Tesla selling same car for less money, with less range. What's wrong with this picture?

model s
© Tesla Model S

The Tesla Model S is an expensive car for the 1 percent, but Elon Musk says in a press release:

...we’ve heard from a number of people who would like to buy a Model S, but can more easily afford it only at a lower price point. To respond to these requests, on Thursday June 9 we’re introducing two new variants of Model S – Model S 60 and 60D, offering a compelling feature set and a great value at a new low price. The new Model S 60 delivers more than 200 miles of range, a top speed of 130 mph and zero-to-60 acceleration in 5.5 seconds, starting at $66,000.

So now it is an expensive car for the 1.1 percent, which is nice. But what at first appears to be not so nice is that fact that they are selling the same car with the same batteries as the S 75, namely 75 kWh of batteries, but put a software lock on them to limit capacity to 60 kWh which reduces range to about 200 miles. This is pretty common in the software and chip world, but in a car? It is like selling a V8 with two cylinders turned off as a V6. As a commenter pointed out on CleanTechnica:

"Software limited" options have always seemed disingenuous to me. "Here's a pie. You get the whole thing, but you can only eat four slices unless you pay us extra for the last two."

A lot of people think this is a terrible idea, carrying around the dead weight of 15 kWh of batteries that you are locked out of using. But according to Seth Weintraub of Electrek, that's not the case.

People with 75kWh with access to only 60kWh battery packs can charge their cars every day to full without hurting their batteries. Tesla recommends that on a day to day basis Model S only fill your batteries to about 90% full. This prolongs the life of the battery and is something that every Tesla owner does. On the rare long trip you can fill to 100% but the car will warn you every time that you are hurting your battery. But if you have an extra 20% of battery idle like these new 60kWh configs, you can fill it to 100% every day. That’s 210 miles vs. the under 180 that a normal S 60 driver has and 30 more miles of real world usage every day.

The car might also have a better resale value, given that buyers will know that the battery pack was not pushed to the limit all the time. But you can also change your mind, pay the man and get the software lock removed, and you have a real S 75. So really, it's a pretty good deal if you can get by with a little bit less range. What's hard is figuring out what Tesla gets out of it, selling the same hardware for $ 8500 less. Seth Weintraub believes that they will eventually get that money back, either when people upgrade or when they trade it in, at which point they can just update it. He concludes:

The ability to buy extra battery storage that lives dormant inside your car is a big, big deal. It has never been done before on any other vehicle though I guess you could put a gas can in your ICE car’s trunk but that’s really another thing entirely. The point here is that we have a new paradigm. Tesla makes this as easy as possible with hardly any downside.

Well, there is one downside, you still need 66 grand.

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