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Tesla hikes solar roof price on contracts signed over a year ago

Hacker News - Mon Apr 12 06:24

Over the weekend, reports have come in of the recent massive Tesla solar roof price increase hitting several customers, some of whom have been waiting about a year with signed installation contracts. The price increase seems to apply to Tesla Powerwall installations, too, with the cost of those increasing by about 30%.

Some customers have even already spent thousands of dollars in preparation for the job, and yet are being told that their solar roof installation will cost tens of thousands of dollars more than anticipated.

The communication was sent out by Tesla yesterday, and it went to many customers. In addition to emails we’ve received on our tip line, a rapidly growing Tesla Motors Club forum thread details price increases for many longtime Tesla customers who have been waiting with signed contracts for up to a year or more. Some have brought up the possibility of legal action.

Here’s the text of the email that’s been sent out:

We have increased the price of Solar Roof and have added adjustments for individual roof complexity. Learn More

You will receive an email in the next 1-2 days when your new agreement is ready for your review and acceptance before moving forward. If you are no longer interested in moving forward with Solar Roof, you can cancel your order by logging into your Tesla Account and your deposit will automatically be refunded.

We will be prioritizing customers based on the order in which they accept their updated agreements.

Upon logging into their accounts, customers have found price increases often around 30% or more above the previous agreed-upon pricing. Some even claim to have been told explicitly that their price would not increase after our report about Tesla’s March price hike.

Adding insult to injury, Tesla also states that they “will be prioritizing customers based on the order in which they accept their updated agreements.” For customers who have already been waiting for months or a year for their new roof, they are now being told that they need to agree to spend tens of thousands more dollars, as quickly as possible, if they want to reduce their wait time.

One Tesla Solar Roof customer: Loans initiated, trees removed

One customer we spoke to placed their order nine months ago, and signed a revised contract in February. They have already signed a loan agreement for the original amount. The original “system price,” prior to credits and including Powerwalls, was $77,019.92:

tesla solar roof contract original price

Tesla sent an inspector out in March who confirmed that everything looked fine and the roof had no special circumstances. But the inspector also said that they had done a few roofs in the area and the wait was likely going to be at least another five months. Previously, they had been told it would be three to six months from when they initiated their order – a time frame that has already passed by.

Now, the system shows up in their Tesla account as having a “system price” of $118,870.33, before credits are applied (but after the combined roof + Powerwall discount, which has been reduced from $2,500 to $2,000):

tesla solar roof system price increase

Notably, you can also see the price increase of the Powerwalls from $14,500 to $19,000 (though it seems Tesla was including the “installation discount” in the contracted number, so perhaps the increased price should be stated as $17,000 for comparison’s sake). Other customers have seen a similar increase.

For this customer, this represents a price increase of a staggering 54.3%. Beyond the loan agreement that was signed months ago, this customer already spent about $5,000 for home improvement preparations, including tree and stump removal to reduce shade on their roof.

They say, with the new prices, they simply won’t be able to afford the Tesla Solar Roof. If Tesla can’t honor the old price, they’ll need to put on a regular roof and solar panels (which they estimate will cost significantly less than Tesla’s updated Solar Roof pricing).

Tesla’s reasoning?

Tesla’s main reasoning for these increased prices is their new “roof complexity” factor. This takes into account how hard it would be to install solar on a particular home’s roof. This is how Tesla describes the factor in its online quote system:

Roof complexity is determined by the pitch, number of joints, chimneys, and other features on your roof. Complex roofs take more time and material to install than simple roofs, which increases the total system cost. Once you place an order, our design team will use remote imagery to confirm your roof complexity and system fit.

But when we looked into last month’s price increase, we found that there were significant price increases regardless of roof complexity.

While Tesla did not mention this in any of their communication, it is also possible that a recent price spike in construction materials could be contributing to the increased cost of installations. Some materials have tripled or quadrupled in price recently.

However, since we don’t know when these installations might happen and the price increases seem similar between contracts signed almost a year ago and those signed just a couple months ago (i.e., after construction materials started going up in price), Tesla’s price increase doesn’t seem to track accurately with construction material price increases. So it’s likely due to other factors on Tesla’s side.

Previous Tesla Solar Roof experiences

Tesla has been slow with Solar Roof installations, as evidenced by the many people who have had agreements for months or even a year and are still waiting for installations.

For those who’ve successfully had theirs installed, we’ve seen some pretty positive reviews. One owner even put up a viral video and website with their experiences and are obviously very happy about the system.

But others have had some nightmare scenarios, including one owner whose house was left roofless while awaiting installation after months of problems.

It should be noted, like every online review of a product, we’ve only heard about the ones who’ve been vocal about their installation process. This means we’re more likely to hear about the best and worst experiences, and less likely to hear about people who just got what they expected and went on with their lives.

The problem is, there have been few enough installations so far that a few positive or negative experiences is all we have. Tesla has been promising a ramp-up of Solar Roof installations for a long time, but we’re not seeing nearly enough sign of it – and the long wait times for people who have active contracts with the company are reflective of that.

Electrek’s Take

Solar installation is quite complex, particularly considering the various bureaucracies involved in terms of permitting and tax credits. It’s possible that Tesla has incorporated some of these possible complications into their upfront prices, though that shouldn’t account for the 30-50%+ increases we’re seeing in many cases. Those costs should be added on an individual basis when they come up, as provided for by the contract, rather than being added upfront to everybody.

If there is some reason for these increases other than the new “roof complexity” factor (which there must be, as simple and complex roofs are both being affected by the increase), it would be better if Tesla were clear about it and tell customers exactly where this price increase is coming from. Customers are more likely to be sympathetic if it’s a simple matter of building material price increases.

In general, Tesla’s customer service and communication can be hit-or-miss (if I’m being charitable), and with the company’s high profile online, it’s easy for complaints to get magnified.

We get stories all the time about people who have fallen through the cracks and ended up with nightmare scenarios. With so many customers, some are bound to have bad situations, or to only be telling us one side of the story, so we have to figure out which complaints pass muster.

That said, many of these situations absolutely should have been handled by Tesla before they got bad, and there are far too many cracks in Tesla’s customer service and communications regime – and this has been the case for a long time.

In this case, even though we did focus on one customer’s story, this situation is obviously showing up as a pattern. The TMC forum thread shows many customers with the same experience of massive price increases on long-signed contracts.

And before too many superfans chime in decrying these reports as some sort of “short attack,” these are not just complainers who are trying to make Tesla look bad. These are people who own multiple Tesla vehicles, who post on Tesla forums, who own Tesla stock, who have committed to spend hundreds of thousands of dollars on Tesla products – probably more than they’ve spent on any individual company’s products. And this is not the first time Tesla has done something similar to loyal early buyers of their products.

Among the various distasteful aspects of these price increases, Tesla’s heavy pressure on customers to sign the new agreements ASAP or be threatened with even further delays is exceptionally tone-deaf. You’ve already made your most loyal customers wait for a year with slow communication and delays. Now you’re trying to milk tens of thousands of dollars more out of them and won’t even give them time to think about it? Come on.

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