Published on May 4, 2019 |
by Zachary Shahan
4. May 2019 by Zachary Shahan
I recently published some cost comparisons between Tesla Model 3 and various Honda Accord trims. As I suggested at that time, these models should not even be in the same discussion, since Model 3 is a much better vehicle (safer, faster and more advanced technology, better handling), but the fact is that does compare for 5 years cost of ownership.
But when I published the previous comparisons, I didn't take the cost of including an automatic loan to fund the purchase. (Basically, the analysis assumed direct cash and no time value of money.)
Then I decided to run an updated Model 3 versus Accord analysis and publish the results. As before, I don't really make it for the $ 35,000 base model 3, which is still dramatically better than the Honda Accord. The base model 3 would have beaten Chord in each cost comparison, but most buyers are interested in the Model 3 Standard Range Plus (SR +), so it's the only Tesla model I used for the comparisons.
As a final note before I looked at the results, having made a larger selection of model 3 versus Camry comparisons, I decided to run multiple Accord scenarios to see a wider range of options. I added the absolute basic version of Accord, the Honda Accord LX CVT, and I added the Honda Accord Touring Hybrid E-CVT. I also ran comparisons in the US average of 13,500 miles a year for all the opportunities.
The short story from doing all these comparisons is: The Tesla Model 3 beats the Honda Accord in almost every scenario. In fact, Accord only wins with the basic version of 10,000 miles / year – and it would have lost the basic version of Model 3 if I had been a little more fair and included it.
Short summaries for each trim on Some different annual mileage are as follows:
|Model||5 Years Cost (est.)|
|Tesla Model 3||$ 23,678|
|Honda Accord Touring Hybrid E-CVT||$ 27,416|
|Honda Accord EX-L Honda Accord Sport CVT||$ 27,499|
|Honda Accord LX CVT||$ 25,893|
|Model||5 Years Cost (est.)|
|Tesla Model 3||$ 22,803|
|Honda Accord Touring Hybrid E-CVT||$ 25,229|
|Honda Accord EX-Hybrid E-CVT||$ 26,631|
|Honda Accord EX Hybrid E-CVT||$ 25,305|
|Honda Accord Sport CVT||$ 24,112|
|Honda Accord LX CVT||] $ 22,393|
You can see the various details / assumptions in this Google archive. As before, I strongly encourage you to copy one of the categories as an example and run your own numbers – to better match the inputs and outputs of your specific case.
My core assumptions, which did not vary over the many scenarios summarized above, include:
- $ 5,000 down and 5.5% interest on auto loans.
- Kelley Blue Book estimates for resale values / depreciation after 5 years.
- $ 3,750 US Federal Tax Credit for Tesla Model 3.  No additional features for the Model 3 or Accord (of course, Accord has much poorer performance and support technology, as well as a significantly lower NHTSA safety rating).
- $ 0.10 average charge charge charge (this may be much lower or significantly higher depending on the individual, but I think it's a decent guess for a median value).
- $ 3 / gallon for gasoline. The average price in California is currently over $ 4 / gallon. In New York, it's almost $ 3 / gallon. In Florida, it's $ 2.8 / gallon and in Texas it's $ 2.6 / gallon. The price of gas will probably fluctuate in the next 5 years – it can go much higher or fall lower again. I'd bet it goes higher, and thus see $ 3 / gallon as conservative (favors Accord), but it's up to you which figure you think is best to join in this period.
- $ 0 maintenance costs. It's a big case that Model 3's maintenance costs should be much lower than Accords, but it's also the opposite argument, and we just don't have much insight into what's in store after 5 years of ownership so I'm leaving the figure at $ 0, and all can easily add maintenance costs as they fit and can quickly adjust the calculations.
- 4 mil per kWh of efficiency for model 3, which is slightly lower than the official grade.
- MPG ratings from Toyota's web site for each trim.
Regarding the insurance case, I decided again that the costs vary too much by state, individual, etc. to include it in these comparisons. Also, Tesla should launch its own insurance option in the coming weeks. For much more in the insurance area, I recommend this huge analysis: Tesla Forsikring: Information arbitrage to save money.
Do you want to improve the analysis for your own needs? Collect some insurance estimates for yourself for Model 3 and Accord, and then add the numbers to your spreadsheet. Also select the additional features you want to select. (But if you add features in the model 3 that Accord does not offer at all, take it into consideration.) Once again, you can copy a template from here.
As I mentioned at the top, objectively, Model 3 is an incredibly better car than Accord. The fact that Model 3 is also estimated (in these scenarios) to cost less than Accord, makes Model 3 a non-brainer in my opinion. Although specific variables change, giving the Accord the cost advantage (different resale values, a lower average gas price, or fewer miles driven for example), the fact that these two models are tight at cost is insane. Looking at these comparisons and comparisons with the Toyota Camry, it seems clear to me that model 3 is going to be the best-selling car in America – and will be one day.
Notify me if you think there is anything critical I missed in these comparisons, or what your individual results show.
Interested in buying a Tesla Model 3 (or model S or model X)? Need a referral code to get 1,000 miles of free Supercharging? Use our: http://ts.la/tomasz7234 (or use someone else if they helped you more).
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