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Tesla Model S Owners Could Realize Amazing Savings

There seem to be many misconceptions about the Tesla (TSLA) Model S, the first electric car to be named Motor Trend Car of the Year, and the only car to ever receive the award by unanimous decision. The main mistake that seems to pop up a lot is the assumption that the Model S is a toy for the one percenters. Although the Model S is a premium sedan with a high dollar sticker price, this is not at all the case. I’m writing this article as a follow-up to my last article, Tesla Motors: A Perfect Hedge, to show why the Model S, if financed, is affordable for anyone who can afford a new mid range luxury car.

Competitively Priced

The Model S starts out at $52,400, and goes up to around $100,000 for the fully loaded performance edition. For the purpose of this article, I will assume that the average price is about $75,000. The Model S is priced to be competitive against a similarly priced car; such as the BMW M3 series. However, when looking at the total cost of ownership, the Model S costs significantly less, and many have suggested offers tremendously more.

“The Model S is faster than a BMW M5, has a longer range than any other pure electric car, and looks like the future” (Jalopnik)

Gas is expensive

In 2011, Americans on average spent $4,000 for $3.51 a gallon gasoline. If you assume $4.00 for premium fuel (since a comparable ICE car would not be running on regular), that number easily rises to $5,000. Assuming an average car will be used for 8 years, is driven 12,000 miles per year, and gets 25 miles to the gallon, the amount spent on gas over the life of an ICE car easily reaches $40,000.


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