Tesla Model S CPO Website - Now Live

[schonelucht]

Please explain this theory.

On a quarterly basis, we assess the estimated market values of vehicles under our resale value guarantee program to determine if we have sustained a loss on any of these contracts. As we accumulate more data related to the resale values of our vehicles or as market conditions change, there may be material changes to their estimated values.

As of Jul 1st this year, Tesla carries just over $2B in resale revenue guarantee associated liabilities. With those numbers, even a few percent adjustment comes down to a multi-million loss which would be significant on their sheets. It's just easier to sit on inventory. Especially because some of that inventory can be used as borrowing collateral again on the ABL so it ain't all bad in cash-flow terms either. And, it's not that the inventory doesn't sell at all. It's just not priced to sell. At some point things have to give, but I think that point will only happen after 1) the liabilities have run down naturally since they stopped providing them 2) any adjustment would be much smaller relatively anyway due to growing overall profit/losses 3) some of the value losses have been absorbed in SG&A due to using them as loaners etc.

 

[HankLloydRight]

Maybe I'm not following (likely) but aren't the cars in the resale value guarantee program currently owned by customers? I don't think the TSLA quote above is talking about CPO inventory.

That $2b are liabilities if owners execute the RV guarantee. How does that factor into sitting on used inventory?

 

[⚡️ELECTROMAN⚡️]

Tesla can keep resale values high, by limiting supply. That way customers won't be collecting on the "resale value guarantee" if the resale value stays high enough.

 

[HankLloydRight]

But the resale value only stays high if cars are being sold. Looking at the CPO inventory, it doesn't look like much is actually moving out, so if prices are high, Tesla is bearing the expense of having this inventory sit on the lot and depreciate further. So it's an artificially inflated resale value.

 

[brantse]

But the resale value only stays high if cars are being sold. Looking at the CPO inventory, it doesn't look like much is actually moving out, so if prices are high, Tesla is bearing the expense of having this inventory sit on the lot and depreciate further. So it's an artificially inflated resale value.

Agreed. They may do this on purpose, as I believe they use many of the vehicles for the loaner fleet. Perhaps this has been discussed before, but Hank, do you track the vehicle mileage changes? I noticed when I had a loaner once, that the mileage listed on the CPO website would update at least daily. It would be interesting to see, as you could get an idea of how many of these vehicles are being routinely loaned out.

 

[MorrisonHiker]

Agreed. They may do this on purpose, as I believe they use many of the vehicles for the loaner fleet. Perhaps this has been discussed before, but Hank, do you track the vehicle mileage changes? I noticed when I had a loaner once, that the mileage listed on the CPO website would update at least daily. It would be interesting to see, as you could get an idea of how many of these vehicles are being routinely loaned out.

TeslaInventory.com tracks the odometer and price changes. You can use the graphs to see how the price usually decreases as the odometer increases. You are correct that the data is updated throughout the day. Tesla sometimes posts newer data followed by older data so sometimes the odometer and price can appear to fluctuate.

 

[Dreamer]

According to this data point, car depreciates more than $1 for every 1 mile. $4800 for 4450 miles to be exact in little over two months. I wonder what would be the bottom price for this type of vehicle in 3-4 years.

 

[Cyclone]

According to this data point, car depreciates more than $1 for every 1 mile. $4800 for 4450 miles to be exact in little over two months. I wonder what would be the bottom price for this type of vehicle in 3-4 years.

A CPO bare-bones S60 with 50k miles almost has Tesla paying you to take it then

 

[AMPd]

A CPO bare-bones S60 with 50k miles almost has Tesla paying you to take it then

I love Tesla so I'll do them a favor and take it without being paid.

 

[HankLloydRight]

I'm thinking another December CPO sale is coming!

I'm betting we'll see a bunch of CPOs (with and without Autopilot) and inventory models with the first generation Autopilot being listed soon. For those who don't need the latest and greatest, this could be a very good quarter to buy.

I bet we will start to see more APv1 equipped CPOs pretty soon in the US. Reason : lately there is an unwritten rule that CPO must be at least two years old in the US and Autopilot v1 equipped cars were introduced exactly two years ago. Don't expect a drop in price however. Accounting wise, it is better for Tesla to stockpile CPOs than to price them to sell...

Sure enough.. and it didn't take long at all. Hundreds of big CPO price cuts and new and relisted CPO inventory being added tonight. It's like a fire sale!

If you're in the market for a CPO with or without AP, now's the time to take a look at what Tesla is now posting for sale.

But strangely, also some price increases even on non-AP CPO cars. Weird.

 

[Spidy]

It's like a fire sale!

Many cars got like 1000 off some up to 2500, but the big price changes still just seem to be based on odometer according to teslainventory.

 

[Venomized]

The price showing on Tesla Inventory website finder already include the "price change" amount?

 

[mmd]

Sure enough.. and it didn't take long at all. Hundreds of big CPO price cuts and new and relisted CPO inventory being added tonight. It's like a fire sale!

If you're in the market for a CPO with or without AP, now's the time to take a look at what Tesla is now posting for sale.

But strangely, also some price increases even on non-AP CPO cars. Weird.

Not weird at all. This makes the price changes look like price adjustments, not price reductions. Some buyers will feel that prices are going up, so they may rush in to buy. Tesla bears can't shout out that Tesla is dropping CPO prices. if they do, Elon can quickly tweet the price increase examples.

Here is the thing. If the car was sitting at $x, will it sell at $x + $10k, or at $x-$10k?
If the prices are randomly changed every day, at which points are the cars likely to move? It will appear prices are moving randomly, but anyone who can actually track the selling prices might see something different.

 

[schonelucht]

But strangely, also some price increases even on non-AP CPO cars. Weird.

I think they moved to a new system for appraising their CPOs. The prices seem much more uniform and rounded to the nearest 500. Could explain why price movement wasn't uniform.

 

[HankLloydRight]

I had done a little more research into these apparent price increases, and they weren't actual price increases. On about 20 cars (estimate), Tesla lowered the price some amount (between $500 and $2000 or so), and then a short while later, reversed that decrease restoring the original price, and then coming back a third time and restoring the original price decrease. So in the end, after netting out the fluctuations, I don't think there were any actual price increases, just decreases.

 

[DÆrik]

The price showing on Tesla Inventory website finder already include the "price change" amount?

There are now multiple discount fields in Tesla's data file. I also track the price every time it is updated in the file. So I can calculate my own "price change" based on how much the prices have changed since the car was listed. I also compare the two discounts, mine VS. Teslas. I display whichever discount is more.

There are price increases and decreases. Most are price decreases, however there are a few cars that have been available for less then they currently are.

CPO price changes are calculated by the prices that the file has shown. We do NOT use Tesla's discount fields for CPO's because they are mainly off the new price. Not the used, currently listed price.

Thanks Erik

 

[tpedwards]

I don't get it. I get the finance committee on board and my car and about 40 others get pulled. I hope they didn't go to a wholesaler!

 

[MorrisonHiker]

Looks like the floodgates just opened. Earlier today, there were hardly any refreshed Model S available. Now I see nearly 200, some with discounts of over $12000!

Looks like a lot of these were ones we saw listed during the September fire sale.

 

[Dan43]

245 Inventory 399 CPO

 

[Wshowell]

Looks like the floodgates just opened. Earlier today, there were hardly any refreshed Model S available. Now I see nearly 200, some with discounts of over $12000!

Looks like a lot of these were ones we saw listed during the September fire sale.

Anyone else just really not impressed with these "discounts". Maybe I've become jaded but these price discounts stink relative to what we see at the end of Q3 and ESPECIALLY with what we saw with the release of 2.0. For my $$ I would probably go for a fully loaded CPO P85+ or a more stripped down new vehicle with the new hardware. The in between stuff needs to see some serious discounts if they intend to move it off the books. My $.02 worth $.00.