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Losing enthusiasm for Model 3
- Thread starter igotzzoom
- Start date
You confirmed that you do not understand how leasing work. You do not understand what a residual value is. I gave you a $300 a month estimate. It doesn't matter if you borrow money for 12 months or 84 months. What matter is the APR and in today's interest rate world it's negligible. This isn't 1980 anymore.
If you understood leasing you would understand my example. I won't bother doing anymore calculation since your mind is made up anyway.
The last thing I want actually is a guy like you delay the order of a tesla fan.
I will let you enjoy your new $40k Volvo SUV for $600 a month or whatever. And of course enjoy the free $200 savings in maintenance. We all know how maintening a brand new car for the first 30,000 miles or so can get very expensive!
Side note: I am actually quite confused as to what you are doing in a tesla forum talking about Volvo SUVs (a rather odd comparison). You may want to clarify what your intent is because I am not following (and I don't think I am the only one)
Well, leasing works for me in that I prefer a lower monthly obligation for use of maximum car with the option to jump into a new car every 3 years (or less). This is where all-inclusive car subscription services are going to be very appealing as they become available from more manufacturers and competitive.
Happy to oblige on my background! I'm an ex-Tesla Model 3 Early Morning Day 1 Seattle reservation holder who originally envisioned snagging a $35k Tesla for the price of a decently optioned Civic (after full federal tax credit) and became less enthused with the Model 3 after every reveal and estimated delivery delay. Straw that broke the camel's back for me was sorta 2-fold - 1) actually getting to spend a few hours with a $49k+ Model 3 in January and subsequently thinking that it was fairly underwhelming/not as nice as some comparable ICE $49k luxury cars I've been in, and 2) the final delay I received last month pushing me to early 2019. I'd still like to see Tesla succeed and am interested in seeing how the Model 3 ride goes for people, so I'm still here.
The Volvo came into play after I canceled my Model 3 reservation and frantically began searching for another option (Model 3 was so totally our next car for almost 2 years that I hadn't even considered looking at other cars). My wife wants a safe, AWD SUV with heated seats that'll fit 2 rear facing car seats (we can't afford an X) while I want an EV or decent mpg vehicle that doesn't suck too much gas, is comfortable, fits the car seats, and works for our city life; we've compromised on the Volvo barring a disastrous test drive.
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Your understanding of finances is very poor but it's your money.
1.) Your payments are off MSRP, no room to haggle.
2.) Your $600-700 is for a minimum of 2 years that resets your term once you upgrade. How much equity do you get at the end? 0
3.) Bundled insurance is good until you find out you can get it cheaper and/or lose multipolicy discounts elsewhere.
4.) All-inclusive packages are a way to snake people bad at numbers. You eat vehicle depreciation no matter how its sliced.
With that said.. I change my iPhone every year. However the difference between our "all-inconclusive" subscription services is
One is a a phone and not a $45,240 MSRP car.
Part of what helped getting into an X is driving a Mazda 3 for 9 years and an Accord for 7 years with zero money spent on leases.
I'm sure you know better, but a hypothetical myself in your situation would just be buying a used car if I was going to wait for what Tesla has 2 years from now than throw 17,000+ on a Volvo lease (or sucker care).
I wonder how close $17,000 would be to the actual depreciation value of a $40,000 (buyers pay less than MSRP) vehicle. And you are paying that in 2 years instead of 3.
EDIT: Wow the more I think about it my mind keeps getting blown on how hilariously bad the Volvo deal is in comparison!
As a general idea:
$49,000 - 7500 = 41500 over 3 years and Model 3 free and clear.
$17,000 to Volvo over 2 years = 0
$49,000 - 7500 - 17000 (given to Volvo) = 24,500 remaining after 2 years.
So - pay Volvo $17,000 and get nothing. Or only owe 24,500 after 2 years to own a Model 3 straight up. And owning the SWEET Model 3 with the long range battery and glass roof!
I think I would be begging Elon for my place back in line.
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Good analysis, except I think it will likely be less than $45k in 2 years. Remember $60k is at most $52.5k after tax rebate, maybe $50k or less depending on what state you're in. Lose only $5k in 2 years? No way. Cars lose around 40-50% of value even in 2 years. EVs are evolving rapidly. In 2 years news will be out about the model Y and its improvements. Used Model S will be that much cheaper. Lots of other EVs. Battery prices dropping. LR may eventually become standard for close to $35k as battery prices come down.
Given 52k if 40% loss (figuring high side of resale value), you're at $31.5k in 2 years. Much lower than 45k. The end result may end up somewhere in between.
The tax rebate is about to end. Not people many people will get the rebate. Depreciation will be assumed at the full price....
and ...
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It's a $60K Tesla and not a $52.5K Tesla once the tax rebate is gone.
$40K is what I believe to be value after 2 years. We will see what the lease residuals look like.
$45K might be optimistic but $31.5K is nothing for a car like this.
No one will sell their LR PUP Model 3 for $31.5K after 2 years under ordinary circumstances.
Wow, now here is another man who gets it. Also nice graph but I didn't need to see it or crunch numbers. Common sense would of determined that 50% depreciation was economically impossible.
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According to this analysis the 2nd year depreciation for the 3 series BMW is 34% and 3rd year is 50%
BMW 3 Series Depreciation
BMW 3 Series Depreciation
Garlan Garner
Banned
Who cares about depreciation or rebates or anything of the kind when "like me" you keep your cars for 15 years? lol
INTERESTING... not often do I see that kind of commitment to ownership I would say the Model 3 is the wrong car for you if you are ok with technology getting outdated.
Model 3 has one problem that can't be fixed even after 15 years. Vehicle dimensions. S is more utility overall for most people.
If you got a 5 year old Model S as an example, you would pay less than a Model 3 and have a bigger car, AWD, etc.
You get some of the rebate passed on to you indirectly.
Inside the next 15 years you could change to whatever Tesla offering you wanted and get something newer than the current 3 and you get to enjoy the S now.
People who buy Tesla's own two cars while though who lease them get three cars with no equity (due to terrible lease structure). Those who can buy older cars once the greatest depreciation hit has arrived, they can own even more of them for the same amount of money over a long period of time.
I believe Tesla and possibly other evs will be the smartwatch of cars.
A smartwatch you can wear for a year or 2 a citizen or Rolex you'll wear longer.
Asymmetry
Member
Im in this camp.
Numbers for me dont stack up for a Model 3. Here in Australia there is a 33% luxury car tax that model 3 will be subject to. I like to see if Tesla can configure a M3LR just under this bracket. I doubt it.
I'm looking at a subaru Levorg at this stage. I pay more in Road tolls than fuel costs on my daily driver. also more expensive car means higher insurance premiums. What botheres me is that here we dont have a "right to repair". At least with Subarus they are like lego, break something easy and cheap to DIY.
Still love to have a model 3 but to me look like I'll wait that much longer.
dgpcolorado
high altitude member
That has been my strategy in the past, I kept a previous car for 25 years until I hit a deer and destroyed it.
However, things may be different for a Tesla because out-of-warranty repairs can be expensive and there aren't any independent auto shops that can do the work, at present. There are also some unknowns: will the battery still have a useful range at fifteen years? Will replacements even be available for such an old car? At what cost?
Add to that rapidly changing technology in the EV world and expecting to keep a Model 3 that long becomes quite a leap of faith. I suppose we will find out in fifteen years!
The repair cost to keep a Tesla on the road will make it very hard to drive your Tesla for 15 years. Tesla is trying to keep parts and repairs to themselves. Then there is the battery pack that will not last 15 years.
X Fan
Active Member
Currently, I agree.
However, if there are millions of 3's on the road 10 years from now, I don't doubt that there will be a robust secondary market.
Maybe. GM and others (perhaps even Tesla) are lobbying Congress as we speak for an extension.
It could end on schedule, it could be extended. GM and Tesla both have good arguments that they invested heavily in EV tech while others used the money for more profitable ICE programs. Toyota/Honda/etc cough cough.
To effectively punish those who took losses to advance the technology and acceptance by making it harder for them to compete in the market is not in the best National Interests. The idea behind US EV development should not be Saving the African Sparrow. It should be making the US competitive in the auto industry as we transition to EVs, which is absolutely going to occur unless a superior method of propulsion than electricity is found, which is highly unlikely. H2 lost, and even then it's still EV tech.
