Tesla drops Model S powertrain options to simplify production – no 60D for you

Somewhat buried in the Tesla Q3 shareholder letter was the admission that two powertrain options on Model S will no longer be offered. The significance of the move is debatable.

If you were thinking that the all-wheel-drive version of the 60-kWh Tesla Model S would be perfect for you, brace yourself for some bad news. In the name of reducing manufacturing complexity, Tesla has axed two variants of its Model S sedan: the 60-kWh dual-motor and the P85+ rear-wheel-drive models are no longer available.

Technically, the AWD 60-kWh version never physically existed, but when the dual motor system was unveiled it was one of the powertrain options for order on the company website.

Current Model S powertrain options

The elimination of the 60D and P85+ variants leaves the following powertrain options:

60 (kWh) RWD: 302 horsepower, 208 miles EPA range, 215 miles range @ 65 mph, $69,900
85 (kWh) RWD: 362 horsepower, 265 miles EPA range, 285 miles range @ 65 mph, $79,900
85D: 376 horsepower (188 hp front and rear), 295 miles range @ 65 mph, $84,900
P85D: 691 horsepower (221 hp front, 470 hp rear), 285 miles range @ 65 mph, $104,500

Of note is that the cost of adding all-wheel-drive to the 85-kWh version has been increased from $4,000 to $5,000, while the base price of the P85D has fallen from $120,170 to $104,500, a pretty dramatic price cut. It is the result of forced options being dropped from the base P85D – it no longer comes standard with the Tech, Smart Air Suspension, or 21” wheel packages, which can still be included as expensive add-ons if desired.

The motor power ratings for the 60 and 85 models are somewhat misleading; the website now lists both as 380 hp, but each is limited by its respective battery to the effective horsepower you see listed above.

Why the change?

Wednesday’s shareholder letter contained this passage: “One of the significant actions we intend to take in order to reduce manufacturing complexity is to simplify our product offering by reducing the number of options and powertrain combinations. This will enhance our ability to scale production in 2015.”

Considering that Tesla insists it is production constrained and not demand constrained, and plans to ramp Model S production to 1,000 units per week to meet claimed demand of 50,000 sedans in 2015, this move might be for the best. If the demand really is there, Tesla needs to meet it as best it can.

For that reason, the axing of two powertrain configurations is not a bad thing. (Tesla also is getting rid of the green and brown color options, which we trust nobody will get too upset about).

The elimination of the RWD P85+ model is rather trivial – anyone paying $100,000 for a car surely won’t mind ponying up an extra $5,000 to have the mind-blowing performance of the dual motor system in the P85D.

Getting rid of the 60D option, however, forces buyers who want or need all-wheel-drive to upgrade to the 85-kWh battery, which comes with a $10,000 premium for the extra capacity. It is hard to say how this will affect demand for Model S, but it will do a few favors for the company’s profit margins.

This writer was somewhat dismayed by the axing of the 60D, as I had begun to formulate vague plans for buying a pre-owned Model S 60D in a few years. I want the performance of all-wheel-drive but do not think I would need the extra range of the 85D, so the additional cost is off-putting. But hey, a company’s gotta do what a company’s gotta do. Simplifying the powertrain options will improve Tesla’s bottom line and enhance scalability, so more power to them.