Today I discuss how my Tesla fuel costs are $200 a month lower than if I had a gas powered vehicle.
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I’ve had my Tesla Model 3 since August 2018, so roughly 15 months. Over this time period, I’ve driven it almost 31,000 miles. The vast majority of this driving has been from my commute, which is 80-100 miles round trip (depending on my route). In this post, I go over how avoiding the gas pump and oil changes is saving me over $200 a month in fuel costs.
Why the heck do I have a Model 3?
I’ve previously discussed my rationale for buying an expensive car like the Model 3. Much of the purchase was prompted by my heinous commute from Los Angeles to the hospital where I work. An electric car allows me to legally drive in the carpool lane, cutting 10% off my commute. Tesla’s Autopilot technology also makes my drive much less stressful, and frees my mind to ponder things like this blog and my burgeoning real estate empire.
Another important reason behind my purchase, though, was the fact that Tesla fuel costs are much lower than gas powered cars.
Gas is expensive!
This is especially relevant this year, as recently I’ve noticed gas prices shooting up in Southern California.
The average gas price in Los Angeles during 2018 was $3.51, according to the LA Almanac. In 2019, it’s only gotten worse. Middle East turmoil and refinery repairs in SoCal have pushed gas prices to between $4-5/gallon.
This all prompted me to finally calculate how much I’m saving in fuel and oil change costs by driving an electric vehicle.
For these calculations, my comparison vehicle is the 2016 Mazda CX-5, which gets 26 miles/gallon combined driving, which is a mix of highway and city driving. This was the car that I sold for the Model 3.
Below, take a look at my calculations and summaries.
|Tesla Model 3||Mazda CX-5|
|Miles driven||30,876||30,876 (hypothetical)|
|Efficiency||250 kWh/mile||26 miles / gallon|
|Energy/Fuel consumed||7734 kWh||1,188 gallons|
|Cost per kWh/Gallon||$0.17458||$3.51|
Note: I’m using $3.51/gallon for the calculations. If I used the current average gas prices in SoCal, the savings would be higher.
|Oil change savings|
|Synthetic oil changes||every 7500 miles|
|Number of oil changes||4|
|Oil change cost avoided||$280|
|Total fuel cost savings over 15 months||$2,820|
|Oil change savings over 15 months||$280|
|Tesla fuel cost savings per month||$207|
To efficiently charge my vehicle at home, I did need to install a charging station in my driveway. While this did cost some money upfront to install, it efficiently recharges my car back to full each night in just a few hours.
The charger itself cost $500, but a local rebate program fully covered the cost of this. So my only cost was the fee from my electrician.
|Home charging costs|
|Tesla charger cost||Free with rebate|
|Months to break even||7.65|
Explanation: since I’m saving $207 a month in fuel and oil change savings, the charger installation paid for itself in 7.65 months.
|Payment Comparison (monthly)|
|Tesla Model 3||$932|
|Adjusted with fuel/oil change cost savings||$141 more|
In summary, after accounting for the savings from avoiding gas and oil changes, my monthly Tesla fuel costs are $207 less than with my previous car. Taking this into account, the Tesla is costing me only $141 a month more than my Mazda CX-5. Carpool lane access saves me about 4 hours of driving a month, and Autopilot frees my mind to ponder this blog and things like self-actualization and investment goals.
Overall, I’d consider this money well spent!
Wait… what? The title of the post is misleading, you say? I’m still paying more each month for the Tesla than my other car? OK, alright, fine, you’re technically correct.
While I’m at it, I should mention that I drive a lot more than your average commuter. This amplifies the savings that I’m experiencing.
I still have some unease at owning a Tesla while being a finance blogger. Even for a moFIRE blogger, it seems a bit weird. I’m working through it still. Thanks for listening.
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- Why I bought a Tesla Model 3
- The heartache and joy of owning Tesla stock
- Update on the rental empire: Anno Darwinii 0.25
- The Darwinian Doctor’s 13 Monthly Expenditures (with real numbers)
- 5 Exercises to Do on Your Morning Commute
- What is moFIRE (morbidly obese FIRE) and why do I want it?
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Preaching to the choir TDD.
I am amazed that you drive even more than I do (I’m at about 90 miles round trip because I drop off my daughter on the way to work).
I have already hit 96k miles (Dec my car will be 4 years old). I know I am saving a lot in fuel costs as my prior car got about 25 mpg and required premium (04 Mercedes c320).
My electricity rate is fixed at 9c/kwh. I must drive way more aggressively than you because I average 326 kw/mile. I have probably 3k miles that were completely free by now because of the supercharger but I tend to home charge the majority of time.
Hey Xrayvsn! I forgot to include a shot of my odometer and efficiency stats! I’ll add that in. Part of my higher efficiency might be more stop and go traffic, which I’ve noticed actually seems to be better for electric cars due to regenerative braking. Also the Model 3 is much lighter than the Model S.
Interestingly, it’s high speed highway driving that seems to sap my efficiency the most. I don’t generally drive super fast out of fear of the California Highway Patrol.
Your electric rate is enviably low! If my rate was that low, it would be a no brainer to drive electric.
You presented it well, Tesla’s are more expensive than gasoline cars if you count all the costs but it’s worth it to you and it isn’t hugely expensive. But you lost me when you revealed you took out a loan to buy it. I have always bought my cars with cash. I just figured if I could not pay cash I couldn’t afford the car. Maybe you had the cash and are taking advantage of a zero interest loan? I did do that once, but decided it wasn’t worth the hassle.
Aha! I knew this issue would come up eventually. It’s the age-old debate over paying for cars with cash or financing them.
I’m of the opinion that I’d rather use my available free cash to invest in the market or in real estate.
Why I’m investing in real estate over stocks – Part 1
I figure that if I have a reasonable expectation of getting more than a 2% return with my investments, I’m better off just financing my car purchases with low interest loans (like I’ve done).
To me, this is similar to the debate that rages in the personal finance space over paying off low interest student debt or investing.
There are great arguments on both sides, and this is all great fodder for another post on the subject.
I figured you were arbitraging the loan like that, the math is solid for that of course. I just buy cars so cheap, my current daily driver cost me $7,000, it doesn’t matter. My daughter in law drives a model S, she and my son are both docs. She let me drive it, it accelerates so fast it scared me!
I also own a mazda cx-5 and have long been planning to buy a tesla model 3. I hope we’ll get the same result and won’t be disappointed with my new car(soon). Thanks for sharing this!
Good luck with your decision! Both are great cars. — TDD
I really appreciate this article and all your articles. Just getting exposed to it. I also live in Southern California and have long commutes (40-80 miles one way). Been chugging along in my toyota but have been tempted to get the Tesla and about to pull the trigger on M3 performance or Model Y. Would love to hear your feedback on a few things:
Hey eyeDOC, if you have a long commute, you owe it to yourself to get a Tesla for the Autopilot feature. It’s not perfect, but it’s really revolutionized my commute. The fuel cost savings will somewhat mitigate your higher car cost and insurance. I think I pay between $2500-3000/year for car insurance. You’ll never fully justify a Tesla as a financial decision, but your more pleasant commutes will make it worth it.
I don’t have full self driving because I can’t justify the upfront cost for something that might still be years away (despite what Elon says).
If you have kids (or are thinking about kids), I’d get a Model Y. The extra cargo space will be really great for the tons of stuff you need for kids, like strollers, etc.
Savings from not having to fill up at the pump have been a huge perk of owning my Tesla Model 3. I’ve travelled over 31,000 miles in the past 15 months, and the longest trips have been commuting 80-100 miles round trip. It’s been great not having to worry about topping off the tank – I can just hop in and drive wherever I need to go.
I agree, it’s a lovely perk of an EV with home charging! I’m on a road trip now with my Model 3. The charging stops do extend the length of the trip, but the overall driving experience is so much better than my old gas cars.