Resale Value of Base Model 3 in 6 years

[Petrocelli]

I am considering buying a RWD Model 3 with a cost of about $40,000. For the past 21 years, I have leased a C class Mercedes and have gotten a new pone every three years.

I am running through various scenarios to determine how much I would save if I bought a Model 3 over 6 years, and resold it, versus leasing two Mercedes over 6 years.

The number in the spreadsheet that I would like to get your opinion on is this: What do you think the resale value of a 2019 Model 3 will be in 6 years? Assume the car is in good condition, and has 90,000 miles on it.

Thanks in advance

 

[Stach]

A Honda Accord retains about 48% of its value after 6 years, which I think is a good place to start. Of course the new price of a SR Model 3 could be cheaper than $35,000 by then, but I'll stick with near 50% of my cost, so around $17,499.

 

[Ryefry]

The big question about future value is if full self driving will be solved by Tesla with these cars and be allowed to be used on your California roads by then? I think there is a case where the car is worth substantially more if it can fully drive autonomously.

 

[pk44FG]

A Honda Accord retains about 48% of its value after 6 years, which I think is a good place to start. Of course the new price of a SR Model 3 could be cheaper than $35,000 by then, but I'll stick with near 50% of my cost, so around $17,499.

To me, I think the battery tech has much more of a play here. To stick with round numbers,
- lets say todays M3 at $50K gives 250 miles on an average for a full battery which takes 10 hrs to charge at home
- What would you pay today for a M3 which will give 500 miles ( so better battery capacity )
- What would you pay today for a M3 which will take 5 hrs to charge for 250 miles ( so battery recharge tech )
- What would you pay today for a M3 which will take 5 hrs to charge for 500 miles ( better over all )
- Would you pay for a tech swap on your old M3 for this new battery tech - if tesla allows that option as well ( say $10K) or buy a new one.
- What if 2025 Honda or Toyota match 2019 M3 (interior and features ) with supercharger and offer it at 40K
An old M3 will be competing against all these factors..

Very hard to answer for me .. or should we just take today's luxury sport sedans like bmw, merc, etc and use their trends ..

 

[cypho]

I think there is a case where the car is worth substantially more if it can fully drive autonomously.

Tesla got lucky with everyone else neglecting the BEV market for years and years. But a bunch of car companies (and other tech giants ) are working on self driving cars and many have been working on it a lot longer than Tesla has.

Tesla is the only one willing to sell unimplemented promises of Fully self driving cars. But once the technology is shown to work and be reliable, I don't think that is likely they will be the only player on the field for long.

I wouldn't assume that a 2019 Tesla will outperform the average new car in 2025 when it comes to self driving tech.

I can see the value of cars without Self driving abilities plumiting, but I don't see much chance used that used model 3's will be worth more than new cars from the other major manufacturers.

 

[Ryefry]

Tesla got lucky with everyone else neglecting the BEV market for years and years. But a bunch of car companies (and other tech giants ) are working on self driving cars and many have been working on it a lot longer than Tesla has.

Tesla is the only one willing to sell unimplemented promises of Fully self driving cars. But once the technology is shown to work and be reliable, I don't think that is likely they will be the only player on the field for long.

I wouldn't assume that a 2019 Tesla will outperform the average new car in 2025 when it comes to self driving tech.

I can see the value of cars without Self driving abilities plumiting, but I don't see much chance used that used model 3's will be worth more than new cars from the other major manufacturers.

True but most those other manufactures are using LIDAR which will be much more expensive. I think Tesla will be the first to deliver level 3 autonomous driving at the price point most can afford, which should make a used 2019 even more attractive. At this point it is just a bet.

 

[cucubits]

....
I think Tesla will be the first to deliver level 3 autonomous driving at the price point most can afford
....

I don't think this will happen as long as they insist on relying only on radar and image recognition. Sadly it will probably be too late by the time they realize that.

 

[SteveOfMo]

Tesla needs to watch out for Rivian with their LIDAR, 5 position Radar, HD GPS, sonic sensors, 4 motors and 400+ range. Their vehicles will be starting at $62k.

 

[molder101]

Tesla needs to watch out for Rivian with their LIDAR, 5 position Radar, HD GPS, sonic sensors, 4 motors and 400+ range. Their vehicles will be starting at $62k.

You don't have to watch out for a product until it's actually available for sale & delivery. You can be cognizant of it, but it's not a problem until you, I, or anyone else that wants it can easily buy it.

Until then, it's simply a pipe dream. Same goes for Tesla Semi etc, however, Tesla has a measurable track record in manufacturing, Rivian does not.

 

[M3BlueGeorgia]

I am considering buying a RWD Model 3 with a cost of about $40,000. For the past 21 years, I have leased a C class Mercedes and have gotten a new pone every three years.

I am running through various scenarios to determine how much I would save if I bought a Model 3 over 6 years, and resold it, versus leasing two Mercedes over 6 years.

The number in the spreadsheet that I would like to get your opinion on is this: What do you think the resale value of a 2019 Model 3 will be in 6 years? Assume the car is in good condition, and has 90,000 miles on it.

Thanks in advance

Pretty much of a no-brainer. And you'll probably have more than 90K miles in 6 years.
One advantage of not having a lease is you stop worrying about driving it.

 

[ucmndd]

A Honda Accord retains about 48% of its value after 6 years, which I think is a good place to start. Of course the new price of a SR Model 3 could be cheaper than $35,000 by then, but I'll stick with near 50% of my cost, so around $17,499.

Honda and Toyota resale value might be a good place to aspire to, but I'd say damn near impossible for Tesla to reproduce in the coming years due to a variety of factors, most notably:

* Quality, reliability, and service experience
* Cost pressures from emerging technology

EVs aren't at the apparent limit of their technology evolution the way that well-sorted ICE vehicles like Toyotas and Hondas are. EVs being delivered in the next 6 years will have more range, more longevity, faster charging, and everything else that comes along with improvements in battery technology and autonomous driving.

As someone who owns a 2.5 year old Model S worth less than 50% of its purchase price, I'd say definitively that you should not buy a Tesla based on ANY calculations or delusions about future value.


Note that this argument does not address lord Elon's claim that your cars are now appreciating assets because that's, well, ludicrous.

 

[Ryefry]

There will likely be several more prices changes with the Model 3 before 2025 that will dramatically change the used car values as well. It is probably the hardest car to put a residual value on currently.

 

[Octo]

If you are concerned about resale, I’d just lease.

I don’t think you can compare this to a Mercedes or a Toyota ICE.

Tesla may not exist in 6 years, or Tesla may rule everything with robotaxis, or Tesla may drop new Model 3 prices substantially again or Tesla may have Model 3SuperSexy in 2025 that is so much better than a 2019 Model 3 ruining used values...

I think the Model 3 is good enough already to justify a purchase without resale value in mind (I wouldn’t mind driving it until it falls apart of old age). But if you are concerned about resale, I’d hedge my risk through a lease.

 

[Dan203]

I'm betting it's more in the $10-$12K range, maybe less. These cars are very technology oriented. If Tesla comes out with a new version that's using better technology your used one is going to be less desirable. On the flip side if they actually get FSD working and you paid for that then it could actually be worth a lot more. But I have my doubts about them getting FSD working and approved by regulators in the next 6 years.

 

[AcesUp]

I am considering buying a RWD Model 3 with a cost of about $40,000. For the past 21 years, I have leased a C class Mercedes and have gotten a new pone every three years.

I am running through various scenarios to determine how much I would save if I bought a Model 3 over 6 years, and resold it, versus leasing two Mercedes over 6 years.

The number in the spreadsheet that I would like to get your opinion on is this: What do you think the resale value of a 2019 Model 3 will be in 6 years? Assume the car is in good condition, and has 90,000 miles on it.

Thanks in advance

If cost of depreciation (which can be significant) is your main concern have you considered buying a 2-3 yr old accord or camry?

 

[KenC]

I'd check on used Model S values after 6 years and 90k miles, to get a sense of how the Model 3 would hold up in price.

 

[Jayzee9]

The answer is you're probably going to pay more..

I am a lease hacker, and currently pay about $5000 every 2 years for a loaner Mercedes C class myself, 12k/year. I don't have to buy tires and do one maintenance during that period that costs $400. So, total cost of ownership (including all fees and taxes is $5700 (another year registration). Keep in mind I also got 25k UAL miles thrown my way. If I extrapolate that, over a 6 year period, It costs me $17,100 to lease the Mercedes all in. I'd like to see anyone get close to that on any Tesla.

In the end, you have to do it because you prefer the car and are willing to pay a premium for it, rather than as a money saver. Mercedes also gives me loaners for service, does not nickel and dime on lease returns, etc.

 

[Dan203]

I'd check on used Model S values after 6 years and 90k miles, to get a sense of how the Model 3 would hold up in price.

According to KBB a $70k 2013 Model S with 90k miles on it is worth about $23K now. So if the Model 3 holds the same percentage of value it would be about $13k in 6 years.

 

[Daniel in SD]

I'd check on used Model S values after 6 years and 90k miles, to get a sense of how the Model 3 would hold up in price.

Looks like 50% is optimistic.
Model S 85 | eBay

 

[ucmndd]

lol, @M3BlueGeorgia going hard on the disagrees to keep his residual value distortion field intact