Model S depreciation since Model 3 launch

[zer0cool]

I follow prices of various premium/luxury and sports cars frequently, not just Tesla, and both for new and pre-owned. CPO Model S prices have significantly fallen over the last few months as Model 3 has become widely available. Model S CPO inventory has grown multiple times, likely due to people trading in for the newer car (Model 3). I think this has even accelerated since finalization of the M3P price.

This spring, I would not have advised people to buy pre-owned Model S's because the pre-owned prices were ridiculous. Now, I think many 2015-2016 ones are great buys. Like honestly I think for many Model S's the depreciation since this spring is 10-20k.

 

[PhilDavid]

Plus their new CPO policy of not transferring CPO cars out of California is going to further add to the depreciation as a large percentage of the CPO fleet now becomes less desirable to non-California residents due to an extra tax of as much 10%.

The depreciation curve I see is that for the first 5-6 years you can expect a drop in value of about 50% every 2.5 to 3 year segment of time. In other words, the same as the typical depreciation for any other premium car.

 

[Tforme]

Used MS values have plummeted in the last few months. Probably due to the large # coming off leases AND the availability of new Model 3’s for the same or less money.

Tesla currently has over 1400 used MS in inventory, some at very attractive prices, and many with price reductions occurring almost daily. They’re probably anxious to get most of this inventory off the books by end of year. So further price reductions are likely in store for December. Great time to buy a used MS - not such a great time to trade or sell one.

 

[PhilDavid]

Used MS values have plummeted in the last few months. Probably due to the large # coming off leases AND the availability of new Model 3’s for the same or less money.

Tesla currently has over 1400 used MS in inventory, some at very attractive prices, and many with price reductions occurring almost daily. They’re probably anxious to get most of this inventory off the books by end of year. So further price reductions are likely in store for December. Great time to buy a used MS - not such a great time to trade or sell one.

They would have already sold half of those CPO cars if they would sell them with quality standards and offer the cars at a set reasonable price with price adjustments down rather than play this weird reverse auction game they are playing. Most CPO inventory cars receive daily or weekly price discounts and after a while, the price suddenly goes up by tens of thousands to start the downward journey once again. If someone did not buy a car for a certain amount, the reason it did not sell is not because someone wanted to pay tens of thousands more

These games they play with prices along with no longer transferring cars out of California ends up costing them revenue and causing steeper depreciation needlessly.

 

[Tforme]

Nobody in their right mind would put down a $2500 non-refundable deposit and commit to the purchase without first inspecting and driving a used car - yet this is exactly what Tesla requires.

I’ve looked at some pictures of several potential purchases from Tesla but from past experience I know pictures only tell a part of the story on condition. Like any random group, maybe 10% of the cars Tesla are offering were well cared for and in nice condition - but you’ll never be able to pick that one in 10 by looking at a few fuzzy pictures. I always take the time and effort to find that extra nice used car - but that’s impossible with Tesla’s current marketing model. Just look at the endless number of posts here from potential buyers who were totally turned off by the experience.

 

[PhilDavid]

Nobody in their right mind would put down a $2500 non-refundable deposit and commit to the purchase without first inspecting and driving a used car - yet this is exactly what Tesla requires.

I’ve looked at some pictures of several potential purchases from Tesla but from past experience I know pictures only tell a part of the story on condition. Like any random group, maybe 10% of the cars Tesla are offering were well cared for and in nice condition - but you’ll never be able to pick that one in 10 by looking at a few fuzzy pictures. I always take the time and effort to find that extra nice used car - but that’s impossible with Tesla’s current marketing model. Just look at the endless number of posts here from potential buyers who were totally turned off by the experience.

I bet more than 50% of cars returned by the original owner are in great condition, as otherwise the original owner or lessee would be charged extra for all the damage.

Perhaps most of the trashing and damage we see in CPO cars had occurred when the CPO fleet was used as rental loaners. I've seen posts here about people being asked to return their loaner because someone bought the car so we know this happens.

 

[kaidou]

Nobody in their right mind would put down a $2500 non-refundable deposit and commit to the purchase without first inspecting and driving a used car - yet this is exactly what Tesla requires.

I’ve looked at some pictures of several potential purchases from Tesla but from past experience I know pictures only tell a part of the story on condition. Like any random group, maybe 10% of the cars Tesla are offering were well cared for and in nice condition - but you’ll never be able to pick that one in 10 by looking at a few fuzzy pictures. I always take the time and effort to find that extra nice used car - but that’s impossible with Tesla’s current marketing model. Just look at the endless number of posts here from potential buyers who were totally turned off by the experience.

FYI, if the damages/defects are not disclosed by those photos, Tesla will fix it upon the request.

 

[kaidou]

I bet more than 50% of cars returned by the original owner are in great condition, as otherwise the original owner or lessee would be charged extra for all the damage.

Perhaps most of the trashing and damage we see in CPO cars had occurred when the CPO fleet was used as rental loaners. I've seen posts here about people being asked to return their loaner because someone bought the car so we know this happens.

Yes, I received extremely well taken-cared car although it has more than 40k mileage on it. If the car is in trashy condition, it should be disclosed in the photos so that the potential buys can avoid!

 

[Eevee]

Nobody in their right mind would put down a $2500 non-refundable deposit and commit to the purchase without first inspecting and driving a used car - yet this is exactly what Tesla requires.

Well, first off the deposit is transferable to another car if you change your mind on that one. The legalese states that you only have 72 hours but I got the impression it would be transferred well after 72 hours. I even got the impression that if you just carried yourself well and calmly and reasonably demanded a refund then you'd get one. I feel like the $2500 deposit is just to weed out the non-serious shoppers. I can't say for sure though because I liked my car and paid the rest to buy it

Indeed, some people have explained how they got their deposits back or transferred them to other cars: Deposits refundable?

 

[Tforme]

Yes the deposit is transferable. But the Tesla rep stated emphatically that it is not refundable - but I know we have heard of some instances here where it was.

Pictures sent to me of a supposedly “very nice” 10,000 mile 85d for $59k.

 

[reserves]

Thread has gone off topic.

 

[Tforme]

I guess my real beef is that Tesla won’t let you “walk the lot” of the used cars and immediately pick out the ones you’re interested in - a process that every other used car dealer happily encourages.

A Tesla center near me keeps dozens (maybe many more) of used Tesla’s on a leased lot near the service center but won’t allow any preview of them without committing to “purchase” first. I may very well find one I like and buy it on the spot. But I won’t go thru the ridiculous process of buying it sight unseen.

 

[Tforme]

Thread has gone off topic.

Yes it has. My apologies.

 

[reserves]

With the Model 3 finally arriving in Europe (though not in the UK as we drive on the right)

I’d be interested if there’s any update on pricing of used Model S

Are there significantly more used Model S available due to owners trading in for a 3?

I’ve been looking on and off since reserving a model 3, interested of anyone snatched a CPO Model S that have been looking for a long while?

 

[PhilDavid]

View attachment 356088 View attachment 356089 View attachment 356088 View attachment 356089 View attachment 356088 View attachment 356089 View attachment 356088 Yes the deposit is transferable. But the Tesla rep stated emphatically that it is not refundable - but I know we have heard of some instances here where it was.

Pictures sent to me of a supposedly “very nice” 10,000 mile 85d for $59k.

Wow that car looks like it came from a junkyard! I'm not sure how they can sell a car in such awful condition with straight face.

Wait, they told you the car is "very nice?" Who sold it to you. Was it Borat?

 

[dom1980]

Hi,

I am considering buying a new 75D out of inventory here in the UK. As Tesla has stopped making the 75D how do you think this will affect its resale value in the coming years?

As it is the latest gen 75D which is now being phased out could it attract a scarcity value? But on the other hand i am wondering if it will compete with the Model 3 in a few years time (esp range wise, interior space similar) and hence its value might be affected by that.

Interested in hearing your thoughts. Thanks

 

[IanMcL]

Free supercharging for life is enough to keep the S value in place.

 

[Tforme]

Free supercharging for life is enough to keep the S value in place.

Apparently not. This car has lost 40% in only 15 months. That’s a staggering $45,000 in depreciation. The articles claiming Model S retains its value well are just not reflective of what’s currently happening. Over 2,000 used and CPO Model S now on the market is really depressing resale values.


Model S / 2017 / Blue - 37c71 | Only Used Tesla

 

[reserves]

The Model 3 has just been released over here in the UK due to be shipped in the next few months.

Will be very interesting to see how it affects used Model S pricing.

Currently an 2015 85 is about the same price as a new Model 3 SR+

How is the used market for the S compared to a new 3 in the states?