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Model S Depreciation significantly higher than expected

Discussion in 'Model S' started by Jdcleary, Jul 4, 2015.

  1. Jdcleary

    Jdcleary Member

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    #1 Jdcleary, Jul 4, 2015
    Last edited by a moderator: Jul 5, 2015
    My Model S listed at $89, 820 and with the Federal Tax Credit of $7,500 the net cost, excluding Sales Tax and License, was $82,320.

    The car will be 28 months old on July 10th and has 54,000 miles. My Tesla trade-in quote was $37,000 meaning the Model S has lost 55% of it's value.

    Will my Model S trade-in be valued less than $30,000 when my Model X becomes available in March?
     
  2. jeffro01

    jeffro01 Active Member

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    What are the details of your car? S60?

    Until I see the details of your car, I won't get into whether or not I think that level of depreciation is warranted or not.

    Oh and try a smaller font?

    Jeff
     
  3. eloder

    eloder Member

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    I've heard many reports of a Model S holding resale value even above that of comparable gas cars.

    I think you'd find many, many people who'd buy your car in a heartbeat for well above $37k.
     
  4. igotzzoom

    igotzzoom Member

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    Bad for current Model S owners, but great for anyone wanting to buy one used!
     
  5. LargeHamCollider

    LargeHamCollider Battery cells != scalable

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    What Jeff said, also it's well known that Tesla low balls trade in value significantly, better to sell it yourself.
     
  6. cottylowry

    cottylowry 2013 Model S

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    I believe I did the first private party used Tesla sale in Minnesota. When I registered it for plates and tax, the State of MN had never heard of Tesla -- this was in March 2015. The car came from S California. Naturally the sale occurred because of an upgrade to the 85D.

    It's fully loaded, with 21K miles -- It's still on this website and shows the sale price as $500 because we changed Panjo to be used for the deposit so you can find it if you try. Anyway, long story, shortened, Tesla had offered the seller 57K, and Cars.com or some website had offered him $61K and he asked $66K on this site. I paid full price and felt it was an excellent, deal, very fair for both the seller and me. It ended up being a great deal because he had added a bike rack, center console, additional 4 yr warranty, rear deck and probably other stuff that I cannot remember. This site is a wonderful resource for getting a great car from an enthusiast and I heartily endorse buying your car from someone here.
     
  7. smilepak

    smilepak Member

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    Well first you lost value due to higher miles. For two years old car it should be at most 30k miles to retain the value set by tesla. Any miles above will run significantly deducted in values.
     
  8. AmpedRealtor

    AmpedRealtor Active Member

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    I'm not sure you can point to a trade-in value and cry about loss of resale value. Check the private party sale value, that's where it's at.
     
  9. omarsultan

    omarsultan Active Member

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    Speaking from experience, high milage will kill you every time. In the CPO market, there are likely cars similar to yours with lower mile, so its going to put additional pricing pressure on your car.
     
  10. SmartElectric

    SmartElectric Active Member

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    #10 SmartElectric, Jul 4, 2015
    Last edited: Jul 4, 2015
    I sympathize.

    That said, I did recently benefit (cost-wise) from purchasing a used Tesla with high mileage, so I do have some personal experience in this matter.


    OP car : Model S Res. #13,967, non-perf, 85KWh, Pearl White, Black Leather, Piano Black, 19", Pano, Tech, Air, twin chargers
    Trade in : $37K for car that retailed $82K.


    Tesla formula for inventory cars is $1 per mile and $1000/month.
    28 months = reduce by $28K
    56000 miles = $$$$$

    Ok, so that won't work, now compare to CPO:
    Tesla CPO Consolidator

    P03368 sold for $55K with only 29K miles. That's almost half the miles of your car.

    Tesla spends thousands refurbishing CPO cars with high mileage, I should know, my CPO had high mileage, they replaced the brakes, tires and UMC for starters!

    Tesla are offering you what they need in order to bring your car to "as new" state for CPO sale. You don't have to take the trade in, but at least know that IMHO it is fair and reasonable for a car already out of warranty that will need to be resold with the 4 year CPO warranty with the new owner expectation of nearly new condition.

    Here is a quote from you elsewhere on the forum:
    Fuel savings is a benefit of driving an EV, however, it should be clear that depreciation scales with miles on a car, any car, Tesla or other.
     
    • Funny x 1
  11. brianman

    brianman Burrito Founder

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    Is the giganto font size really necessary?
     
  12. Krugerrand

    Krugerrand Active Member

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    It's great! I can read the post from across the room withOUT my glasses.
     
  13. eye.surgeon

    eye.surgeon Member

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    FYI, a single low-ball trade-in offer does not equal the retail value of your car. Sell your car on the private market or get a fair offer in trade, then report back.
     
  14. travwill

    travwill Member

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    I think another factor that goes along with those shopping for Teslas is the education that earlier VINs have often are considered to have a lesser quality build (not that they are bad/horrible by any means). Improvements every week have been made, fit of panels, interior quality/solidness, batter pack improvements, and a few standard features has improved over the last couple+ years since introduced - and any of the standard RWD models were hit hard more with the introduction and standard offering of AWD models now. Just yet another factor in those first couple years heading down faster...
     
  15. S4WRXTTCS

    S4WRXTTCS Active Member

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    Whatever happened to the resale guarantee value? I was shown the resale guarantee value, but what about the OP?
     
  16. rocketdallas

    rocketdallas Member

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    If I remember correctly, it is offered with certain mileage parameters through partnered financing, which the OP exceeded. I do too much driving each year (25k mi.) and so it doesn't apply to me also. I think everyone stated it well already: large luxury cars depreciate heavily in the first couple of years, especially with high mileage, and trade-in offers are usually low so the other party may insert some amount of profit margin when they flip your car, unless it is a rare and highly desired car.
     
  17. jerry33

    jerry33 S85 - VIN:P05130 - 3/2/13

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    Right now there are a lot of used Model S available due to owners trading in or selling to get the D models. This happens with every popular car after a major upgrade. In a few months prices will rise again.
     
  18. MsElectric

    MsElectric Active Member

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    Buy any premium car that cost around $80,000 and put over 50,000 miles in just 2 years and don't wonder why the trade in price for the car is only about $40,000. You have put such a huge amount of miles on your car that some potential buyers will not even look at the car unless it is offered with a huge discount.

    You've saved a bunch of money on gas so add those savings to what Tesla offered you. Or you can try to sell the car on your own but you are going to have a really hard time finding a buyer for a car with that many miles. I assume with over 50K miles your car is now out of warranty. Tesla has already sold some used cars for the mid to late 40s and that might be all they can get for your car. They will likely spend about $5,000+ reconditioning your car as needed and adding additional 4 years of warranty coverage. You add about another $5,000 in profit and that's likely how much they will sell your car for.

    Tesla has bought some Model S cars at a loss based on some reports here on what people received for the cars and what Tesla ended up selling the cars for and I'm glad Tesla is not subsidizing for someone else's depreciation as that is unsustainable. Trade in prices are always going to be on the low end as they are pretty much at wholesale level or even less but if you don't like the price Tesla offered you sell on your own.

    Model S vehicles are holding their value better than an S class so your title for this thread isn't entirely correct. May I suggest the title:

    "Over 50,000 miles on a two year old car causes significant depreciation."

    - - - Updated - - -

    Resale value guarantee isn't a mythical program to absolve an owner's responsibility to pay for depreciation :) When you own a car it depreciates based on time and mileage. For premium cars, excessive mileage causes significant depreciation.
     
  19. jerry33

    jerry33 S85 - VIN:P05130 - 3/2/13

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    The problem is the same one that you have with potato chips: "I'll bet you can't drive it just once".
     
  20. MsElectric

    MsElectric Active Member

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    The only caveat is that you have to pay for the potato chips you eat, or the miles that you drive :)
     

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