Take Delivery of M3 and Sell in a Few Months?

[sc20]

I have an M3P on order (Tesla Loan) due to arrive in June. I just found out my employer will start doing Salary Sacrifice "later in the year" where I can lease the same car with a significant tax saving.

Is it feasible to take delivery of the M3 I have on order, use it for the 6 months or so (very low mileage) while I wait for the lease delivery, and sell it for (not much) of a loss to a company like Motorway when my lease one arrives? Or, does depreciation make this a very costly exercise?

I'm unsure whether the used market is still like it was, with some people able to sell their cars for almost the same or more than they bought them for.

Edit: judging by Elon's recent comments, maybe this is a stupid question. "Ridiculous demand" Elon Musk warns Tesla may stop taking orders on some vehicles due to "ridiculous" demand

 

[orion2001]

The bigger risk to you is that Tesla is very aggressively pursuing people who resell cars within a few months of purchase because they are trying to shut down people trying to flip Tesla cars for profit as a business model. This violates their ToS and there have been a few people who have posted here who have been given a lifetime ban from Tesla for flipping a car shortly after purchase. One person wasn't even trying to turn a profit, they'd been an early Tesla adopter and ordered the MY recently, didn't like it and ended up selling it and getting an M3 instead.

The only thing I'm unsure about is whether consumer protections in your neck of the woods will prevent this from happening to you. But if it did, you are very quickly placed in a Kafkaesque situation that is really hard to get out of.

 

[WannabeOwner]

I just found out my employer will start doing Salary Sacrifice "later in the year" where I can lease the same car with a significant tax saving.

What is the "later in the year" they are waiting for? Might be worth asking, dunno how big / bureaucratic your company is, but it might be that they need bums-on-seats to start it.

We offered Salary Sacrifice to our staff. No immediate interest. We have to pay a subscription to 3rd party company that will operate the scheme, and we have no incentive to do that until a number of people actually want to take it up ...

... so if that is the case in your company maybe you can influence the start date. (I'm assuming you can "move" your car to the finance deal, that may not be the case of course)

 

[bc1979]

The bigger risk to you is that Tesla is very aggressively pursuing people who resell cars within a few months of purchase because they are trying to shut down people trying to flip Tesla cars for profit as a business model. This violates their ToS and there have been a few people who have posted here who have been given a lifetime ban from Tesla for flipping a car shortly after purchase. One person wasn't even trying to turn a profit, they'd been an early Tesla adopter and ordered the MY recently, didn't like it and ended up selling it and getting an M3 instead.

The only thing I'm unsure about is whether consumer protections in your neck of the woods will prevent this from happening to you. But if it did, you are very quickly placed in a Kafkaesque situation that is really hard to get out of.

Surely there is no term or condition that can prevent an owner of a Car selling it after 6 months of ownership?

 

[Big_D]

Surely there is no term or condition that can prevent an owner of a Car selling it after 6 months of ownership?

Exactly, complete nonsense. If you buy a car you can do with it whatever you like.

 

[GeorgeSymonds]

I’ve heard of people flipping cars but not heard of Tesla trying to block them. Tesla work in a very transparent way (prices are fixed, you buy off the web page, staff can’t really influence things etc). I had my last Tesla for about 8 months and sold it for a profit back to Tesla.

Back to the OPs question, its a call on depreciation. As mentioned above I made a profit on my last one, if my company had bought it I’d have paid BIK and the company tax on the increased value. I also get 45p a business mile and not 5p. I was better off doing it my way, times are pretty unusual but it does illustrate that a company car isn’t necessarily a great deal. If you plan to lease, then there’s no upside for you if depreciation is lower than expected though.

Secondly, even if your company offered a scheme today, you’d have to wait until they could get a car for you. If they started the scheme in 6 months, and you had a 6 month wait for the car, you’re a year away from having a car.

So what you suggest is possible, and depreciation at the moment is pretty kind.

If you’re offered the car in June and you’re not leading I’d take it, and when the company car option comes around, do the maths to see whether changing is worth while and how long it will take.

 

[candida]

Exactly, complete nonsense. If you buy a car you can do with it whatever you like.

First of all the poster who mentioned this was in North Carolina. The Land of the Free has some commercial practices which seem odd to European eyes (like the states with direct sales bans). I agree that here a no resale clause would probably not survive in a consumer contract, but even here, dealerships have long had preferred customers who get offered the "collector" stuff - Ferrari and Porsche are obvious examples. If you bought one of those cars and flipped it, you'd certainly be off the first look list next time.

 

[WannabeOwner]

Doesn't it look like this?

Buy a car
wait 6 months
Order another one (on salary sacrifice, so might look like company-buyer, rather than O/P)
wait a couple of months, maybe more, for delivery
Sell the first one ...

Can you trade the first one in? dunno if that is possible with Salary Sacrifice?

 

[Big_D]

First of all the poster who mentioned this was in North Carolina. The Land of the Free has some commercial practices which seem odd to European eyes (like the states with direct sales bans). I agree that here a no resale clause would probably not survive in a consumer contract, but even here, dealerships have long had preferred customers who get offered the "collector" stuff - Ferrari and Porsche are obvious examples. If you bought one of those cars and flipped it, you'd certainly be off the first look list next time.

A Tesla is certainly no Porsche, but why would Tesla even care if you’ve sold your car? Once you bought it, it’s yours to do with as you please. If they think you’re a speculative buyer, good on you, you may be back for to buy more cars.

 

[sc20]

Doesn't it look like this?

Buy a car
wait 6 months
Order another one (on salary sacrifice, so might look like company-buyer, rather than O/P)
wait a couple of months, maybe more, for delivery
Sell the first one ...

Can you trade the first one in? dunno if that is possible with Salary Sacrifice?

Yes I think that will have to be the plan, as I don't know how long it will be until the scheme is even available, and then you're looking at least 3 months+ for delivery from there.

I take it there is no way to move existing Tesla orders over to these salary sacrifice lease schemes, as it's not Tesla who manages them?

 

[WannabeOwner]

I take it there is no way to move existing Tesla orders over to these salary sacrifice lease schemes

I think you'll get your car long before then ... but ...

I don't know the answer in terms of Salary Sacrifice, but (unless you company is doing it themselves perhaps?) it seems to me that if it is an outsourced service then it must surely just be a type of finance. And for normal finance you can make a Reservation, direct to Tesla, get the RN number ... and then "transfer" than RN Number to the finance company. So maybe that will work for Salary Sacrifice too.

 

[sc20]

I think you'll get your car long before then ... but ...

I don't know the answer in terms of Salary Sacrifice, but (unless you company is doing it themselves perhaps?) it seems to me that if it is an outsourced service then it must surely just be a type of finance. And for normal finance you can make a Reservation, direct to Tesla, get the RN number ... and then "transfer" than RN Number to the finance company. So maybe that will work for Salary Sacrifice too.

I think they will be using Octopus EV or something similar. It's only on hold because we're being acquired so these kinds of changes can't be done for while the transaction completes.

If it can be transferred then there's always the option of putting delivery on hold until nearer the time.

 

[candida]

A Tesla is certainly no Porsche, but why would Tesla even care if you’ve sold your car? Once you bought it, it’s yours to do with as you please. If they think you’re a speculative buyer, good on you, you may be back for to buy more cars.

I agree which is why I think they're offering such inflated trade in values. Only point I was making is they can do what they like and in different markets may be operating differently

 

[roadcred]

Unless I am mistaken Orion 2000 is from NC (North Carolina?).
Tesla may well be able to do what he suggests in NC - certainly not in the UK!

 

[orion2001]

<snip>

The only thing I'm unsure about is whether consumer protections in your neck of the woods will prevent this from happening to you. But if it did, you are very quickly placed in a Kafkaesque situation that is really hard to get out of.

First of all the poster who mentioned this was in North Carolina. The Land of the Free has some commercial practices which seem odd to European eyes (like the states with direct sales bans). I agree that here a no resale clause would probably not survive in a consumer contract, but even here, dealerships have long had preferred customers who get offered the "collector" stuff - Ferrari and Porsche are obvious examples. If you bought one of those cars and flipped it, you'd certainly be off the first look list next time.

Unless I am mistaken Orion 2000 is from NC (North Carolina?).
Tesla may well be able to do what he suggests in NC - certainly not in the UK!

Yup, like I said in my original post, I'm not sure whether it translates over to the UK, but fundamentally, I don't see any reason why Tesla couldn't blacklist an individual and refuse further sales in the UK to them as a private company? It's not that they are explicitly blocking sale of an existing vehicle someone has purchased and wishes to sell. Again, I'm just pointing out that this is happening right now at least in the US, so it is worth looking into if you are looking to flip a Tesla. An easy place to check is the purchase agreement and any clauses around reselling, etc.

And for those who don't believe this is true or happening:

Tesla Blacklist

So I run a Turo business where I rent out Teslas. I buy many Teslas, and most of my renters end up buying my cars. I got an email from Tesla today saying "Loss prevention team has informed me that we will have to black list you from further purchases. As it turns out, reselling vehicles is...

teslamotorsclub.com

While the above example is rather blatant, there was another poster who had posted a few months ago about being banned from purchasing when his account got flagged, even though he had been an early adopter and a loyal Tesla customer. His only "crime" was purchasing an M3 and then deciding they'd rather have a MY and ordering that and reselling the M3 for a profit while waiting for the MY. Unfortunately I can't find that thread at the moment.

So this stuff can and is happening. Might very well not happen to OP. Just wanted to make sure they were aware though.

 

[mjspin]

Interesting timing for me to stumble on this thread. I am also in UK and had been considering upgrading to an MY from my 6 month old M3. Had looked at current resale values with the usual suspects (Motorway, WBAC and Tesla themselves) with best previously being basically what I paid for the car (c£40k). Earlier this evening I got an update from WBAC increasing their price to £44k. So I’ll have had 6 months driving for -£670 per month. Definitely food for thought

 

[_MJF_]

I have an M3P on order (Tesla Loan) due to arrive in June. I just found out my employer will start doing Salary Sacrifice "later in the year" where I can lease the same car with a significant tax saving.

As others have said, it could be a good few months for the scheme to be up and running and then a good few months to wait for the car, could be as much as 12 months potentially. Depending on what you're currently running and the mileage, you could save a fair bit in fuel over that time alone. Prices could also increase a fair bit in that time too.

In my case Tesla wouldn't let me trade in as it was a lease scheme (it wasn't a Tesla but they didn't know that), presumably Tesla just view it as a lease scheme and don't know or care whether it's salary sacrifice.

Whilst the salary sacrifice scheme would undoubtably be cheaper, the savings might not be as much as anticipated. I thought it would simply be a mid-range lease quote, then apply the salary sacrifice element to reduce it, and then add on the BIK. But, in practice it was more expensive than that, insurance and maintenance were bundled in with no option not to, at inflated prices, plus the base lease price seemed more expensive than expected. I've heard the take-up has been roughly 1 in every 35 people for us, many couldn't believe how expensive the insurance element worked out and made it a non-starter (not just Teslas, all EVs). Unfortunately the salary sacrifice scheme should provide all the benefit to the end user, but can't help thinking some lease companies are inflating the prices because they know it's still work out cheaper and they can slice off their cut. But, I'd still expect a salary sacrifice to be far cheaper than any other way of financing it, it certainly was for me.

Also, with salary sacrifice then if you move jobs then your car goes back unless you drop lucky with an option to buy. If the company is currently being taken over then it might not be the same a few months on.

So, based on the information given, I'd be tempted to keep the existing order and see what pans out. If there's an option to be financially better off with salary sacrifice at some point in the future then great, but enjoy the Tesla and save some money in the meantime.

 

[sc20]

As others have said, it could be a good few months for the scheme to be up and running and then a good few months to wait for the car, could be as much as 12 months potentially. Depending on what you're currently running and the mileage, you could save a fair bit in fuel over that time alone. Prices could also increase a fair bit in that time too.

In my case Tesla wouldn't let me trade in as it was a lease scheme (it wasn't a Tesla but they didn't know that), presumably Tesla just view it as a lease scheme and don't know or care whether it's salary sacrifice.

Whilst the salary sacrifice scheme would undoubtably be cheaper, the savings might not be as much as anticipated. I thought it would simply be a mid-range lease quote, then apply the salary sacrifice element to reduce it, and then add on the BIK. But, in practice it was more expensive than that, insurance and maintenance were bundled in with no option not to, at inflated prices, plus the base lease price seemed more expensive than expected. I've heard the take-up has been roughly 1 in every 35 people for us, many couldn't believe how expensive the insurance element worked out and made it a non-starter (not just Teslas, all EVs). Unfortunately the salary sacrifice scheme should provide all the benefit to the end user, but can't help thinking some lease companies are inflating the prices because they know it's still work out cheaper and they can slice off their cut. But, I'd still expect a salary sacrifice to be far cheaper than any other way of financing it, it certainly was for me.

Also, with salary sacrifice then if you move jobs then your car goes back unless you drop lucky with an option to buy. If the company is currently being taken over then it might not be the same a few months on.

So, based on the information given, I'd be tempted to keep the existing order and see what pans out. If there's an option to be financially better off with salary sacrifice at some point in the future then great, but enjoy the Tesla and save some money in the meantime.

Thanks for the info. Is the insurance included at a flat rate for everyone or is it still variable based on your history, age, etc?

I have heard and am not surprised it would cost more than leasing directly with Tesla. That said, as it is a 40%+ saving for me it would have to be outrageously overpriced to not be a saving. Will have to run the numbers once it's visible though to see.

 

[_MJF_]

Thanks for the info. Is the insurance included at a flat rate for everyone or is it still variable based on your history, age, etc?

No, it was very much variable. Age and postcode were definitely factors, it wasn't as comprehensive as a normal insurance quote and didn't include claim history, can't remember if it asked for convictions and years experience. It didn't include existing NCD either and of course you'll probably lose your existing NCD unless you can work around that. It didn't break down insurance specifically but lumped in an additional amount for insurance, maintenance (servicing, tyres), breakdown cover and some end-of-lease cover, but colleagues running identical quotes found big variations which could only be due to the insurance element - one ran an identical quote to me and was far higher, but it would cost them £2k a year to insure a Tesla independently anyway.

I have heard and am not surprised it would cost more than leasing directly with Tesla. That said, as it is a 40%+ saving for me it would have to be outrageously overpriced to not be a saving.

Yes, exactly.

Will have to run the numbers once it's visible though to see.

I think most schemes have a calculator but I'd run your own numbers to double-check. Of course there are hidden benefits for some with salary sacrifice, like the classic person on £60k with kids who leases a car for £10k a year gross and then also ends up keeping all the child benefit they otherwise would've lost, also for anyone who uses salary sacrifice to get into a lower tax bracket so then other taxable stuff (e.g. health care) becomes cheaper, etc.

 

[Rooster6655]

Yup, like I said in my original post, I'm not sure whether it translates over to the UK, but fundamentally, I don't see any reason why Tesla couldn't blacklist an individual and refuse further sales in the UK to them as a private company? It's not that they are explicitly blocking sale of an existing vehicle someone has purchased and wishes to sell. Again, I'm just pointing out that this is happening right now at least in the US, so it is worth looking into if you are looking to flip a Tesla. An easy place to check is the purchase agreement and any clauses around reselling, etc.

And for those who don't believe this is true or happening:

Tesla Blacklist

So I run a Turo business where I rent out Teslas. I buy many Teslas, and most of my renters end up buying my cars. I got an email from Tesla today saying "Loss prevention team has informed me that we will have to black list you from further purchases. As it turns out, reselling vehicles is...

teslamotorsclub.com

While the above example is rather blatant, there was another poster who had posted a few months ago about being banned from purchasing when his account got flagged, even though he had been an early adopter and a loyal Tesla customer. His only "crime" was purchasing an M3 and then deciding they'd rather have a MY and ordering that and reselling the M3 for a profit while waiting for the MY. Unfortunately I can't find that thread at the moment.

So this stuff can and is happening. Might very well not happen to OP. Just wanted to make sure they were aware though.

The op should not even have any concern about this based on his situation, if he was to get banned for being genuine then they don’t deserve the sale.