Model Y now unaffordable for most of us

[240vPlug]

The market will figure this out. Right now Tesla has insane demand especially for MY. Because demand is high Tesla can and is charging a premium for the vehicles and the lack of federal credit isn’t hurting them (though it may hurt consumers). While I love Tesla I think they will have a lot of new competition in the next five years which may affect demand.

On a side note every car maker is charging more. Its just that the mfr isn’t raising MSRP. The dealers are adding “protection packages” or charging “market adjustments”.

Inflation and COVID shortages are to blame mostly. Sometimes i think they are all just using it as an excuse to gouge consumers.

 

[thesmokingman]

Having been around here for a while, and noticing that this OP joined TMC to make this post, then logged off shortly after, it will be interesting to see if they ever log back in again. I am betting either they never log in again, or that they never really post again.

This feels like a (for want of a better term) "Lets get conversation going" post by the OP.

You guys need an IP check...

 

[Hexo09]

Everybody blames "inflation" for vehicles being expensive and that's true but there's one other factor. That factor is that consumers now look at a car's monthly loan payment and not the purchase price. If a loan can fit into the purchaser's monthly budget, it's a go.

The same reason why the average American has $6k in credit card debt but most have less than $5k in an emergency fund… Yolo!

 

[Kairide]

The model 3 was never 30k and where was this sub 40k model Y? The absolute cheapest model 3 SR was 35k, only really available off menu, and only for a short period of time.

I understand the point you are making, but those are some fairly large exaggerations.

You’re right that Tesla never released a $30k Model 3, it was $35k. I was off on those numbers.
In February 2021 the SR Model Y was $39,900.

With all due respect, as a moderator you are very good at trying to stir the pot with your comments rather than accepting different points of views in this thread at least. Your first response in post #10 was very accusatory towards the OP of their true intentions and not very welcoming towards a new member.

My numbers on the Model 3 were incorrect, but the Model Y was spot on. By claiming I’m making fairly large exaggerations to get my point across is incorrect and again accusatory of what my intention was. I made an error, but overall they were not large exaggerations.

 

[Lloyd]

Shut up and take my money!

 

[Kairide]

We’ll since I have an S and have a Model Y on order that statement is true.

 

[tbcboo]

Some of these responses with people getting so defensive is almost comical, yet sad. I enjoy Tesla and all, but too much of any Koolaid isn’t good. OP was invested in wanting to get a Tesla but prices kept rising. I’d be bummed too if I felt priced out of a car I thought I would be buying and had been researching. Lots of people are on this forum before purchase and lurk.

The average annual salary in 2020 for those in the US was $56k. If those people are buying $60k+ cars then somebody help them. But to those saying “most” CAN afford a Tesla these days, it doesn’t sound statistically correct.

 

[TSLY]

Owned a Chevrolet volt since 2013, waiting for a Tesla I could afford. Followed all of the cost reductions in the batteries and structure only to see one price increase after another, including the deletion of lr rwd on model y making it a 60,000 car. The loss of federal tax credit of 7500 did not help, Musk’s reply to this is Tesla doesn’t need it, my reply is I did. Many comparable suv’s coming out, ie ioniq5, ev6 and q4 15-20000 less expensive. I considered Musk the Henry Ford of the ev, but I must say adios because he has left me behind.

Feel ya bro. There's an old adage in poker. Don't play at a table you can't afford.

 

[zpaul]

Everybody blames "inflation" for vehicles being expensive and that's true but there's one other factor. That factor is that consumers now look at a car's monthly loan payment and not the purchase price. If a loan can fit into the purchaser's monthly budget, it's a go.

But low rates contribute to inflation so more people tempted to buy. Raise rates to 5% and car and house sales will tank. And you’ll see discounts on cars rolling in.
Before people were financing for 3-5 years and 5 was rare but now people finance for 7 years the most depreciating asset (except for Tesla at this moment)

 

[Best_EV]

Another even more extreme example is Europe: average price for a new car in 2021 was 34k € (38k $ - all prices with sales tax as this is they way we roll in Europe). A Model Y in Germany starts at 53k € (60k $) including government grants, so it is 60 % more expensive than average new car. Being delivered since september 2021, it is already best selling BEV CUV in Q4 2021 on the german market, overtaking the VW ID4, Audi Q4 e-tron and Skoda Enyaq, all beeing domestic cars, all of them beeing much cheaper than Model Y (only etron can be more expensive, depending on the trim level). Even more dramatic are the sales of Model 3 in Germany, base M3 starts at just 36k EUR (41k $): 35.262 cars beeing delivered in 2021, 1st place among BEVs. An in Switzerland Model 3 was the best selling car of the year. Since over here average gas price is already over 1,6 €/liter (7 $/Gallon) and paying about 0,4 €/kWh on Superchargers and even way less when charging at home, this is also a huge factor. Chinese BEVs are indeed coming, but still need years to be competitive, not having their own charging infrastructure puts them in a difficult starting position.

Demand is through the roof worldwide, I could imagine Tesla would still sell all the cars, even if the price increased for another 10 % over night. Even with new factories in TX in Berlin, no price reductions are to be expected, for Europe I would even guess prices will rise, since the are the have been more ore less the same for the last 12 months. Lower cost of 4680 batteries will only be a cost advantage for Tesla, they will be selling (more) cars at even more profit. Advantage for buyers will be more range (miracles are not to be expected here, my estimation is about 30 miles more range for first generation 4680 3/Y cars) and lower overall weight.

 

[DanDi58]

You’re right that Tesla never released a $30k Model 3, it was $35k. I was off on those numbers.
In February 2021 the SR Model Y was $39,900.

Yes, the MSRP was under $40k by $100. But the $1200 delivery charge puts it over. Hopefully at some point Tesla can get this mythical $25 'Model 2' off the ground but they have commitments with the Semi and CT to resolve first. Of course, there are several other under $40k MSRP EV's available now (Leaf, MINI, Bolt. Others like the ID.4, Ionic5 and MME with higher specs are all under $40k including federal tax incentives. So not sure why Tesla HAS to offer a less expensive car. Not everyone needs or has to have a Tesla....

 

[AndreP]

I have a feeling automobiles will flip from under to oversupply in the near future here, especially on the EV side. Tesla isn't alone in not being able to meet demand, other EVs (like the Mercedes EQS) are more supply-constrained and are commanding even crazier markups at dealerships.

But with manufacturers ramping up production and likely a good amount of demand pulled forward these last couple years, I won't be surprised if this reverses hard and we start seeing vehicles selling at discounts -- I'm gunning for 2023-2024.

 

[EmbersDC]

I think you are misunderstanding the point of the OP’s original post. Tesla went from having affordable models to being unaffordable. They had a $30k Model 3, and a sub $40k Model Y. But over the course of the year raised their prices by quite a large amount and got rid of their affordable Model 3 and Y. Making them unaffordable to a lot of folks in the name of profit.
It’s not like Rolls Royce or Lamborghini where it’s just for the filthy rich.

If you haven't noticed, everything has increased in price (food, groceries, wood, mechanical systems, computers, etc). This includes cars. You can't single out Tesla for increasing prices when a carton of eggs used to cost $3.99 and now it's $7.99. Again, increase in cost comes with the economy right now.

If someone can't afford it, don't buy it. A Tesla is not a need. It's a want. Or, buy a Nissan Leaf.

Tesla doesn't need to offer a low budget car. And if they try and it doesn't work now, then it doesn't work out.

 

[Destiny1701]

I dont get this type of post, especially if someone joins a website to make it. I get that car is out of reach for many, that part I get. The part I dont get is someone joining a website that is specifically for that brand to say "i cant afford it so I am going to buy X or Y".

I cant afford a maserati, but I am not going to go on forums dedicated to discussing maseratis and say 'I cant afford this car so I am going to buy a BMW or Audi".

If this OP wants cheaper from tesla, then they should be looking at a Model 3 RWD. No one "needs" a SUV type vehicle (yes, I said it, even people with kids do not NEED a SUV").

I beg to differ there buddy. The hatchback or the S and Y are fantastic for transporting anything. I had to pick up 2 snow shovels yesterday and a few other items in an M3. With seats down it was still difficult to manage. Selling 3 and a Y coming in 2 weeks.

Also the sitting angles for knees and legs is much better as seats are higher. The reclining seats are also a bonus.

I have 2 kids age 15/12 and I can tell you with 100% assurance that they both prefer a Y any day over a sedan. Also being able to reach behind and grab something from the rear at any time…or vice versa.

I guess used prices for Y SR are out of reach for the OP?

 

[leoita]

The demand is through the roof and the economy inflation is at the highest point right now
Everybody is taking loans on anything and the price barely matters. Image what's going to happen in a few years when suddenly they will not be able to keep up with the monthly payments.. And its going to happen..

 

[texas_star_TM3]

And this should be illegal IMHO, NEVER pay over MSRP. The Stealerships already make enough. Shopping through a credit union or other avenues can yield MSRP right now if you can find availability. Coworker bought a new Ice car, no markup at all last month.

the S in MSRP stands for "suggested".

also: when car sales are slow - customers demand a hefty rebate and pay UNDER msrp .... but when demand is high, the limit should most definitely be the exact same msrp they earlier acknowledged as having no meaning. Tesla doesnt have dealer markups but they did raise the Model Y price substantially in just a few months.

 

[texas_star_TM3]

The same reason why the average American has $6k in credit card debt but most have less than $5k in an emergency fund… Yolo!

and drive a $60k Model Y in your twenties but then have to work until your late 70s and eat cat food for dinner or be shelved in a cheap state run nursing home because you have saved nothing.

 

[texas_star_TM3]

Yes, the MSRP was under $40k by $100. But the $1200 delivery charge puts it over. Hopefully at some point Tesla can get this mythical $25 'Model 2' off the ground but they have commitments with the Semi and CT to resolve first. Of course, there are several other under $40k MSRP EV's available now (Leaf, MINI, Bolt. Others like the ID.4, Ionic5 and MME with higher specs are all under $40k including federal tax incentives. So not sure why Tesla HAS to offer a less expensive car. Not everyone needs or has to have a Tesla....

exactly. ID.4 with the *full* $7.5k tax rebate (if you can use it) is a solid EV. Not nearly as "sexy" as a $60k Model Y ... but also a lot cheaper. The obsession with "having to get" the latest and greatest Model Y is beyond me. I can definitely afford a Y but likely would replace my Model 3 AWD with another Model 3 AWD if i had to right now and get a Rolex OP from my AD with the savings...

 

[N1L CO2]

Every car manufacturer on the planet is milking the cows, pandemic, chip shortage and inflation to the last drop. Capitalism is brutal at times. Put yourself in the CEOs shoes. Even if you "could" produce the cars at the rate to fill demand, why do it if you can make 20-30% on the cars as it comes off the line with less expenses? Which in turn, increases revenue, which in turn increases stock value, which in turn increases their bonuses and stock options.

It's exactly what the oil industry has been doing for years. Every so often, they'll constraint supply by blaming broken refineries and supply chain issues to jack up the price at the pumps (funny it always happens during summer break and the busy holiday travel season). Do the prices come back down at a commensurate rate once the problems are fixed? NEVER!

If you are buying a car at above MSRP right now, you are throwing that money away as soon as you drive it off the lot. Most cars depreciate faster than you can make payments. Once the market corrects, you will never get that premium back once you go to sell the car. Folks will be lucky if they are not upside-down in the cars. Folks don't even realize they'll still be making payments on the money they just threw away in paying $15K over MSRP.

The market continues to test the consumers' tolerance with price increases to see what we are "willing" to bare. Folks who fail to control spending and continue to buy high-ticket items on credit cards and high-interest loans will find themselves in debt all the time.

 

[omegafiler]

When we got our MYLR, at about $8k less than it is today, I felt it was a decent value considering what you get. Although Tesla Vision has me seriously reconsidering that, at their current prices, I don't see buying another one anytime soon, as I was originally planning. For me, it's not just affordability, as I've purchased far more expensive vehicles. It's all about value. Perhaps in the future, if prices drop, tax incentives show up, or they add features, I'll take another look. Maybe things like the new battery tech, functional autopilot, and improvements in quality will make it back on the shopping list.

At the current price, there are a lot of other great options. Keep in mind, not everybody is limiting their next vehicle purchase to an EV, or Tesla, for that matter. And yes, you can easily find most new vehicles at or below MSRP - in particular, if you order one. Which most will recommend doing. Just shop around, find out what dealers are doing for ADM, add-ons, etc. Or wait a bit for things to settle down.

Regardless, Tesla can clearly sell vehicles at whatever price they want - for now. I'm not expecting to influence that. But we all have our own priorities. And for me, a MYLR at $64k doesn't make sense.