Are Tesla cars a good investment?

[Beery]

So as of right now I'm planning on getting a tesla model 3 LR around 3 years from now, I am currently in a secure job in the construction industry earning around 35-40k a year. I'm wondering if this annual salary warrants me buying this ev as I have really wanted to get into the ev market for a long time now. By the time I want to buy the car I'll have around half of the value ready to put towards the car and the rest will be from a low/no-interest loan. Is this a good investment or should I be careful with how much I am willing to put towards this car, in my opinion I see it as a good buy because of the fact that the car depreciates at a much slower rate than normal ICE cars but that could be just because of my love for tesla.
Also how did everyone here pay for their tesla, pcp, lease, loan etc.

 

[M3noob]

So as of right now I'm planning on getting a tesla model 3 LR around 3 years from now, I am currently in a secure job in the construction industry earning around 35-40k a year. I'm wondering if this annual salary warrants me buying this ev as I have really wanted to get into the ev market for a long time now. By the time I want to buy the car I'll have around half of the value ready to put towards the car and the rest will be from a low/no-interest loan. Is this a good investment or should I be careful with how much I am willing to put towards this car, in my opinion I see it as a good buy because of the fact that the car depreciates at a much slower rate than normal ICE cars but that could be just because of my love for tesla.
Also how did everyone here pay for their tesla, pcp, lease, loan etc.

 

[M3noob]

My Ouija board is no better than your crystal ball. At the moment, next Easter is speculative.

It's a car, not an investment. You want an investment? Buy gold.

 

[Medved_77]

So as of right now I'm planning on getting a tesla model 3 LR around 3 years from now, I am currently in a secure job in the construction industry earning around 35-40k a year. I'm wondering if this annual salary warrants me buying this ev as I have really wanted to get into the ev market for a long time now. By the time I want to buy the car I'll have around half of the value ready to put towards the car and the rest will be from a low/no-interest loan. Is this a good investment or should I be careful with how much I am willing to put towards this car, in my opinion I see it as a good buy because of the fact that the car depreciates at a much slower rate than normal ICE cars but that could be just because of my love for tesla.
Also how did everyone here pay for their tesla, pcp, lease, loan etc.

As you reside in Scotland, check out the Energy Savings Trust (EST) that will help with an interest free loan for a considerable portion of the car.

 

[Alan J]

So as of right now I'm planning on getting a tesla model 3 LR around 3 years from now, I am currently in a secure job in the construction industry earning around 35-40k a year. I'm wondering if this annual salary warrants me buying this ev as I have really wanted to get into the ev market for a long time now. By the time I want to buy the car I'll have around half of the value ready to put towards the car and the rest will be from a low/no-interest loan. Is this a good investment or should I be careful with how much I am willing to put towards this car, in my opinion I see it as a good buy because of the fact that the car depreciates at a much slower rate than normal ICE cars but that could be just because of my love for tesla.
Also how did everyone here pay for their tesla, pcp, lease, loan etc.

Hi I see you're from Scotland you may be aware that the UK Gov currently contribute £3K towards the cost of the Car but the Scottish Gov also currently offer an Interest free Loan of £28K over up to 6 years. These incentives won't last forever but it's your call when to jump into the EV Market. In terms of depreciation in may be too early to tell but I believe the indications are positive, others on this Forum will probably offer you their own experience.

 

[LukeUK]

It's a car, not an investment.

This. Buy a model 3 because you want to, because of low running costs, EV incentives, etc.

Don't buy a model 3 because it will become a classic. Tesla iterate quickly, the model 3 you buy will be outdated and upgraded within 6-12 months, most likely, unless you wait until they have moved on to the next model. Depreciation at the moment is I think due to the fact that demand outstrips supply and the car(s) are new to the market. This will change over the coming years - Tesla are churning out cars by the tens of thousands each quarter.

For me personally, a Tesla is about saving money, but as a company car driver, I bear very little of the risk. The personal saving for me is a couple of hundred quid a month - quite significant - but in three years time I will hand the car back and decide what to have next.

 

[dirkbike1]

Tesla is the worst depreciating car I have ever owned.

 

[AllanO]

All new cars sold today will probably see a higher loss of value than we have been used to.

When we reach the point where buyers of second hand cars get their eyes on EV, the price of used petrol or diesel cars will skydive, because the second hand market will be flooded with these cars. However, buying an EV will not be much better, because the price of new EVs is also dropping very fast, which will push the price of second hand EVs far down.

So you should only buy a new car if you are prepared to absorb a huge loss of value.

Will this be better if you buy a new car 3 years from now? I don’t know. But I think the future value loss of a car will be more predictable at that time because the EV market will have matured, so everyone will know what to expect.

 

[Medved_77]

Here's a depreciation forecast against other ICE cars in it's class.

It's from the auto section of the Daily Express so make of that what you will.

 

[Beery]

So as of right now I'm planning on getting a tesla model 3 LR around 3 years from now, I am currently in a secure job in the construction industry earning around 35-40k a year. I'm wondering if this annual salary warrants me buying this ev as I have really wanted to get into the ev market for a long time now. By the time I want to buy the car I'll have around half of the value ready to put towards the car and the rest will be from a low/no-interest loan. Is this a good investment or should I be careful with how much I am willing to put towards this car, in my opinion I see it as a good buy.
Also how did everyone here pay for their tesla, pcp, lease, loan etc.
I'm planning on keeping this car for many years to come and the fuel savings are a big factor in why I am buying it.

Forget the fact I mentioned anything about it being an investment as that wasn't the reason I posted this question in the first place.

 

[MrAliG]

A Model 3 LR costs £47,000 currently. Changing the question to is it a good idea/deal.

You would expect to lose 40-50% of that over 3 years. So £19-23,000.

So if you bought one and kept if for 3 years it would cost roughly £7,000 a year in depreciation (I cross referenced leasing costs which seem similar). On top of this you have insurance and electricity. Depending on your mileage and what you are comparing it to, there will be modest running costs savings. Insurance tends to be expensive, but electricity is a lot cheaper than fuel. So maybe you save £700 a year in running costs assuming around 10,000 miles a year.

For comparison a BMW 320i 4wd might be around £1000 a year less on a lease so very close in total yearly cost. The BMW is much slower, just giving it to compare. A Kia E-Niro would be around one third cheaper to run, a Golf or a Skoda Karoq could be around half the cost of ownership, but they are cheaper, slower less cool cars.

Personally it looks quite a high percentage of your take home pay to spend on a car. It would be almost a quarter of your take home pay. What do you drive/spend currently? But of course how people spend their money is very much a personal choice. Maybe you prefer a nice car to going on holiday.

If you can get a Model 3 as a company car there is a large saving to be had, I think this is helping many people to drive them today.

 

[Kenners]

These curves are based on standard assumptions. What it fails to factor correctly is supply and demand. There are simply not that many Model 3s about, nor will there be in three years time, unless Elon discovers a way of building second hand cars (some people might say he already does given build quality). And over this time EVs will only become more popular. It’ll probably lose half what a BMW or Audi equivalent does. Part of that might well be depreciation getting worse on those cars too. Best comparison is probably something like the Audi Q5 which had bullet proof residuals when it first came out as was with trend.

All cars cost you but with running costs and depreciation I expect a Model 3 to be less than half the cost of running an ICE equivalent. The leasing costs are based on classic depreciation curves as above and are accordingly a massive rip off, but that will persist until market matures. Guess something has to cover the ICE business losses!

 

[jerry33]

So as of right now I'm planning on getting a tesla model 3 LR around 3 years from now, I am currently in a secure job in the construction industry earning around 35-40k a year. I'm wondering if this annual salary warrants me buying this ev as I have really wanted to get into the ev market for a long time now. By the time I want to buy the car I'll have around half of the value ready to put towards the car and the rest will be from a low/no-interest loan. Is this a good investment or should I be careful with how much I am willing to put towards this car, in my opinion I see it as a good buy because of the fact that the car depreciates at a much slower rate than normal ICE cars but that could be just because of my love for tesla.
Also how did everyone here pay for their tesla, pcp, lease, loan etc.

1. Cars are never an investment, they are an expense.
2. I've driven Teslas for almost eight years now. Won't even look at another car--they are that much better.
3. The 2013 S 85 w/tech package I traded in earlier this year ended up actually costing $46K U.S. This doesn't include any fuel or maintenance savings. Just the price of the car after trade-in.

 

[KendoNagasaki]

It’s a depreciating asset, not an investment

it’s fun to drive though, and surprisingly practical

I have a referral code if you are buying

 

[Gatsojon]

The cars aren’t an investment but the stock might be.

 

[GRiLLA]

So as of right now I'm planning on getting a tesla model 3 LR around 3 years from now, I am currently in a secure job in the construction industry earning around 35-40k a year. I'm wondering if this annual salary warrants me buying this ev as I have really wanted to get into the ev market for a long time now. By the time I want to buy the car I'll have around half of the value ready to put towards the car and the rest will be from a low/no-interest loan. Is this a good investment or should I be careful with how much I am willing to put towards this car, in my opinion I see it as a good buy because of the fact that the car depreciates at a much slower rate than normal ICE cars but that could be just because of my love for tesla.
Also how did everyone here pay for their tesla, pcp, lease, loan etc.

This sounds entirely sensible Beery, if you can save half the value in 3 years you'll have a good idea that you'll be able to afford a loan amount after you buy the car. I don't see why anyone shouldn't save and plan for something they want. 20 years ago I bought my then dream car (Ford Puma) and cleared my load over 2 years rather than the planned 3. I've worked hard since and been very fortunate and bought my new dream Model 3 outright with savings.

Plenty else could change in the the next three years as well. Elon has suggested that there might be a new smaller cheaper 25K car, existing prices could go up or down with our currency, trade deals and efficiencies at the new Berlin factory. There will also be plenty of 2nd hand Model 3s around in that time, and lots of other makes of EV.

 

[mrobins64495]

So as of right now I'm planning on getting a tesla model 3 LR around 3 years from now, I am currently in a secure job in the construction industry earning around 35-40k a year. I'm wondering if this annual salary warrants me buying this ev as I have really wanted to get into the ev market for a long time now. By the time I want to buy the car I'll have around half of the value ready to put towards the car and the rest will be from a low/no-interest loan. Is this a good investment or should I be careful with how much I am willing to put towards this car, in my opinion I see it as a good buy because of the fact that the car depreciates at a much slower rate than normal ICE cars but that could be just because of my love for tesla.
Also how did everyone here pay for their tesla, pcp, lease, loan etc.

personally on that salary probably not... it’s a depreciating asset either way... not an investment as others have said. I’d just lease it if anything.

 

[HenryT]

There are too many unknown factors in terms of your personal and financial position, plans/prospects 'capacity for loss' etc to allow anyone on here to tell you what to do, or even if it would be a good idea. That said, there are a number of factors which make the Tesla option an appealing one, as compared to a more traditional choice;

• Lower depreciation potential
• Lower running costs than comparable vehicle ('fuel', VED, servicing costs)
• Cheap finance available in Scotland
• Government grants on purchase and charger installation

What is your plan B - if you don't buy a Tesla (and don't forget, you could always buy a used one,) what would you do instead?

 

[HenryT]

It's a car, not an investment. You want an investment? Buy gold.

...or Tesla shares

 

[Rooster6655]

You would expect to lose 40-50% of that over 3 years. So £19-23,000.

I highly doubt this much. The reason for usually deprecation levels is due to the inflated RRP and discounts that most dealers use