car. It also mentions nothing about how the standard Tesla warranty would apply.
Tesla Disclaimer Details
All of what we know about the Tesla battery issue comes from a rather detailed article published on the Jalopnik website. According to Jalopnik’s Jason Torchinsky, an eagle-eyed Tesla customer noticed a number of 2021 Model 3s for sale in Los Angeles, Denver, Portland, Miami, and Honolulu. What struck him was the fact that their prices were slightly lower than expected.
Upon further investigation, the customer noticed that the cars were being advertised with a disclaimer that reads:
“This vehicle was built with a battery pack manufactured as early as 2017. While this pack was brand new when the vehicle was built, the cells have reduced capacity due to their age and you can expect up to 12% reduction in range from current production specifications.”
So we know that a certain selection of alleged demo cars have battery packs that could be up to four years old. Fine. But how could the batteries have been brand new when the car was built, given that the car is a 2021 model? That is the confusing part.
Either the disclaimer is incorrect, or Tesla is passing off 2017 cars as 2021 models. That is not likely, but anything is possible in this day and age. Unfortunately, Tesla has not responded to numerous media outlets that have contacted them seeking clarification.
Reduced Range and Warranty Protection
The other thing strange about this whole scenario is that Tesla does not say on their website how its standard warranty would apply to one of these vehicles. Under normal circumstances, a Model 3 with a brand-new battery pack has a range of about 353 miles. Depending on how you apply the 12% reduction, you come up with a lower range of between 307 and 311 miles.
With that said, Tesla offers an eight-year/100,000-mile warranty on the Model 3s battery pack. The warranty states that consumers can expect a minimum of 70% capacity retention during the warranty term. How will that warranty apply to the demo cars?
Will Tesla still warrant the batteries for the full eight years or 100,000 miles? And if so, will the eight-year mark be measured against the batteries’ manufacture date or the cars’? Furthermore, how long will the warranty be if the eight years are not honored?
Know Before You Buy
We would not dare advise people to either buy or avoid buying a Tesla Model 3. All we would say is to know what you are buying before you sign on the dotted line. If getting a 2021 Model 3 at a slightly lower price appeals to you, that’s great. Just be sure you fully understand the ramifications of having a four-year-old battery.
Remember that Tesla batteries cannot be popped out as easily as the batteries in your TV remote control. Replacing them is an expensive and time-consuming proposition. Any chance that you will keep your new Model 3 long enough to replace the batteries is sufficient reason to stop and think carefully here.
The Big Flaw in EVs
It is tough to write a post like this without discussing the electric vehicle’s (EVs) biggest flaw. That flaw is battery degradation. Even the best batteries degrade over time. They degrade even while sitting on a shelf unused. So even if you leave the whole dealership overhead question out of the equation, an EV starts losing value the minute its batteries are installed.
You do not have the same problem with gasoline-powered vehicles. An internal combustion engine that sits unused in a factory warehouse for four years does not degrade. An internal combustion engine rated for 100,000 miles is still going to produce that mileage as long as it is stored properly.
EV makers could eliminate some of the pain associated with battery degradation by making battery packs easy to remove and change. Making all EV batteries interchangeable would be a bigger plus, but that is not going to happen. Tesla and its competitors are determined to stick to proprietary batteries in order to maintain a competitive edge.
Model 3 Resale Value
Getting back to the Model 3 issue, we also have to wonder about the resale value of one of these demo cars. As a company that relies on buying used cars for our livelihood, we always have to consider how much we can get when we turn around and sell what we buy. If the value on a given model is not there, we must think twice about buying it.
To this point, answers from Tesla have not been forthcoming. Journalists and car buffs have been left to speculate about why Tesla seems to be selling brand-new cars with four-year-old batteries. Hopefully we will all get some answers in the near future.
Meanwhile, do not forget about Car Fast Cash if you have any plans to sell your used car in California. Call us to sell your car in Kern, Los Angeles, San Bernardino, and Ventura counties. Pretty much anywhere in Southern California works for us. We are ready to pay cash for cars.