I like to read about Tesla Motor's on Seeking Alpha, because some of the posters seem so desperate to hold on to their idea that oil and ICE will prevail and because the posters there in my mind try to give the appearance of great insight into Tesla Motors and its future, when in my opinion they often do not have that. Some of the Tesla articles there are also good, I should add.
Anyway, a recent post there titled 'Tesla: Time To End The Resale Guarantee Backstop' argues that the CPO program is a liability to Tesla, because of the buy-back guarantee and apparently also because of the problematic accounting involved in the CPO program.
My understanding of the CPO program is that it was created because margins on used car sales are better than on new car sales and that Tesla Motors thus could earn a good profit a second and even third time on some of the cars they sell. It is also an advantage that a prospective car buyer would need to be less concerned about resell value, but Tesla does not currently seem to have a problem with demand, so I see that as somewhat secondary. Maybe I am mistaken, but that is not the point.
At this time, the size of Tesla's CPO inventory does not seem to be overly large, so I guess they manage to sell the cars more or less in amounts corresponding to new arrivals.
So as long as Tesla makes a reasonable profit on the CPO program, I cannot see why it should be retired.
So does anyone here have any information on how profitable the CPO program actually is and how many cars they actually (re)sell that way?
Thanks.
Anyway, a recent post there titled 'Tesla: Time To End The Resale Guarantee Backstop' argues that the CPO program is a liability to Tesla, because of the buy-back guarantee and apparently also because of the problematic accounting involved in the CPO program.
My understanding of the CPO program is that it was created because margins on used car sales are better than on new car sales and that Tesla Motors thus could earn a good profit a second and even third time on some of the cars they sell. It is also an advantage that a prospective car buyer would need to be less concerned about resell value, but Tesla does not currently seem to have a problem with demand, so I see that as somewhat secondary. Maybe I am mistaken, but that is not the point.
At this time, the size of Tesla's CPO inventory does not seem to be overly large, so I guess they manage to sell the cars more or less in amounts corresponding to new arrivals.
So as long as Tesla makes a reasonable profit on the CPO program, I cannot see why it should be retired.
So does anyone here have any information on how profitable the CPO program actually is and how many cars they actually (re)sell that way?
Thanks.