Tesla’s model S upgrade packs higher mileage, price-tag

Buyers looking for the new, least-expensive Model S from Tesla Motors Inc will have to purchase an all-wheel-drive car with a higher price, but one that provides a battery with a better range.

The luxury-car maker is phasing out its entry level Model S 60 and replacing it with a version called the 70D.

The 70D, which is priced at sbove $75,000 comes with a US Environmental Protection Agency-rated range of 240 miles (386 kilometers), as against the 208 miles for the Model S 60, which started at about $70,000, according to Associated Press.

The all-wheel drive is a relatively new feature for Tesla, which the company had first revealed on Twitter last fall.

Tesla said it stood for a dual-motor system, that allowed for all-wheel drive, a capability highly sought by luxury-car buyers, especially in the US Northeast which experiences harsh winter weather.

The report quoted James Albertine, an equity analyst at Stifel Nicolaus & Co,''In retrospect, it was remarkable how much market share TSLA rear-wheel-drive vehicles seem to have taken from its all-wheel-drive luxury peers.

''This is akin to TSLA fighting with one arm tied behind its back, in our view, which is perhaps another indication that TSLA demand may be stronger than implied by growing sales during the past three years.''

Tesla said in a statement, "Even at a starting price of $75k, the Model S 70D offers a broad and compelling set of features. Moreover, when one factors in the cost advantages over an internal combustion engine vehicle, including fuel savings and incentives, the actual cost of owning Model S 70D comes to about $55k over five years (the average length of new car ownership).

"In addition to having independently operational front and rear motors, the 70D includes Supercharging to enable free long-distance travel, Autopilot hardware, navigation, blind spot detection and many other features. As with every Model S, the 70D will receive free over-the-air updates that add functionality and improve the driving experience for years to come.

Meanwhile, some commentators link the slew of positive announcements in recent weeks to the company's need to win the PR war.

Last month had been particularly eventful as Elon Musk held a press conference, unveiled software updates designed to eliminate the problem of ''range anxiety'' (concern that the car will run out of power far from a charging station). At the event, Musk also alluded to autonomous driving functionality to Tesla cars, such as self-steering on long highways.

The company was not making money at the moment, and opinions among investors were divided between the highly exuberant and the excessively sceptical.  The share price being highly sensitive to headlines, the company's PR team had to adopt a proactive strategy.

The surprise 3 April announcement on record Model S deliveries was made to combat ''inaccurate'' information being spread by short sellers. According to Albertine who interacted with investor clients, Tesla appeared focused on retaining the ball in the battle for headline catalyst news flow.

Wining the PR war was critically important if the company needed to raise more capital from investors to fund its aggressive expansion plans this year.

Musk had admitted in February that Tesla planned to spend staggering amounts of money on capex in 2015 ($1.5 billion is the forecast).