Model 3 immediate resale value

[smartypnz]

You may dream of profiting, but the Feds require a year ownership (California 30 months - Monterey County 36 months). That would be a total hit of up to $12,500. That lowest sticker $35,000 which potentially could have been $22,500 now will become extremely expensive to a prospect.

Also, the way the Fed is written it says 200,000 qualifying vehicles are sold - if the car is flipped, it no longer is a qualifying vehicle and shouldn't count. Just sayin'.

 

[Sonny Daze]

There is a lot of talk of how the tax credits affect this situation, but if someone buys a car for $50,000 (plus any sales/excise/transfer tax) and sells it for for $60,000, they will make money, regardless of any missed tax credit.

There may not be any takers, but I would guess there will be a few daddys out there who will fork over that money to buy their little girl the car she really, really, really has to have.

 

[ItsNotAboutTheMoney]

Hello, assume someone with an earlier reservation number receives their model 3 in late 2017. Wouldn't the car's value immediate appreciate upon delivery? Considering demand will be greatly backed up what do you think a 50k model 3 would sale for if the owner immediately put it on the market?

Might be worth more, but only to a limited set of buyers. Not only would the buyer and seller not be entitled to the Federal tax credit (so the seller would be taking a chance if they tried to claim it), but early Tesla reliability has been poor, so the buyer would have to be desperate to get into a Model 3 sooner, be willing to deal with reliability problems yet also not caring about a huge chunk of margin going to a private buyer rather than Tesla.

 

[3s-a-charm]

In Canada we don't have a Federal Tax Credit so in Canada I suppose we would have additional value day 1 on a Model 3

 

[shrspeedblade]

What car with this production volume has ever gotten a 30% markup? Does not make sense.

What other car has received nearly half a million deposits over a year before the first one roles of the line, many of them almost two years before?

 

[zenmaster]

What other car has received nearly half a million deposits over a year before the first one roles of the line, many of them almost two years before?

Focus. The whole point is resale value in a market where they make as many as market demands?

 

[shrspeedblade]

There's this thing called patience, which some people lack in this day and age and are willing to pay a premium to get something NOW even if they can get it for less a bit later.

There's also this thing called good manners, which some people lack by saying "focus" to someone like they're a rambunctious child simply because they have a difference of opinion. Some people lack that, too.

Mic dropped.

 

[Red Sage]

What car with this production volume has ever gotten a 30% markup? Does not make sense.

Only 30%...? Heh. You must not have come across the worst of the worst in stealerships.

Things got so bad with the Dodge Hellcat that the manufacturer instituted a maximum markup of 'only' $8,500 last year. Of course, that was only after it had been marked up through a bidding process through multiple 'independent franchised dealerships' across the nation. No, the stealerships never explained to their Customers that sure, they'd take their deposits, and the more they could give, the sooner they would get their car -- oh, but we've got 25 guys in line ahead of you and this location only gets, like, four of the cars per year. Still, it wasn't quite as bad as some folks thought...

Someone in Orange County California was requesting a $100,000 markup over and above the ~$140,000 MSRP on a BMW i8.

Multiple stealerships were asking between $32,000 and $40,000 for the original Mazda Miata upon its initial release, saying it was, "What the market could bear." That car had an MSRP of $13,000.​

 

[Red Sage]

You may dream of profiting, but the Feds require a year ownership (California 30 months - Monterey County 36 months). That would be a total hit of up to $12,500. That lowest sticker $35,000 which potentially could have been $22,500 now will become extremely expensive to a prospect.

Also, the way the Fed is written it says 200,000 qualifying vehicles are sold - if the car is flipped, it no longer is a qualifying vehicle and shouldn't count. Just sayin'.

The tricky part is that for traditional automobile manufacturers, they consider a car 'sold' the instant it leaves their factory bound for a dealership lot. They don't wait until the dealership, or the end user takes possession. Tesla does not consider any vehicle sold until they make Delivery to the end user. The IRS relies upon the report from the manufacturer as to when cars were sold. So, yeah, especially with so many international Customers, Tesla can make sure that their 200,000th vehicle for a US Customer is Delivered on a particular date at the very beginning of a Calendar Quarter in order to maximize Deliveries at the full potential Federal Tax Credit level over the course of six months before the phaseout begins.

 

[Red Sage]

What car with this production volume has ever gotten a 30% markup? Does not make sense.

I replied before, but just noticed the qualifier 'with this production volume'... My previous examples, Mazda Miata, BMW i8, and Dodge Hellcat, have never been built in quantities to approach even 100,000 units per year, let alone 500,000. So that is a point in your favor.

But really? Let's be honest here... If not for Corporate Average Fuel Economy (CAFE) requirements, Dodge would drop a supercharged gas guzzling HEMI V8 in EVERYTHING they build through the entire product line. The only reason the Hellcat is a limited production vehicle is to prevent the company from paying GIGANTIC fines to the Federal government along with potentially being banned from the Great State of California. Because an ICE motor that runs like that has exactly ZERO hope of being (honestly) classified with either Zero Emissions or High Mileage status -- EVER.

And no matter how ubiquitous a vehicle may be, if it is popular, you are much more likely to see markups by 'independent franchised dealerships' than you will ever see discounts on them. If they don't laugh you out of the building when asking for a 15% discount on a brand new Accord or Camry, they'll certainly put on their 'Concerned Fatherly Advice' cap and gently explain that there is 'no way' you will get that much off from anyone, anywhere. Then they'll steer you toward the $22,000 version of the car that has $750 worth of dealer applied optional equipment that is offered for the paltry sum of 'only' $35,000 and allow you to 'beat them down' to a mere $30,000 plus tax, title, license, destination, and a 'little extra' to cover dealer prep and shop supplies.

30% markup is NOTHING to a determined salesman that has hooked an unwitting prey.

 

[ModelNforNerd]

I replied before, but just noticed the qualifier 'with this production volume'... My previous examples, Mazda Miata, BMW i8, and Dodge Hellcat, have never been built in quantities to approach even 100,000 units per year, let alone 500,000. So that is a point in your favor.

But really? Let's be honest here... If not for Corporate Average Fuel Economy (CAFE) requirements, Dodge would drop a supercharged gas guzzling HEMI V8 in EVERYTHING they build through the entire product line. The only reason the Hellcat is a limited production vehicle is to prevent the company from paying GIGANTIC fines to the Federal government along with potentially being banned from the Great State of California. Because an ICE motor that runs like that has exactly ZERO hope of being (honestly) classified with either Zero Emissions or High Mileage status -- EVER.

And no matter how ubiquitous a vehicle may be, if it is popular, you are much more likely to see markups by 'independent franchised dealerships' than you will ever see discounts on them. If they don't laugh you out of the building when asking for a 15% discount on a brand new Accord or Camry, they'll certainly put on their 'Concerned Fatherly Advice' cap and gently explain that there is 'no way' you will get that much off from anyone, anywhere. Then they'll steer you toward the $22,000 version of the car that has $750 worth of dealer applied optional equipment that is offered for the paltry sum of 'only' $35,000 and allow you to 'beat them down' to a mere $30,000 plus tax, title, license, destination, and a 'little extra' to cover dealer prep and shop supplies.

30% markup is NOTHING to a determined salesman that has hooked an unwitting prey.

In my experiences with stealerships, it's usually the financing where the number 30% pops up....at least in Virginia outside of military bases.

 

[smartypnz]

200,000....... what if a Mfr changes it to a different model? Say right around 190,000.

 

[NOLA_Mike]

200,000....... what if a Mfr changes it to a different model? Say right around 190,000.

The 200k applies to the manufacturer - across all model lines.

 

[zenmaster]

I replied before, but just noticed the qualifier 'with this production volume'... My previous examples, Mazda Miata, BMW i8, and Dodge Hellcat, have never been built in quantities to approach even 100,000 units per year, let alone 500,000. So that is a point in your favor.

That was my whole point it still stands. Simple supply and demand. Folks this is not that hard to understand.

 

[mrtian97]

I actually saw someone advertise in Craiglist for this , they are expecting 7-10% markup

 

[JoeCoolMan24]

According to https://www.irs.gov/pub/irs-pdf/i8936.pdf:



Doesn't really say anything about if you originally planned to use it and then decided to sell within the same year, as far as I can tell.

Do you or anyone else knows what happens if 2 names are on the title? I don't make enough money to qualify for the full tax credit, so I was thinking about adding my dad's name to the title to allow him to claim the full credit, then he would just pay me back that money from his tax return.

Or would he have to buy it, and then he could "sell" it to me for $1 after the first day, and then he claims the full credit and gives it to me?

 

[Red Sage]

That was my whole point it still stands. Simple supply and demand. Folks this is not that hard to understand.

And my point is that no one should underestimate the inherent greed of stealerships. They will DEMAND to get a substantial cut of any transaction they can convince a victim to accept. Thus, 30% is not out of the question at all. I know of someone who effectively paid $35,000 for a Nissan Sentra -- in 1987. Yes. Two years before there was an Infiniti M30.

 

[Adrien]

My two cents (because I thought about doing this) is that there will be a slight interest level, maybe 7-10% profit for the first few months. The problem is that it will only be the highly speced cars and at that point if you have the money, just grab a model S. It's going to be a better car unless size is an issue. I will qualify to have one fairly early on, Max spec, California, early in line, but for the limited profit PLUS the tax credits it just won't make sense to give up the car and wait for another one for over a year for less than $9-10k...that I think is my break down point. $5k isn't worth it to wait another year for me.

 

[tamtam28]

If your're trying to speculate, much easier and lower risk to sell your reservation spot and allow the new buyer to configure car to their liking and apply for the tax credit themselves.

 

[BluestarE3]

If your're trying to speculate, much easier and lower risk to sell your reservation spot and allow the new buyer to configure car to their liking and apply for the tax credit themselves.

Reservations, by and large, are not transferable.