Tesla CEO Elon Musk revealed that the Model Y has "between 40 and 60 miles" of extra range that wasn't previously announced. Of course, Musk didn't come out and say he was giving that extra autonomy away for free. He put a price tag on those miles.
In a post on X, formerly known as Twitter, earlier this week, Musk said: “The ‘260 mile’ range Model Y’s built over the past several months actually have more range that can be unlocked for $1500 to $2000 (gains 40 to 60 miles of range), depending on which battery cells you have. Working through regulatory approvals to enable this."
Musk’s tweet is a response to Sawyer Merritt, a Tesla driver who regularly shares or comments on information related to the company on X. In his post, Merritt revealed that the company had launched an updated version of the Model Y with up to 320 miles of autonomy. The new Model Y is $2,000 more expensive than the previous version, which Tesla has discontinued.
If You Want More Range on Your Model Y, You'll Have to Pay for It
Musk’s response makes it clear that Tesla has been selling cars that actually have more range than what the company has announced. According to a report in The Verge, it’s likely that Tesla is still selling cars that have more range than advertised.
In its report, the outlet noted that versions of Model X and Model S with less autonomy weigh the same as the longer-range options. Why is this important? Given how important the battery in a vehicle's weight, it's likely that these models also have extra range that can only be unlocked with a software update.
Additionally, The Verge points out that Tesla already played with the same strategy in 2016. That year, the company advertised that the Model S had a 70kWh battery when it was actually a 75kWh battery. Tesla allowed users to unlock this extra autonomy by paying an additional $3,000.
The company has always been vague about the size of its batteries and the amount of energy available in its cars. The lack of transparency extends to performance, with there being a noticeable difference with vehicles sold in the U.S. compared to those in Europe.
Musk didn't specify which vehicles would be able to unlock the extra range or how the owner of a Tesla Model Y can know if their battery has more capacity. If this update is approved by regulators, everything indicates that it will be the origin of the battery that will determine the car's final range. As stated by Musk, the total number of cells is each battery different even if we're talking about the same car.
Beyond what happened with Tesla’s batteries in 2016, charging for extra range isn't new in the EV industry. To unlock the maximum power of its EQE and EGS electric motors, Mercedes charges $100 per month. A subscription-based Mercedes upgrade allows the owners of some models to reduce the time needed to accelerate from 0-60 mph by one second.
BMW had the same idea as Mercedes and Tesla and planned to charge a subscription fee for heated seats in its cars, though it later axed the plan. Tesla has its own take on subscriptions for its cars, allowing drivers to option to pay to access its most advanced self-driving systems.
By filling cars with high-end features, car makers have managed to reduce costs. First of all, this means they only need one assembly line and only need to install one type of component. In the case of batteries, this represents a large part of the cost of the electric vehicle.
Once installed, it’s the customer who chooses whether to unlock these features (by paying up, of course) long-term or if they don't mind only having access to them a few months per year. For example, some drivers decide to buy Tesla’s Full Self-Driving feature, one of its autopilot systems, if they're going to make a long trip. BMW owners may decide to only pay for heated seats during the winter.
In addition to saving money by offering car features "on demand” and streamlining deliveries, creating a new business line based on subscriptions is now back on the table. Next, companies will have to figure out how to make selling software updates profitable.
Image | Tesla