On Sunday, Tesla discontinued the 85 kWh battery that has been part of its product mix since the Model S first went on sale in 2012. The announcement was not unexpected. The company notified customers in Canada the 85 kWh battery was no longer available two weeks ago.
When Tesla introduced the 90 kWh battery last year, it was a safe assumption it would not continue offering two batteries of such similar capacity for very long. As of now, there are 4 options to choose from in the Model S lineup . The Model S 70 is still available with rear wheel drive only. All other cars have dual motors and all wheel drive. They are the S 70D, the S 90D and the S P90D. The P90D can also be had with Ludicrous Mode — a $10,000 option.
Tesla is currently offering lease and financing specials for qualified customers. The lease rate is discounted by $100 a month for a limited time and finance rates as low as 1.99%b for 72 months are available.
Elon Musk has said many times he expects battery capacity to increase about 5% a year for the foreseeable future. Does that mean batteries larger than 90 kWh are coming soon? A 100 kWh battery would have certain marketing benefits and the Model X SUV could use a larger base battery when Tesla gets around to building entry level versions of the car. The X is several hundred pounds heavier than the S, which means real world range with the 70 kWh battery will hover close to the 200 mile mark.
The price gap between the 70D and the 90D is $13,000. That’s pretty big step up. Perhaps Tesla could introduce a new battery that splits the difference between the biggest and smallest battery. That could lure more customers for the Model S sedan.
Somewhat surprising is that cars with the 90 kWh battery cost $3,000 more than cars with the 85 kWh battery did. When Tesla upgraded the entry level car from 60 to 70 kWh, there was no price increase. Tesla should consider reducing the price of the new larger battery to help attract more new customers.