November 28, 2017

Tesla to charge $150,000 for base model of electric truck

Tesla to charge $150,000 for base model of electric truck

Company increases deposit fee from $5,000 to $20,000 for buyers including J.B. Hunt, NFI, Ryder.

By Ben Ames

Electric car manufacturer Tesla Inc. today set a $150,000 price tag for the base model of its electrically powered tractor-trailer, addressing a major question for fleet operators that are considering swapping their diesel-fueled trucks for a battery-driven Class 8 tractor.

Tesla will charge $150,000 for the Tesla Semi model with a 300-mile range and $180,000 for the model with a 500-mile range, according to the Palo Alto, Calif.-based company's website. Trucks with internal combustion engines typically sell for slightly more than $100,000, so Tesla's price tag is expensive but "not too terribly crazy," said Doug Rabeneck, director in the operations excellence practice at business and technology consulting firm West Monroe Partners.

Buyers will be able to justify some of that cost premium through subsequent fuel savings, but calculating a specific return on investment (ROI) will come down to details about the Tesla trucks' range in real-world conditions and the availability of recharging stations, Rabeneck said.

The announcement adds some of the first details to emerge after a Nov. 17 launch event that featured Tesla founder Elon Musk riding a Tesla Semi into an airplane hangar in a dramatic entrance, but offered very few details. Musk told a webcast audience that the vehicle will pay for itself in two years when compared to the cost of a diesel tractor, citing savings in the electric truck's ability to outperform diesel-powered trucks in aerodynamics, reliability, and fuel.

Several of the industry's largest fleet operators have said they have paid deposits to reserve Tesla trucks. Those include trucking and intermodal giant J.B. Hunt Transport Services Inc., retailing behemoth Wal-Mart Stores, Inc., rental and leasing giant Ryder System Inc., and European truckload firm Girteka Logistics. Neither Tesla nor any of the other buyers have indicated how many vehicles they intend to purchase.

Tesla said today it had increased the deposit required to reserve a Tesla Semi from $5,000 to $20,000. The company also announced it had set a fee of $200,000 to reserve a "Founders Series" edition of the semi, which represents the full price of that model. Tesla did not define what Founders Series meant, but published reports suggest the name refers to the first 1,000 vehicles to be produced.

Tesla did not respond to requests for comment.

Setting a specific price for the Tesla Semi helps to answer some questions about the new vehicle, but the company will need to provide further details before it can convince transportation professionals to invest, according to a report from Stifel Financial Corp., an investment firm. For example, buyers will need to know the truck's weight so they can calculate how much payload it can handle while accounting for the weight of the truck's powerful batteries, said Michael J. Baudendistel, a Stifel analyst. Additional questions concern the timetable for installing a nationwide battery-recharging network, and the recruiting and training of workers to service electric vehicles, Baudendistel said.

The analyst's note was entitled, "Elon Musk, We Have Some Questions Before Ordering Our Tesla Semi."

About the Author

Ben Ames
Senior Editor
Ben Ames has spent 20 years as a journalist since starting out as a daily newspaper reporter in Pennsylvania in 1995. From 1999 forward, he has focused on business and technology reporting for a number of trade journals, beginning when he joined Design News and Modern Materials Handling magazines. Ames is author of the trail guide "Hiking Massachusetts" and is a graduate of the Columbia School of Journalism.

More articles by Ben Ames

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