Tesla's Tesla Trade In is Broken

[resteb]

Just offered my 2018 M3 AWD LR in Silver as a trade in to Tesla to upgrade to a Performance and they said it was only worth $33K. Carvana is quoting closer to $42K to buy it and KBB shows $42K Trade-In for "Good" condition. It only has 11,000 miles so it should be "Very Good" or better. Normally I would just dispose of it third party and call it a day, but in Georgia they charge tax at time of new car purchase and subtract the trade-in value, so looking at an extra $2,800 loss there if I can't trade it in. Tesla expects me to eat $11,800 on top of the $12,000 first year depreciation for a whopping total of $23,800!

As a Tesla owner and shareholder I am very concerned that Tesla is undervaluing the Trade In value of their own cars so drastically. The lowest for sale used 2018 M3 AWD LR on Tesla.com is $46K. So I eat $23,400 and they make another $13,000? Can't they expect a reasonable mark up like other car dealers? Can't they be in line with KBB or the actual used car market? How can Elon call this an appreciating asset and suggest they will take back leased Teslas in the future as a result of that value if they won't even provide reasonable trade in values to current, loyal customers?

The discouraging part was I have sent numerous unanswered requests for help and when I worked through my local Sales guy, noone internal seems to care to address the issue. If anyone knows anyone at Tesla to draw attention to this, as an owner and shareholder I would appreciate it.

Tesla just lost a new car sale for no good reason.

 

[XJ9000]

Just offered my 2018 M3 AWD LR in Silver as a trade in to Tesla to upgrade to a Performance and they said it was only worth $33K. Carvana is quoting closer to $42K to buy it and KBB shows $42K Trade-In for "Good" condition. It only has 11,000 miles so it should be "Very Good" or better. Normally I would just dispose of it third party and call it a day, but in Georgia they charge tax at time of new car purchase and subtract the trade-in value, so looking at an extra $2,800 loss there if I can't trade it in. Tesla expects me to eat $11,800 on top of the $12,000 first year depreciation for a whopping total of $23,800!

As a Tesla owner and shareholder I am very concerned that Tesla is undervaluing the Trade In value of their own cars so drastically. The lowest for sale used 2018 M3 AWD LR on Tesla.com is $46K. So I eat $23,400 and they make another $13,000? Can't they expect a reasonable mark up like other car dealers? Can't they be in line with KBB or the actual used car market? How can Elon call this an appreciating asset and suggest they will take back leased Teslas in the future as a result of that value if they won't even provide reasonable trade in values to current, loyal customers?

The discouraging part was I have sent numerous unanswered requests for help and when I worked through my local Sales guy, noone internal seems to care to address the issue. If anyone knows anyone at Tesla to draw attention to this, as an owner and shareholder I would appreciate it.

Tesla just lost a new car sale for no good reason.

Sell it on Craigslist for $45K

 

[Joshan]

Why do you feel Tesla is the only place to sell your car? A new car seller, is rarely ever the best place to sell your car. Any car dealer, not just Tesla...

 

[killua]

you are mad because tesla wont buy it at your price. Not happy with their offer, dont sell it to them.

 

[NetworkPIMP]

yes, I agree Tesla's offer is garbage... that said... the Carvana offer being $9k more easily absorbs the additional sales tax - which is to say, yes, it translates to only $6-7k more, but that's $6-7k you're not getting form Tesla... The sales tax game here in Indiana is roughly the same, but I got enough of a bump in dealer offers for my 2 trades, that it covered the sales tax increase and took 2-3k off the bottom line as well...

now if Tesla would just get me a VIN and a delivery date already, things would be great, lol

 

[TampaRich]

Tesla is no different than a new car dealership when it comes to low ball trade-in offers. Not sure why you expect different. They don't want to be in the trade-in business. I can't blame them. Carvana is a great option.

 

[insaneoctane]

If the tax savings makes you prefer to trade through Tesla, it wouldn't be unusual business practice to offer you less soon your trade in knowing the value of the tax savings...

 

[rhaekar]

It's funny how you conveniently left out the fact that you got the $7500 federal tax rebate.

Dealer trade ins are always less than selling to a private party.

 

[KenC]

Just offered my 2018 M3 AWD LR in Silver as a trade in to Tesla to upgrade to a Performance and they said it was only worth $33K. Carvana is quoting closer to $42K to buy it and KBB shows $42K Trade-In for "Good" condition. It only has 11,000 miles so it should be "Very Good" or better. Normally I would just dispose of it third party and call it a day, but in Georgia they charge tax at time of new car purchase and subtract the trade-in value, so looking at an extra $2,800 loss there if I can't trade it in. Tesla expects me to eat $11,800 on top of the $12,000 first year depreciation for a whopping total of $23,800!

As a Tesla owner and shareholder I am very concerned that Tesla is undervaluing the Trade In value of their own cars so drastically. The lowest for sale used 2018 M3 AWD LR on Tesla.com is $46K. So I eat $23,400 and they make another $13,000? Can't they expect a reasonable mark up like other car dealers? Can't they be in line with KBB or the actual used car market? How can Elon call this an appreciating asset and suggest they will take back leased Teslas in the future as a result of that value if they won't even provide reasonable trade in values to current, loyal customers?

The discouraging part was I have sent numerous unanswered requests for help and when I worked through my local Sales guy, noone internal seems to care to address the issue. If anyone knows anyone at Tesla to draw attention to this, as an owner and shareholder I would appreciate it.

Tesla just lost a new car sale for no good reason.

So, my LR AWD silver was $55k late last year. Deduct the tax credit, then about $47,500. You drove it 11,000 miles, so a full year's depreciation, so knock off somewhere in the range of $6k, leaving $41,500. And now it's wholesale, not retail, so knock off another $3k, $38,500. I understand the sales tax issue, so trading it to Tesla has some financial advantage, but the Carvana offer is too good even when you factor that in. It'd be like Tesla offering $40k. I think Carvana's offer is right in the ballpark.

Tesla's offer seems very low. Maybe they are stuffed to the gills with new and used Tesla's, and don't want to buy more, so the low offers.

 

[Lhshockey24]

Just offered my 2018 M3 AWD LR in Silver as a trade in to Tesla to upgrade to a Performance and they said it was only worth $33K. Carvana is quoting closer to $42K to buy it and KBB shows $42K Trade-In for "Good" condition. It only has 11,000 miles so it should be "Very Good" or better. Normally I would just dispose of it third party and call it a day, but in Georgia they charge tax at time of new car purchase and subtract the trade-in value, so looking at an extra $2,800 loss there if I can't trade it in. Tesla expects me to eat $11,800 on top of the $12,000 first year depreciation for a whopping total of $23,800!

As a Tesla owner and shareholder I am very concerned that Tesla is undervaluing the Trade In value of their own cars so drastically. The lowest for sale used 2018 M3 AWD LR on Tesla.com is $46K. So I eat $23,400 and they make another $13,000? Can't they expect a reasonable mark up like other car dealers? Can't they be in line with KBB or the actual used car market? How can Elon call this an appreciating asset and suggest they will take back leased Teslas in the future as a result of that value if they won't even provide reasonable trade in values to current, loyal customers?

The discouraging part was I have sent numerous unanswered requests for help and when I worked through my local Sales guy, noone internal seems to care to address the issue. If anyone knows anyone at Tesla to draw attention to this, as an owner and shareholder I would appreciate it.

Tesla just lost a new car sale for no good reason.

You’re not alone. I ordered a Model S and my 5,000 mile FSD Performance 3 with every option came back as a $35,800 trade. Carvana $55,900.
It would have just been easier had Tesla matched like they used to with Carmax so I don’t have to do more than one transaction.

 

[Lhshockey24]

Tesla is no different than a new car dealership when it comes to low ball trade-in offers. Not sure why you expect different. They don't want to be in the trade-in business. I can't blame them. Carvana is a great option.

The thing is, these aren’t low-ball offers. They’re insanely low, with zero explanation laughable offers that further complicate what used to be a pretty simple process with them. You can’t negotiate it either like you can with traditional dealers. +1 for Carvana for sure.

 

[qdeathstar]

Tesla just lost a new car sale for no good reason.

They probably couldn’t make enough money on the deal. Which is a good reason... it’s about money, not customer loyalty, as it should be.

 

[Urbancowboy]

Just offered my 2018 M3 AWD LR in Silver as a trade in to Tesla to upgrade to a Performance and they said it was only worth $33K. Carvana is quoting closer to $42K to buy it and KBB shows $42K Trade-In for "Good" condition. It only has 11,000 miles so it should be "Very Good" or better. Normally I would just dispose of it third party and call it a day, but in Georgia they charge tax at time of new car purchase and subtract the trade-in value, so looking at an extra $2,800 loss there if I can't trade it in. Tesla expects me to eat $11,800 on top of the $12,000 first year depreciation for a whopping total of $23,800!

As a Tesla owner and shareholder I am very concerned that Tesla is undervaluing the Trade In value of their own cars so drastically. The lowest for sale used 2018 M3 AWD LR on Tesla.com is $46K. So I eat $23,400 and they make another $13,000? Can't they expect a reasonable mark up like other car dealers? Can't they be in line with KBB or the actual used car market? How can Elon call this an appreciating asset and suggest they will take back leased Teslas in the future as a result of that value if they won't even provide reasonable trade in values to current, loyal customers?

The discouraging part was I have sent numerous unanswered requests for help and when I worked through my local Sales guy, noone internal seems to care to address the issue. If anyone knows anyone at Tesla to draw attention to this, as an owner and shareholder I would appreciate it.

Tesla just lost a new car sale for no good reason.

I went through a similar trade-in experience (didn't do it). As a Tesla owner and shareholder, you should approach this differently. Keep in mind there is no other automobile manufacturer that will directly buy back its cars. You are comparing apples and oranges.

Let's say you own a little business selling widgets. They are great widgets. People all over the world desire to own them. You can sell them for $1000/ea. Your fully loaded unit cost is $600. Life is good.

Because of the demand for your widgets, there is a vibrant secondhand market where people who can't afford new ones buy them used. In fact a whole bunch of resellers have decided to get into the business of buying and selling your widgets because it's good money. This doesn't bother you at all because there is plenty of demand for your new widgets as far as you can see.

One day, you introduce a new super widget that costs $1500. It's definitely a step up from the original widget, and some of your early widget owners want to upgrade. There are plenty of places they could sell their widgets, but they are asking you to buy them on trade for a new one.

It's kind of a PITA to do this. It takes working capital away from your main business, you have to service/repair/clean the used widgets to get them into sellable condition, and then you have to actually sell them. So you think about it and decide if you're going to do this, it better really be worth it.

You again consider your cost for a brand new original widget is $600, and you can sell those all day long for $1000. $400 profit contribution per unit. Your core business. Seemingly endless demand. Ka ching. Ka ching. Ka ching.

You look at the used market, and it seems widgets sell for between $700-800. You estimate it will cost about $50 on top of your purchase price to buy, hold, service/repair/clean, and sell each widget. Not your core business. Headaches.

So you decide you'll offer $300 per widget on trade so you can maintain similar economics as selling new.

Your customers get really pissed at you and accuse you of undervaluing your own products.

The end.

 

[qdeathstar]

Carvana is going to be a lot better at a making money in a used car than Tesla is. That’s all that they do.

So Carvana might make even more money from the car even if they but it for more and sell it for less just because they are better at it.

 

[Dan203]

I'm surprised they take trades at all. They’re not really a dealer, they’re a manufacturer. I realize that there are special tax incentives to trad-in, rather than sell, in some states and that’s likely why they offer it at all. But that doesn’t mean they have to offer you the best price. In fact it wouldn’t surprise me if they low balled you on purpose to dissuade trad-ins so they don’t have to deal with it.

 

[Lhshockey24]

It takes working capital away from your main business, you have to service/repair/clean the used widgets to get them into sellable condition, and then you have to actually sell them. So you think about it and decide if you're going to do this, it better really be worth it.

This is the best explanation I’ve seen for this scenario. They don’t WANT our trades. They don’t even have enough service staff to fix the new cars coming off the lot. How are they supposed to process a trade in...?

 

[davewill]

A regular dealer who didn't want the trades would just send them to auction, but Tesla probably isn't willing to do that with their own vehicles. That means you may be more likely to get a decent value from Tesla for a non-Tesla vehicle.

 

[JetFalcon]

I wanted to try selling the BMW M3 2013 on Craigslist. But my dad was like "don't care" and sold it to CarMax for only $33k for only 5 years of use & 33k miles. The car was $88k when he bought it, and I know BMW hustled him into the high price b/c he has an obsession for special edition cars.

But I guess its whatever, he makes like $500 hr with the family business so he doesn't care to try sell it privately. He bought a used Mercedes G-wagon, drove for like 3-4 years, and sold it just because it started having problems.

Only car he kept holding onto the longest is a 2002-03 Lexus LX 470. It looks like a piece of *sugar* but he still held onto it over the Mercedes G Wagon. Has 80k miles in 16 years of use.

 

[tvad]

Trading in to a dealer is never the best option for maximising the return on one’s used car.

 

[Dan203]

I wanted to try selling the BMW M3 2013 on Craigslist. But my dad was like "don't care" and sold it to CarMax for only $33k for only 5 years of use & 33k miles. The car was $88k when he bought it, and I know BMW hustled him into the high price b/c he has an obsession for special edition cars.

But I guess its whatever, he makes like $500 hr with the family business so he doesn't care to try sell it privately. He bought a used Mercedes G-wagon, drove for like 3-4 years, and sold it just because it started having problems.

Only car he kept holding onto the longest is a 2002-03 Lexus LX 470. It looks like a piece of *sugar* but he still held onto it over the Mercedes G Wagon. Has 80k miles in 16 years of use.

I'm not quite in the same income bracket as your Dad but I make a decent amount and will tell you that you do get to a point where you value convenience more then a few thousand dollars. I'm likely going to sell my 340i to CarMax just because it's easy. Even though I know I could get several thousand more if I sold it privately. It's just not worth my time and sanity to deal with a bunch of randos from craigslist.