Tesla Model S shoppers can now pick from three battery capacities: 70kWh, 75kWh, and 90kWh. The 75kWh option is only available after picking a Model S 70 or 70D, with the extra 5kWh offered as a $3,000 upgrade that opens up another 15 miles of range.
Tesla revealed earlier that all examples of the refreshed Model S that were ordered with 70kWh batteries actually had 75kWh battery packs that were software-limited to 70. The move helped Tesla streamline their manufacturing lines and synchronize with the Model X SUV, which shares a battery architecture.
But in selling and labeling the 75kWh battery pack as 70kWh, Tesla was able to keep the entry price for the Model S down while offering extended range (to the tune of $600/kWh) to customers that want it. Currently the option for the software change to open up the battery's entire capacity is only available via Tesla's online store, though we expect that owners of the refreshed Model S 70 and 70D will receive notifications that they too are eligible for the over-the-air upgrade if they so desire.
The business model of selling a car with more capability than what is offered to consumers isn't new for Tesla — they did it early on the Model S to save on battery production costs and also sell every Model S and Model X with Autopilot hardware that's not enabled unless the owner pays a $3,000 charge to unlock the software. Compared to how the majority of us have bought cars in the past, it's a radical — and sometimes uncomfortable — change, but one that reflects the changes that have been happening in the economics of the tech industry for years now.