-
Want to remove ads? Register an account and login to see fewer ads, and become a Supporting Member to remove almost all ads.
Raising interest rate = less wait time for model x?
- Thread starter coolmanfever
- Start date
I think rising interest rates will prevent a number of people from buying new vehicles, homes, and more goods in general. And this is why the Fed is raising interest rates as part of its attempt to reduce inflation. Fewer customers will push companies to reduce prices to keep sales up and cash flowing.
Lester Green
Member
While I was pissed that my rate went from 2.49 to 4.49, it did not stop me from buying the car.
Some people won't care at all, some people will be pissed but will proceed because it's still within their means, some people will opt to not proceed at the current price/rate. The aggregate impact will be a reduction in demand.
Granted the X is an expensive vehicle already and its niche of customers are likely not as impacted by interest rates, but you can combine the rate hikes with wealth destruction happening across equities, crypto, home values, and other assets as part of the quantitative tightening
Good points. This may also lead to decreased used values for the X and other Tesla models. People are already seeing and discussing this in other threads.
Usually little to no effect. Seen 0% financing car loans from other manufacturers during 2007 when fed funds rate was at similar levels and I have seen 5% loan rates when the fed rate was a zero levels. Market is hot right now but may not be as hot next year if a full-blown recession occurs. Tesla still wants pre-orders to offset and downward economic trends.
Lester Green
Member
So you think people that can afford to purchase an X are going to worry about interest rates? I stand by my statement that there is no correlation. If rates were to get crazy (10%+) then maybe demand would slow. I think Chairman Powell missed econ101!
Yes. When both price and interest rates go up, people will slow purchases.
Just because you elect to continue your purchase (at 4.9% no less, but we won’t get into that) doesn’t mean the majority of people will.
And people who can “afford” an X, meaning cash buyers, could remain undeterred. But if you think the majority of people are dumping their cash reserves on a $120K+ luxury SUV, you are mistaken. Or financially irresponsible.
But either way, you are incorrect about what happens in the luxury vehicle market when prices and interest rates both rise.
What I said was a factual statement based on fundamental economic principles.
What you said was an opinion that runs fully counter to that and is based on a sample size of…you.
So…yeah…I guess agree to disagree.
Lester Green
Member
Whatever. Fact, Tesla has zero problems selling cars and has complete control of their pricing. People that can afford a Tesla really don’t seem to care. Enjoy the car, relax and stop the trolling. The entire board is full of opinions. My mistake was I should have said in my opinion and observations made, there has been little to no correlation.
Last edited:
I'm not sure why any of this would affect your enjoyment of the vehicle
But there's an obvious correlation here, interest rates are way up and wait times are way down. Establishing causation is a different story with all the factors in play, but I don't know how you can deny a correlation when it's evidenced in the delivery threads on this same forum and inventory builds on the Tesla website.
But there's an obvious correlation here, interest rates are way up and wait times are way down. Establishing causation is a different story with all the factors in play, but I don't know how you can deny a correlation when it's evidenced in the delivery threads on this same forum and inventory builds on the Tesla website.
I am retired, unemployed by choice, with no earned income. Why would I care? I paid cash.
He wasn’t quoting you.
And you fall into the bucket of cash buyers that are unimpacted as stated.
Unless you’re also on the economic principle denier bandwagon with @Lester Green
But I’m guessing since you are retired and not taking out 5% loans for $120K vehicles, that is not the case.
Higher interest rates are more likely to affect the used car market rather than new. The main goal of an automaker is to sell new cars. By lowering the advertised interest rate, it brings more people into the showroom/website. Similarly the primary drivers of revenue for car dealers (franchises) is used cars and service. Dealers negotiate with banks to reduce the interest rate in exchange for fee. That’s why you see 1.99% interest deals on used cars in July 4th. And this is where most of the “bank fees” go to.
You are all over the place with this comment.
You don’t think high interest rates impact new vehicle sales? No dealers are offering 1.99% on anything these days.
Similar threads
