The Tesla Model Y is the best-selling electric vehicle (EV) in Australia so far in 2023. With a plethora of government incentives available, how much does it really cost to own a Tesla Model Y? We break it down in this guide 👇
Tesla Model Y Buying Price
The Model Y comes in three variants that are distinguished by different drivetrain and battery pack configurations.
The base model, known simply as the Model Y or the rear-wheel drive (RWD) is by far the most popular variant; and will be the subject of this guide.
At the time of this guide, the 2023 Tesla Model Y starts from $69,300 to $94,900 before on-road costs.
Tesla Model Y Price After Incentives
Tesla Model Y Rear-Wheel-Drive Price
The Tesla Model Y costs between $71,527 and $76,76 after on-road costs and applicable government incentives.
Tesla Model Y Running Costs
Like any car (electric or not) the following items will form the majority of the Model Y's running costs.
✅ Insurance and registration
The fuel (electricity) costs for the Model Y will vary depending on how much you drive and what you pay for the energy.
Below, we've outlined indicative energy rates for common electricity sources, ranging from home charging to public charging via the Tesla Supercharger network.
Comparing these rates to an equivalent petrol vehicle for the same distance covered, you'll be saving anywhere between 41 per cent to 85 per cent in 'fuel' costs.Tesla Model Y Home Charging Guide 🏠🔌
2. Service and maintenance
According to Tesla, the Model Y does not require "traditional oil changes, fuel filters, spark plug replacements or emission checks".
Unlike other manufacturers (both electric and petrol), Tesla vehicles does not have fixed or scheduled servicing intervals. It does however provide a recommended maintenance schedule for several items that should be checked or replaced periodically:
These costs equate to $225 per year, compared to $1567 per year for the average petrol vehicle.
Electric cars are still in the early stages of adoption in Australia and as a result, obtaining insurance may not be so straightforward.
The insurance for a Tesla Model Y is likely to be more expensive than an equivalent petrol vehicle.
Given that the Model Y is yet to hit Australian roads, we are yet to have visibility of the insurance premiums.
Based on the range we've seen for the Model 3 we expect average prices to be between $1200 and $1650 per year (based on a 10% upwards adjustment).
Actual premiums depend on a range of factors that are beyond the scope of this guide, such as how much you use your car, personal driving history, where you park it at home and at work, and more.
Tesla Model Y vs Petrol Equivalent
A car purchase is both a financial and emotional decision. As we cannot quantify the emotional side, we've done our best here to quantify the financial considerations of owning a Tesla Model Y in the long run.
Below we've crunched the numbers and benchmarked the Tesla Model Y against a similar-sized luxury medium SUV – an Audi Q5.
- In this example, the Model Y works out to be:
- $2,000 cheaper to purchase upfront due to the effect of government incentives;
- $3,059 p.a. lower running costs due to lower fuel and maintenance; and
- $17,295 cheaper to own after 5-years.
Tesla Model Y on a Novated Lease
The introduction of the FBT exemption for electric cars has made 'owning' a Tesla Model Y more affordable than ever. We work through the potential savings in the below example. James works as a Sales Representative for a New South Wales (NSW) based company.
- Drives 15,000 km per annum
- Earns $100,000 gross income per annum
- Procure a Tesla Model Y ($69,300 MSRP) through a novated lease and a salary packaging arrangement through his employer.
Over a three-year lease, the total costs of the novated lease are $92,201 - this does not include any tax savings. This is ~$9,300 more expensive compared to an outright purchase. The total lease payments (including running costs) equate to $374 per week and the cost per pay ti James (after tax savings) is $246.
The total cost of the novated lease after tax savings is $71,971. This makes the novated lease over $10,000 cheaper than an outright purchase after tax savings. The tax savings arise from being able to reduce your pre-tax salary by the lease payments and running costs - resulting in James being taxed a lower amount. We explain this in more detail here.
This analysis does not take into account additional interest paid on a home loan or foregone interest on a term deposit for the outright purchase option.
If James decides to sell the Tesla Model Y at the end of the lease, he'll pocket the difference between the sale price and the residual value ($33,903). This will further increase the case for the novated lease.
The table below the key numbers in the example discussed.
Tesla Model Y Cost of Ownership Bottom Line
Compared to the Audi Q5, both the upfront and running costs of the Model Y are lower. Over five years of ownership, you could save more than $17,000.
This analysis does not factor in the impact of depreciation, which is likely to favour the Model Y in the short-term, based on current Model Y re-sale values.
Furthermore, there is a strong case for procuring a Tesla Model Y via a novated lease due to the potential tax savings. In the example detailed above, over $10,000 of additional savings are possible compared to an outright purchase.
As per the above comparisons, purchasing a Tesla Model Y may be considered a sound 'financial' decision due to the potential savings.
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