Also, you may say that it's the law and tesla "discloses" but the issue is that people buying USED demos seem to "think" their cars are new.
The Term "Demo" doesnt mean anything legally, but NEW and USED are legal terms. It is entirely possible to have a car that was a "DEMO" but has zero miles on it, and is being sold as USED, or the same car being sold as NEW.
Most people dont tend to care about legal terms related to NEW and USED though, so if the car has zero miles on it they will call it a new car, even if its legally used.
Conversely, its entirely possible to have a car that was a demo and driven thousands of miles (See
@HankLloydRight 's example). I have my own personal example of doing that. In my case it was a demo BMW that had just under 5000 miles on it, however it had never been "punched" so the car was SOLD AS "NEW". Legally, it was a new car. In actuality, it was obviously used before, but that doesnt matter for the legal definition of new vs used, nor does the fact it had 5k miles on it matter for that definition.
Regular people latch onto the word "demo" like it means something, but it doesnt mean anything for how the car was actually used. Could have been sitting in a show room, could have been driven, could have even been used as a gopher car for the dealership to run errands. All three of those circumstances could be a called a demo, but whether the car is legally New or Used when a person buys it depends on whether the car was sold previously or not, even if that "sold previously" was the dealership selling the car to itself.
A dealer does not HAVE to sell a car to themselves to use it as a demo. They usually dont, because they want to sell the car as New when they get done with it, as that is most advantageous for the purchaser (tax reasons, warranty etc).
Traditional dealers usually only sell a car to themselves that they are using as a demo to meet sales numbers (like escalation clauses that say they need to sell X number of Y to get paid 4% per car vs 3% per car back end money from the manufacturer.
Anyway, the TL ; DR of this is, "ALL car buyers should completely ignore the word "Demo / Demonstration" vehicle when a car dealer uses the term because it means absolutely nothing. It tells zero about how the car was used, legally. Its no different than a car dealer saying "this car was owned by a senior citizen who only drove it to the store on weekends." They should instead focus on whether the car is being sold to them as NEW vs USED (which matters for things like Tax rebates, warranty start date, etc) and the actual condition of the car.
It's still completely meaningless in this context. As clearly mentioned above, a Tesla "demo" could be a showroom car, an executive car, a service loaner, or any/all of the above. "Demo" does not JUST mean "showroom car" as you asserted here:
