Tesla Motors Inc (NASDAQ:TSLA) Drives Better Infinite-Mile Warranty With Model S


Dallas, Texas 08/18/2014 (FINANCIALSTRENDS) – Tesla Motors Inc (NASDAQ:TSLA) the popular car maker of hybrid and electric cars continues to make a difference in the services range in the automobile sector. Considering the technical aspect of electric technology on its vehicles, the company has announced the extension of warranty for Model S, its latest model.

The update could affect the earnings of this new technology car maker, analysts believe.

Infinite Mile Warranty

Tesla Motors Inc (NASDAQ:TSLA) on Friday had a special announcement for its car owners. This announcement was the extension of the service warranty on drive units for the entire 85Kwh Model S sedans.

The conversion of the service now is to ‘unlimited mileage.’

This effectively means the vehicle battery packs warranty is now matched. The changes are from the 4-year and 50,000 miles drive unit warranty of earlier. This much above the regular 3-year warranty 36,000 mile covers for internal-combustion engines.

Earlier, for the Model S, the owners had to pay additional $4,000 to be eligible for the drive unit warranty to further 8 years and seek cover for 100,000 miles.

However, Tesla Motors Inc (NASDAQ:TSLA) latest warranty extension does not match some of the best new-vehicle service warranties covered such as the 10-year period as well as the 100,000 miles which is offered by Mitsubishi Motors Corp.

In explanation, CEO of Tesla ELon Musk commented that, the current extension of warranty, should actually have been in place from the start itself. The extension was justified because the engine had lesser number of moving parts in its engines, rendering them safer and less risky to damage in comparison to regular ICE engines.

However, for investors, the extension of the warranty period does end on a sour note. The company’s latest financial report indicated- moderate to negative impact on the earnings.