Estimated Depreciation after 3 Years

[Getlib]

The expiring $7500 Federal credit is an important value to consider. The expiration will essentially provide a $7500 depreciation buffer.

 

[kotykb]

The expiring $7500 Federal credit is an important value to consider. The expiration will essentially provide a $7500 depreciation buffer.

I agree, I built that into my first year figures in the previous post, it helps protect you from the initial depreciation, especially once the $7500 credit reduced, then eliminated.

I've seen quite a few Model 3's selling on eBay and also Craigslist for MSRP, most of those sellers are pocketing the $7500 credit... not a bad way to flip a car for easy cash

 

[lirandy]

Hate to say it but roughly 50% after 3 years.

Agree with this... similar to other cars in this price point, but without aggressive lease subsidies. 50% sounds right.

i guess these guys wanna buy your car after 3 years

 

[EVNow]

I agree, I built that into my first year figures in the previous post, it helps protect you from the initial depreciation, especially once the $7500 credit reduced, then eliminated.

Lots of unknowns. Tax credit may get reinstated in some form, depending on 2020 elections.

I've seen quite a few Model 3's selling on eBay and also Craigslist for MSRP, most of those sellers are pocketing the $7500 credit... not a bad way to flip a car for easy cash

Possibly illegal. IRS clearly says the car should be bought for use and not resale.

ps : I'll wait until a mostly reliable self-driving capability is available before trading in the 3. May be 5 to 8 years - unless a very good lease deal is available earlier.

 

[kotykb]

Lots of unknowns. Tax credit may get reinstated in some form, depending on 2020 elections.

If the $7500 tax credit gets extended past 200k cars for Tesla, it will impact resale of us early adopters. From what I've read Tesla and the utility companies are pushing hard to extend, we'll see what happens.


Possibly illegal. IRS clearly says the car should be bought for use and not resale.

If you drive it for ~1000 miles and say you don't like it, there is no IRS risk. How would they know your true intention, they wouldn't

 

[EVNow]

If you drive it for ~1000 miles and say you don't like it, there is no IRS risk. How would they know your true intention, they wouldn't

If you drive it for 1,000 miles - 3 would depreciate quite a bit, right ? Aren't most of the flippers pretty much brand new ?

Besides, people who do this kind of thing probably will have other issues in case of an audit, anyway

 

[kotykb]

If you drive it for 1,000 miles - 3 would depreciate quite a bit, right ? Aren't most of the flippers pretty much brand new ?

Besides, people who do this kind of thing probably will have other issues in case of an audit, anyway

If you look locally, people are paying over MSRP for a car thats slightly used. Either get a car now or wait 1.5 years. The sellers are still pocketing the $7500 tax credit minus whatever taxes over MSRP they are covering

 

[EVNow]

If you look locally, people are paying over MSRP for a car thats slightly used. Either get a car now or wait 1.5 years. The sellers are still pocketing the $7500 tax credit minus whatever taxes over MSRP they are covering

Sure they are doing it - but the legally dubious and can get into trouble. I wish IRS had put clear guidance on what buying for use meant. May be hold for 2/3 years ?

Lots of people do lots of shady things and make money. Nothing new here.

 

[adaptabl]

If you look locally, people are paying over MSRP for a car thats slightly used. Either get a car now or wait 1.5 years. The sellers are still pocketing the $7500 tax credit minus whatever taxes over MSRP they are covering

Well that didn't turn out to be true. There is no waiting list for a LR RWD model 3 right now.

 

[SWMONTY]

OP, do you not pay sales tax in your state?

Of course this is all speculation because there are a lot of variables. If there is a Model 3 with 400 mile range, our resale will drop (I wonder what happened to the resale for any other plug in with less then 150 miles of range when the Model 3 started delivering). When, not if, new technology is added to the Model 3, resale will drop if our 3 can't be easily upgraded.

But, getting back this example. Another thing to consider is all of the forced upgrades we are buying to take delivery today (I say forced, because I would have bought LR but maybe not the premium package). In this example, over 1/3 of the MSRP is upgrades or accessories. The base price of the car may not depreciate 50%, but the accessories will for sure. We won't get any premium for having a "color", probably not much for the premium package either. I would suspect long range battery should hold a decent value and auotpilot as well, assuming they continue to make improvements (not that it is bad today, I love it as it is today), and as long as they don't decrease the price significantly.

P.S.
If anyone is reading this in 2021, hope you enjoyed our speculation on the future...

 

[iaflyer]

OP, do you not pay sales tax in your state?

Of course this is all speculation because there are a lot of variables. If there is a Model 3 with 400 mile range, our resale will drop (I wonder what happened to the resale for any other plug in with less then 150 miles of range when the Model 3 started delivering). When, not if, new technology is added to the Model 3, resale will drop if our 3 can't be easily upgraded.

But, getting back this example. Another thing to consider is all of the forced upgrades we are buying to take delivery today (I say forced, because I would have bought LR but maybe not the premium package). In this example, over 1/3 of the MSRP is upgrades or accessories. The base price of the car may not depreciate 50%, but the accessories will for sure. We won't get any premium for having a "color", probably not much for the premium package either. I would suspect long range battery should hold a decent value and auotpilot as well, assuming they continue to make improvements (not that it is bad today, I love it as it is today), and as long as they don't decrease the price significantly.

I wondered about the tax, but he did have a line in the spreadsheet saying "tax/registration" and I looked, Montana doesn't have any sales tax or use tax for motor vehicles. Winner there..

If I was buying a used Model 3 in a couple of years, all cars right now have the Premium package, so that would be "built" into the price of a 2017/2018 model. But things like the FSD - I wouldn't pay any extra for a car with it (at the moment, but maybe that will change as more capabilities emerge).