Latest Price Drop Discussion

[Knightshade]

Of course a 0.9 second to 60 is a HUMONGOUS difference in performance terms. About 3-4 car lengths...

Absolutely... it's just a lot less of a difference than the 1.4 seconds previously implied via Teslas dishonest measuring/listing methods

More significantly I think, 4.0 is as quick or quicker than the vast vast vast majority of other cars on the road... 4.5 puts you behind a lot of not-rare cars (the fastest common versions of Mustangs, Camaros, 3-series BMWs, some S-audis, etc) and 4.0 puts you even or ahead of em. I expect part of the reason Tesla wants it to look like that big a gap is related to that.

 

[wcorey]

The objection to predatory lending isn't because I feel bad for the fools who borrowed money they couldn't afford to pay back, they should have known better. The objection is the way it fueled the price bubble in the real estate market, and the way banks packaged and sold the subprime mortgages, making the crash much worse.

It kind of did that but kind of didn't. People's greed did a lot of it. A deeper study of what happened was people, the population as a whole, were hugely over extended and had zero cushion left. As you said, shame on them'. Some say it's because the cost of living kept pace with what people made so in order to 'get ahead' people had to tap into their home equity. Oh, you want a new car like your neighbor just bought, your home is your ATM.
As for being so-called 'underwater', that's complete BS. Markets change, neighborhoods of perceived value (draw) change. We bought our first home in 77. Our second home in 80 was in a very nice neighborhood but when we sold we, pretty much broke even. In the intervening time, we owed more than the market value. It happens. The danger is when you over-pay for stuff that doesn't even exist yet or buy on a promise of 'getting in on the ground floor', people are greedy, some will put every last dime they have on red 8 if they believe strongly enough it'll come up next. It used to be you'd only get a mortgage if it would be less than 25% of your net pay. That became 33% and then job security went south for the foreseeable future. We never bought a house that either of us alone couldn't pay the mortgage on. It's called financial self defense. Not everybody thinks that way.

 

[raptor5244]

I also believe Musk when he says once FSD shows up the price (either of the car or FSD) will go up precipitously. I believe him, and (universal) you should as well.

 

[raptor5244]

Absolutely... it's just a lot less of a difference than the 1.4 seconds previously implied via Teslas dishonest measuring/listing methods

More significantly I think, 4.0 is as quick or quicker than the vast vast vast majority of other cars on the road... 4.5 puts you behind a lot of not-rare cars (the fastest common versions of Mustangs, Camaros, 3-series BMWs, some S-audis, etc) and 4.0 puts you even or ahead of em. I expect part of the reason Tesla wants it to look like that big a gap is related to that.

No doubt 4.0 - 4.5 is quick. Most ICE cars that advertise those kind of times don't actually achieve them anyway since most are traction limited. Also, since we don't have to shift gears we save time there as well. If they could figure out how to implement some gearing when you hit highway speeds that would be even better.

The Model is the stoplight king for sure. The difference with the M3P vs. AWD is that it goes from quick to stupid quick and somewhat violent and that makes me smile. Heads back to the headrest everyone. My front tires start breaking loose and start wandering left a right a bit as they claw for traction. If you are used to high performance cars then the M3P does not disappoint down low with its instant peak torque power curve and 0-50mph is where we spend the most time accelerating anyway.

I think it is better to state it in terms or horsepower and torque to get a sense of performance value. The M3P add about 100hp and 100lb ft of torque over the AWD. The cost for this extra power is only $7,000 for a AWD > M3P+ and some are only paying $2,000 more for M3P- builds. That is ridiculously cheap for that much more performance. Now, I am not saying everyone needs it, just like people don't need the AutoPark or Summon feature but performance enthusiasts know that is a bargain.

 

[wcorey]

but performance enthusiasts know that is a bargain.

Just north of your comments was a bit on the 2008 meltdown vis-a-vis subprime mortgage. I pointed out that was a part, perhaps a small part of the problem. The MUCH larger part was from a sizeable portion of the population making themselves financially extremely over extended. Saturday I ran across a couple of teenagers at a Tesla store opening. I bet the oldest was MAYBE 18. They were on their second P3D as they totaled their first. Also, earlier on, perhaps a different thread was the a large number of 2018 P3Ds on eBay, Carvana, etc. Not to brag but I suggested this might likely be the outcome because of irrational exuberance over performance enthusiasm. It's about 1 sec difference. not sure where you get 100hp but if, at a young age you ruin your credit rating it is NOT worth it. That's precisely what Alan Greenspan (look it up) said in advance of the .com bust of 2000-2001. For a successful mid-career professional whatever blows your skirt up. For young people, THIMK!

 

[dmurphy]

Also, earlier on, perhaps a different thread was the a large number of 2018 P3Ds on eBay, Carvana, etc.

I had posted those links. And it’s my belief that there’s very, very few Model 3’s on the used market, relative to traditional vehicles.

Comparing my prior Cadillac (about 160k produced) vs Model 3 (about 250k produced) - there’s several orders of magnitude more Cadillac XT5s than Model 3’s on the used market.

 

[Leafdriver333]

I bought my LR AWD in April.

That configuration, today, is $53,990 + $1200 dest fee = $55,190.

I paid, in April, $56,000 + $1200 = $57,200.

That’s a drop of $2,010. Factoring in the $1,875 adjustment in the fed tax rebate, I would’ve saved $135.00 by placing an order today. No adjustment in sales tax, since EVs are exempt in NJ anyway.

Instead of waiting, I’ve been driving the thing for 4,628 miles, for a net cost of 2.9 cents per mile. Totally hosed myself there!! How dare they. </sarcasm>

No wonder you sound like a Tesla cheerleader. I would have saved about $1500 I think. So not too much for me either.
Let's be more considerate for those who would have saved $5000+ if waited 6 months or less.

 

[VQTRVA]

No wonder you sound like a Tesla cheerleader. I would have saved about $1500 I think. So not too much for me either.
Let's be more considerate for those who would have saved $5000+ if waited 6 months or less.

How about you take your own advice & don't judge with your condescending 'cheerleader' designation of the fellow poster.
He maybe lucky but apparently it's better than being good.

 

[raptor5244]

Just north of your comments was a bit on the 2008 meltdown vis-a-vis subprime mortgage. I pointed out that was a part, perhaps a small part of the problem. The MUCH larger part was from a sizeable portion of the population making themselves financially extremely over extended. Saturday I ran across a couple of teenagers at a Tesla store opening. I bet the oldest was MAYBE 18. They were on their second P3D as they totaled their first. Also, earlier on, perhaps a different thread was the a large number of 2018 P3Ds on eBay, Carvana, etc. Not to brag but I suggested this might likely be the outcome because of irrational exuberance over performance enthusiasm. It's about 1 sec difference. not sure where you get 100hp but if, at a young age you ruin your credit rating it is NOT worth it. That's precisely what Alan Greenspan (look it up) said in advance of the .com bust of 2000-2001. For a successful mid-career professional whatever blows your skirt up. For young people, THIMK!

Yeah, I am not suggesting folks go broke buying a M3P. I think your point of don’t buy things you can’t afford goes without saying. Why stop at cars? Doesn’t this this apply to all purchases in life?

The 100hp comes from folks dyno testing the cars to measure the actual power difference between the trims. The point is that traditionally 100 additional horsepower would cost much more than $7000 or $2000 on a M3P- making it a bargain for those that want and can afford it.

 

[dmurphy]

How about you take your own advice & don't judge with your condescending 'cheerleader' designation of the fellow poster.
He maybe lucky but apparently it's better than being good.

Bingo. Just plain lucky.

You know how many other vehicles I’ve sold for WAY less than I paid for it?

That’s right. All of them.

 

[Watts_Up]

It kind of did that but kind of didn't. People's greed did a lot of it.
A deeper study of what happened was people,
the population as a whole, were hugely over extended and had zero cushion left.

As you said, shame on them'. Some say it's because the cost of living kept pace with what people made
so in order to 'get ahead' people had to tap into their home equity.
Oh, you want a new car like your neighbor just bought, your home is your ATM.
As for being so-called 'underwater', that's complete BS. Markets change, neighborhoods of perceived value (draw) change.

We bought our first home in 77. Our second home in 80 was in a very nice neighborhood but when we sold we, pretty much broke even.
In the intervening time, we owed more than the market value. It happens.

The danger is when you over-pay for stuff that doesn't even exist yet or buy on a promise of 'getting in on the ground floor',
people are greedy, some will put every last dime they have on red 8 if they believe strongly enough it'll come up next.

It used to be you'd only get a mortgage if it would be less than 25% of your net pay.
That became 33% and then job security went south for the foreseeable future.

We never bought a house that either of us alone couldn't pay the mortgage on.
It's called financial self defense. Not everybody thinks that way.

So true! Did you saw the movie The Big Short?

 

[dmurphy]

No wonder you sound like a Tesla cheerleader. I would have saved about $1500 I think. So not too much for me either.
Let's be more considerate for those who would have saved $5000+ if waited 6 months or less.

I hope you also caught my later correction where I forgot the value of the Homelink, NEMA 14-50 and phone cables. This recent price change actually would’ve been a $215 increase for the configuration in my driveway. Just in full disclosure.

That all said .... when I decided it was time to buy, I did the math and the price worked for me. I was amenable to Tesla’s offer, and felt good about it. Nobody threatened me, put a knife to my neck, or even gave me the usual high pressure “What do I have to do to put you in this car today?” dealership hard sell. I felt good about the deal then, and I do now.

If someone, today, gets a better deal - awesome. Good for them. Doesn’t mean I got screwed by any means; the terms of MY purchase didn’t change one iota.

Lest I appear to just be lucky all the time
....

Right now, we also own a 2018 Buick Enclave. I bought it at the beginning of its model year. We needed a vehicle, I made a deal and bought it. Felt pretty good about that one too. 6 months later, this was the offer:


Great for whomever bought 6 months after me. I’m genuinely happy for them.

Do I feel “screwed”? Not at all. Again - the terms I came to on that Buick made me happy the day I drove it off the lot, and if someone else bought a vehicle for less money, good for them. My car didn’t turn into a pile of dust, my bank account didn’t cry, it didn’t, doesn’t and won’t affect me at all. Still thrilled with the Enclave - it’s a solid family hauler.

I do my best to keep emotion and finance separate - it leads to irrational behavior.

 

[wcorey]

Doesn’t this this apply to all purchases in life?

Most definitely does!

 

[Knightshade]

The 100hp comes from folks dyno testing the cars to measure the actual power difference between the trims. The point is that traditionally 100 additional horsepower would cost much more than $7000 or $2000 on a M3P- making it a bargain for those that want and can afford it.

On the other hand, a peak HP number on a 1-speed EV isn't nearly as useful info as it is on traditional multi-gear ICE vehicles.

See for example the fact the P and the AWD have nearly the same trap speeds (compared to the RWD which is significantly slower at the end of the 1/4 mile). Now compare to versions of say the mustang that are 100 hp apart and that won't be the case at all.


Nearly all of the Ps extra power is in that ~.9 second 0-60 time. For some driving styles this is a major difference (people who spend a lot of time launching from low/no speeds), for others it's virtually irrelevant (people who spend nearly all their time on highways at highway speeds)

 

[Rachmaninov]

The peak HP number on a car has a lot less impact than most people realize.

A car with a lower peak HP but a larger overall avg will perform much better.

Performance will also be greatly impacted by the overall gearing which includes the size of the tires.

 

[wcorey]

I had posted those links. And it’s my belief that there’s very, very few Model 3’s on the used market, relative to traditional vehicles.

Sorry for the lack of attribution. I had two choices, go back and research who said it or just reference that it was said. As for your second sentence, of course there are fewer. There are fewer Model 3s on the street relative to traditional vehicles, including Cadillac.
There are a couple of data points behind the observation though.
1) There is only one model year of Model 3. For the sake of argument I do not differentiate Model 3s sold in 2019 from those sold since last summer. All used P3Ds are from the same cohort and all put up for sale in first year of ownership.
2) I made reference to the age grouping survey some days ago. It would be impossible, if not virtually impossible, to differentiate the source of the Model 3s on the used market today against the age of the initial purchaser. My thesis is there is a disproportionate number of P3D owners in the age group indicative of people either not in the job market or not securely in the job market and that a disproportionate number of those P3Ds come from buyers who bit off more than they could chew...so to speak. What's the proportion of used P3Ds to RWD or simply non-P AWD?

 

[Southpasfan]

I know there are not many people on this thread. But all of you I think would find the book “the Big Short” fascinating.

The fate of borrowers who over extends is only part of the story. And to my mind far from the most interesting part.

The most interesting part is how the financial services industry turned an extremely boring and conservative investment class into securities so risky they brought down an entire county.

I don’t know if this does it justice, but at one point running a savings and loan limited to home mortgages was super boring - even if you did a poor job, you got your 5% return on your thousands of mortgages and if some defaulted, well you were secured so maybe after foreclosure your return was 4%.

In the lead up to 2008, instead of the boring model the mortgages were repackaged into tranches, with the “riskiest” tranche offering a better possible return (achieved by offering a lower return on others). But what this meant is that a 15% market correction could wipe out the investors in the riskiest tranche.

The thing in the book is that Lewis only found a handful of guys in the entire county who saw the risk.

 

[VQTRVA]

I know there are not many people on this thread. But all of you I think would find the book “the Big Short” fascinating.

The fate of borrowers who over extends is only part of the story. And to my mind far from the most interesting part.

The most interesting part is how the financial services industry turned an extremely boring and conservative investment class into securities so risky they brought down an entire county.

I don’t know if this does it justice, but at one point running a savings and loan limited to home mortgages was super boring - even if you did a poor job, you got your 5% return on your thousands of mortgages and if some defaulted, well you were secured so maybe after foreclosure your return was 4%.

In the lead up to 2008, instead of the boring model the mortgages were repackaged into tranches, with the “riskiest” tranche offering a better possible return (achieved by offering a lower return on others). But what this meant is that a 15% market correction could wipe out the investors in the riskiest tranche.

The thing in the book is that Lewis only found a handful of guys in the entire county who saw the risk.

Great movie too.

 

[KenC]

Gotta watch it sometime. The idea of CMOs, or collateralized mortgage obligations, is that when you pool high individual risk, you lower the total risk, thus the return is disproportionately high for the pooled risk. That's why investors liked it. It's the same insight that Michael Milliken had in the mid-80s. The problem in the oughts is that the appetite for these low-grade CMOs was high, and the supply was limited, so the mortgage brokers started to bring lower and lower quality mortgages, far below the historical norms, in order to satisfy the demand from Investment Banks. This wasn't readily apparent to the ratings agencies or obviously, investors. Some people knew it, obviously. If it had been better understood, ie, that the collateral quality had decreased, the increased risk would have been priced into the securities, but they weren't, and thus the Big Short.

Fundamentally, people are greedy, and that gets us into trouble from time to time.

I know there are not many people on this thread. But all of you I think would find the book “the Big Short” fascinating.

The fate of borrowers who over extends is only part of the story. And to my mind far from the most interesting part.

The most interesting part is how the financial services industry turned an extremely boring and conservative investment class into securities so risky they brought down an entire county.

I don’t know if this does it justice, but at one point running a savings and loan limited to home mortgages was super boring - even if you did a poor job, you got your 5% return on your thousands of mortgages and if some defaulted, well you were secured so maybe after foreclosure your return was 4%.

In the lead up to 2008, instead of the boring model the mortgages were repackaged into tranches, with the “riskiest” tranche offering a better possible return (achieved by offering a lower return on others). But what this meant is that a 15% market correction could wipe out the investors in the riskiest tranche.

The thing in the book is that Lewis only found a handful of guys in the entire county who saw the risk.

 

[Camera-Cruiser]

More back on track, however interesting one's mortgage obligations or lack thereof, is how much depreciation will befall ICE cars during the transition? It appears that BMW if falling all over itself to transition to electric. Who wants to own the last ICE version of any particular model? Do you want the last ICE BMW 5, 6, or 7 series? Maybe. But what about a Ford F150? or Chevrolet Corvette? I don't want to be holding that bag. The whole industry/market is going to get wake up call. Should be fun.

10 years from now are gas stations (selling gas/diesel) going to harder to find? I imagine that they will leave inner cities and suburbia first as more people will be charging instead of filling up. Imagine having to "drive" to the highway filling station instead of the local corner.

It will happen, and it will hammer resale - who wants a dinosaur?