mitch672
Active Member
retrofit what? it's a totally different Model S, the only things in common are the outward appearance of the car and the touchscreen, everything else has been changed. Its not practical or possible...
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If you do not mind, Please post your trade in offer from Tesla so we can compare note
- Thread starter lolachampcar
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retrofit what? it's a totally different Model S, the only things in common are the outward appearance of the car and the touchscreen, everything else has been changed. Its not practical or possible...
breser
AutoPilot Nostradamus
I don't really buy that. I'm having a hard time believing that the deprecation on a month old nearly 2500 mile vehicle is only $4,800. 10% would be around 10k.
Tedkidd
Member
I don't believe you get a title issued in NY without paying sales tax. All my titles say "CERTIFICATE OF TITLE" then "NEW YORK STATE" on them.
If you do not mind, Please post your trade in offer from Tesla so we can comp...
My comment was referring to the new car sales price. If tesla thought the right price target (because of price elasticity, maximizing margin/volume) was 100k, then they set the price to be 107.5k knowing full well that a buyer normally willing to pay 100k will pay 107.5k with the incentive. Tesla gets the benefit at the end of the day. Buyers just think they do.
My comment was referring to the new car sales price. If tesla thought the right price target (because of price elasticity, maximizing margin/volume) was 100k, then they set the price to be 107.5k knowing full well that a buyer normally willing to pay 100k will pay 107.5k with the incentive. Tesla gets the benefit at the end of the day. Buyers just think they do.
It has been my experience that companies will price up a product to consume any available incentive. The market will accept a certain price so the manufacturer uses this knowledge and does as andrewket suggests and pockets the incentive.
breser
AutoPilot Nostradamus
EarlyAdopter
Active Member
That's a really good offer, especially considering the rule of thumb that luxury cars depreciate 20% the moment you drive them off the lot. I'd take it.
If you do not mind, Please post your trade in offer from Tesla so we can comp...
$12k thrown away for 3 weeks of driving...total BS. Should practically be a crime.
$12k thrown away for 3 weeks of driving...total BS. Should practically be a crime.
Canuck
Well-Known Member
I disagree that the market will accept a certain price. In reality, the market will accept a very wide range of prices, often for the same, or similar, products. After accounting for profit, which must happen or the company goes out of business, the price point is set by how much of the product can be made and sold in a reasonable period of time to account for the profit set by the company. Generally, if you set the price lower, the manufacturer sells more; set the price higher, the manufacturer sells less. But you can only sell what you produce. If you have a glut of product, the price goes down. Scarce product, price goes up. Hence "the law of supply & demand."
We have no EV rebates in BC. In fact, we pay a "luxury tax" on these vehicles. So, by your logic, Tesla should sell them cheaper here. Of course, they don't. Conversely, if we look at Norway, where there are substantial EV rebates and benefits, Tesla should up the price - but they don't.
I do believe that EV rebates come into play when a company sets a price for its product. But it's not a simple as saying they'd be $7,500 less in the States were it not for the rebate. There are many other market forces at play in determining the price and that's far too simplistic of a notion.
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Everyone knows about high depreciation that occurs right after purchasing and driving an expensive vehicle off the lot. Even if that can be called throwing money away, it should never be a crime to throw your own money away.
Tedkidd
Member
I agree. If they want to sell more and truly optimize profit, they will lower price. Both the manufacturer and the consumer benefit.
My understanding is they are actually controlling demand by strategically slowing opening of sales offices. If they wanted to charge more, I think they easily could with or without incentives, but the short gain would be long term impediment to Elon's goals at scale.
Tesla has to be careful about price adjustments and what signals they send. They have a very sensitive market, people are putting a lot of money into these cars and they could really mess up trust.
My understanding is they are actually controlling demand by strategically slowing opening of sales offices. If they wanted to charge more, I think they easily could with or without incentives, but the short gain would be long term impediment to Elon's goals at scale.
Tesla has to be careful about price adjustments and what signals they send. They have a very sensitive market, people are putting a lot of money into these cars and they could really mess up trust.
EarlyAdopter
Active Member
Assuming he's eligible for the federal credit of $7500, that's only $4800 out of his pocket to trade up. And he's in WA state, so no sales tax on his first Model S or its replacement. That's a rip-roaring good deal!
In fact, when considering the purchaser of his used car will neither get the federal credit nor the sales tax exemption (it's only good on new vehicles), Tesla is actually going to lose money on his trade-in.
Take the deal. Take it now!
breser
AutoPilot Nostradamus
It's actually not $12k because you have to subtract out the $7,500 tax credit that I'm keeping. So $94,320 - $7,500 = $86,820 net cost. $86,820 - $82,000 = $4,820. If I reorder the identical configuration the vehicle is $500 less. So the trade loss for just sensors is $4,320.
Edit: Once again I should notice there's another page before replying.
Larry
Member
$67100 for my trade in. 17000 miles. Sticker was $102000 13 mos ago. Steep but normal depreciation. I'm passing on the deal and will sell privately to upgrade to an X whenever they finally make it to the market.
breser I recall you were willing to lose the $2500 deposit to get the sensors, so consider it just another $1800 to get a brand new vehicle with 2500 less miles.
please keep up updated with your decision, be interested to know what premium you place on the autopilot features.
Brewer , were u quoted from Tesla direct? Or from ur local Tesla sales rep?....also which state are u in? I'm in a very similar situation . took delivery 9/20 with roughly similar mileage.
PokerBroker
Member
But I got my 1.5 Roadster CPO for $56k with 16,900 miles! The glut of incoming Model Ss will bring down pricing... If people are considering upgrading to the D, I suggest they trade in their current S before the wave of trades for Model X start pouring in.
Oic...Washington? ....if only Tesla would Freakin get back to me....uy.....worst communication ever from my Tesla sales team.....requested a quote 4 days ago....just another followup email today.....still waiting for a response.......same experience from initial purchase....smh
breser
AutoPilot Nostradamus
I filled out the form on the website (on last Thursday), had a call the next day (Friday) to provide mileage and got an email with the PDF of the quote yesterday morning. Yes I'm in Washington state. The person I'm dealing with is from Inside Sales in California. Based on his response rates I get the impression they are very busy.
This seems likely. Many of Tesla's offers do seem to be seriously lowball (with the exception of the offers on essentially-brand-new cars).
Tesla claims to be clearing 20% gross margins on new cars. I suppose if Tesla is trying to clear the same 20% margin on used cars, that might account for the lowball offers; but it doesn't seem sustainable, since used car dealers can undercut Tesla easily just by accepting lower (but still highly profitable) margins. If CarMax is routinely offering better trade-in prices than Tesla, that's going to dry up any plans for a CPO market.
This is probably also true. Many of the options -- particularly "P" -- wouldn't have nearly as much value in the used market. (The tech package probably holds its value, most of the rest not.)
Still, it looks to me like Tesla is deducting too much for mileage. Based on what we know about actual deterioration with mileage. Don't we have some people on the forum who have put 100,000 miles on their cars? What condition are they in?
I looked at cars.com; the cheapest listing is $44,500, but that's for a 2012 S60 with 30K miles on it. The larger battery seems to hold its value, and to still account for a solid $10K difference in listing prices; it seems that it hasn't depreciated much at all. (This does not surprise me, since so many people are concerned about range.) The cheapest 85s start at 75K. Maybe some cheaper than that have sold, but probably not much cheaper. There seems to be no real loss due to mileage unless the mileage is *really* low; the prices seem to have very little correlation with mileage. There seems to be a substantial loss due to age, which is probably due to more features being present on newer cars.
I'm going to make the radical assumption that most options other than the tech package and the 85 are essentially worthless on resale. If so, this still means that the $67K offers on 85s would give Tesla a solid $8K profit -- *minimum*, assuming that CPO has no value to buyers over private sales. I think Tesla's being overly conservative. Maybe they're worried that the bottom will drop out of the market when the "D" model with autopilot comes out, but I don't think it will. Some 2013 Model Ses are still clearing $90K on the private market, so I think the older Model S will continue to be attractive at $75K. If Tesla wants to make a impact in the CPO market, Tesla needs to lower its profit margin target for CPOed cars, and raise its offers on 85s to be over $70K.
On the other hand, here's a thought. It's possible that Tesla would *really prefer* that you go to a used car dealer. Tesla's been fighting with the dealers' association, partly because Tesla is making their new-car-dealer business model obsolete. If they can go into the used car dealing business, it offers them a graceful way out; if Tesla proceeds to dominate that too, then their businesses are truly dead.
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