Original Purchase Price of Car replaced by Model 3

[TT97]

On the investor letter today, Tesla referenced that over half the trade-in vehicles were priced below $35k when new.

While this is impressive and shows that people are upgrading/stretching to buy a Tesla, I feel that the statistics may be skewed. Luxury cars tend to be leased more often than lower priced vehicles. Naturally, leased vehicles wouldn't be traded in. For reference, 67% of all MBs and 70% of all BMWs are leased compared to only 35% for Honda and 32% for Toyota.

I am curious if our informal survey will get similar results as Tesla or if it will get skewed higher.

 

[Terthen]

On the investor letter today, Tesla referenced that over half the trade-in vehicles were priced below $35k when new.

View attachment 346793

While this is impressive and shows that people are upgrading/stretching to buy a Tesla, I feel that the statistics may be skewed. Luxury cars tend to be leased more often than lower priced vehicles. Naturally, leased vehicles wouldn't be traded in. For reference, 67% of all MBs and 70% of all BMWs are leased compared to only 35% for Honda and 32% for Toyota.

I am curious if our informal survey will get similar results as Tesla or if it will get skewed higher.

That’s a really good point, would not have thought of that.

I traded up from a 2008 Accord. It could have gone another 100k miles probably, and as our secondary car only really for commuting, I did not see any ICE worth trading the Accord in for this purpose. Similarly i didn’t have enough desire for the Bolt or Leaf or other similar EV... but the 3 is the complete package and with the tax credit disappearing, I was willing (or rather couldn’t hold myself back) to make the upgrade much sooner.

So it will be interesting when tax credit disappears. I would probably have waited for 35k version, so I still would have bought one eventually, but not the fully optioned LR RWD. Def would have gone for MR if I was buying today.

 

[boriszima]

Model 3 replaced my 2007 Nissan Altima v6, $25k OTD back in 2007. I was in the market for a brand new v6/Hybrid Camry or Accord, fulled decked out for $35k, but made a right choice and here I am spending nearly twice as much as i should/wanted.

 

[Jedi2155]

I sold my $12,000 ($14k after taxes and incentives) new Spark EV for $7100 before I paid the $87k for my P3D+FSD (~$75k all said and done).

 

[nvx1977]

then you have people like me who didn't trade in their old car but should have. I would have supported their narrative. Hyundai Sonata. Planning to carmax it in the next week or so.

Didn't realize the upkeep of an idle car was so high.

 

[SageBrush]

While this is impressive and shows that people are upgrading/stretching to buy a Tesla

Or Tesla selects for people able to count, as in count fuel savings.

I pay 0.5 cents a mile to fuel the Tesla;
My Toyota hybrid was about 6 cents a mile;
While the average ICE is about 10 - 12 cents a mile.

The seekret ? PV+EV

 

[SageBrush]

Didn't realize the upkeep of an idle car was so high.

Exactly

That is the hidden cost of low range EVs when people also hold on to an ICE for occasional use.

 

[Wooloomooloo]

While this is impressive and shows that people are upgrading/stretching to buy a Tesla, I feel that the statistics may be skewed. Luxury cars tend to be leased more often than lower priced vehicles. Naturally, leased vehicles wouldn't be traded in. For reference, 67% of all MBs and 70% of all BMWs are leased compared to only 35% for Honda and 32% for Toyota.

I am curious if our informal survey will get similar results as Tesla or if it will get skewed higher.

Everyone's circumstances are different, but a lot of people buy cars based on practicality rather than affordability. I had a golf GTI, sticker price was about $34k (about 10% of my income give or take). So that that decision was nothing to do with affordability and everything to do with me wanting a practical car (there really aren't many hatchback options in the US), one suiting a city where size matters (ahem), plus it's practical and fun and in that class and to be honest spending twice as much on an Audi RS3 seemed like a waste and I've never really liked Audis.

So when it came to a Tesla, I pretty much went for the best M3 I could buy - a Model X was pointless for me (no kids, just me and my wife) and the Model S just felt too big and not 'european' enough.

Everyone will have their own story, but I think it's a myth that people buy cars based on their income and ability to pay. My boss (who probably makes more than double what I do) drives an 11 year old Corolla!

 

[Twiglett]

I traded a '13 Leaf for my 3
Still have a CRV but it only gets used for short trip and for dog transport - really need a short range crossover EV

 

[Knightshade]

Some folks with higher priced cars might've also had more financial flexibility to not trade in, but private sale the car for more $ instead whcih could skew their #s a decent bit.


FWIW my previous car was a 2008 Lexus IS350- sticker was ~43k back in October of 2007 when I bought it new (though I didn't pay that much for it)- CPI inflation calculator says that's about $52,000 in todays dollars...which is pretty close to what my Model 3 cost if you don't count the software options

 

[JeffK]

So far the results look identical to Tesla's results.

 

[Jard]

Replaced a '16 BMW 328i Sports Wagon - MSRP was $55,xxx but I "paid" $48,xxx and it was a lease.
I didn't trade it in, I just gave it back to BMW.

 

[Dorkiedoode]

Our new M3 is replacing my gf 2007 Toyota Corolla S LoL. I would say its worth about 3-4K at trade in but decided to pass it down to her dad for coffee meet up.

 

[StellarRat]

My 2011 Leaf was a great car for getting around town and I would have kept it much longer, but now that I'm close to retiring I wanted to get a car I could travel in easily. There are many places in my State that are simply too much trouble to get to with range the Leaf offered. That will not be an issue with the M3 LR.

 

[Richt]

I had not realized that bmw and Mercedes lease rates were that high. Data point we don’t have it how many model 3a are seeing trade ins. Does anyone know this? Are we talking about ½ of all cars to 1%?

 

[Abstrakt1]

I upgraded from a 2008 corolla. I was never really interested in luxury cars and wouldn't have been able to afford it back in 2008 when I got the corolla. But now my kids are old enough to not destroy the back and my career is in a place where I feel comfortable spending a bit more. If it wasn't for Tesla though I probably wouldn't have bought a luxury car, I would have just got another corolla or something while I waited for a car that was an EV and had the tech I desired.

 

[ulrichw]

So far the results look identical to Tesla's results.

Almost uncannily so!

The car being replaced in my case was a VW e-Golf SE - just under $30k new (but an insane lease deal).

 

[Snow Drift]

Traded in a 2015 Subaru XV Crosstrek Hybrid...$30k MSRP.

 

[Maltaltin]

I traded in a 2016 Jaguar F-Type with an MSRP of Mid 70s.

 

[PoitNarf]

Checks out for me, traded in my 2012 Mustang for my Model 3. The Mustang was purchased new for around $34K.