Trade in values seem high again ?

[Jason71]

I have a trade-in request too but was told I won't receive an 'offer' until i'm assigned a car to prevent the offer from expiring

if that is true then its a new policy. Maybe not a bad one but a new one. Many of us have offers and no car assigned

 

[s88ats]

if that is true then its a new policy. Maybe not a bad one but a new one. Many of us have offers and no car assigned

Sorry, I have been mistaken.

I just reread their email: the reason it is not available now is to reduce any times where the 60 days expire before collection and the vehicle valuation has gone down causing cost impact to yourself.

I assumed this was when a car was assigned but that's not entirely true, my bad.

 

[Jason71]

Sorry, I have been mistaken.

I just reread their email: the reason it is not available now is to reduce any times where the 60 days expire before collection and the vehicle valuation has gone down causing cost impact to yourself.

I assumed this was when a car was assigned but that's not entirely true, my bad.

I think when I got quote most of the delivery window probably was inside the 60days. Then Shanghai shutdown happened so there are a lot of us with orphaned quotes now that will expire before delivery. looks like they maybe trying minimise that happening by holding off which makes a kind of sense. no point giving someone a firm offer that can never be used during the period for which it is valid. Kind of defeats the object of a firm quote

 

[candida]

wondered if someone clever here could explain to an economic illiterate quite how it benefits Tesla to inflate our trade in values so much.

Obviously that makes an assumption - that the values are inflated. I base it on the fact that my tesla trade in figure is now higher than I paid 18 months ago (and no, I'm not complaining). I've got a bog standard white M3P with 13750 miles. These are the figures

Tesla £52,200
Motorway £47,517
WBAC £43,230

To try to unpick value I've searched Autotrader for similar vehicles and the price for car supermarkets for a similar are all within £1k of £51k. I've always assumed that a dealer will want at least 10% profit so assume they've taken the cars in at no less than £46k, this makes Motorway's ranging shot look optimistic and WBAC's price look more like it.

So what does Tesla get from it? New registrations through churn to a dedicated fanbase? What does it do with all the trade ins it's taking in? I'm assuming no one actually buys its used inventory cars - where the closest 2020 car to mine is £1100 less than a brand new one.

I understand that Tesla knows the value of the cars it makes and what it needs to take in profit, but is Tesla's margin on a new car is so huge (this report suggests 32%) that blowing up the new bubble is worth so much more than the inevitable hits on the trade ins? Doesnt feel... healthy? Feels like a bubble. Am I wrong?

Good job I dont fancy the look of a Y.

 

[seadog]

Tesla can add EAP or FSD for "no cost" to your car and increase it's value compared to WBAC or Motorway who can't, trading in also means your buying a new car from them that they are also making a profit on. Still surprised people pay so much for a used Tesla compared to a new one but the now fairly long waiting times for many of the models will make people look at the second hand market if they're not prepared to wait.

 

[Jason71]

wondered if someone clever here could explain to an economic illiterate quite how it benefits Tesla to inflate our trade in values so much.

Obviously that makes an assumption - that the values are inflated. I base it on the fact that my tesla trade in figure is now higher than I paid 18 months ago (and no, I'm not complaining). I've got a bog standard white M3P with 13750 miles. These are the figures

Tesla £52,200
Motorway £47,517
WBAC £43,230

To try to unpick value I've searched Autotrader for similar vehicles and the price for car supermarkets for a similar are all within £1k of £51k. I've always assumed that a dealer will want at least 10% profit so assume they've taken the cars in at no less than £46k, this makes Motorway's ranging shot look optimistic and WBAC's price look more like it.

So what does Tesla get from it? New registrations through churn to a dedicated fanbase? What does it do with all the trade ins it's taking in? I'm assuming no one actually buys its used inventory cars - where the closest 2020 car to mine is £1100 less than a brand new one.

I understand that Tesla knows the value of the cars it makes and what it needs to take in profit, but is Tesla's margin on a new car is so huge (this report suggests 32%) that blowing up the new bubble is worth so much more than the inevitable hits on the trade ins? Doesnt feel... healthy? Feels like a bubble. Am I wrong?

Good job I dont fancy the look of a Y.

Are you sure no one actually buys used inventory cars?
Some people get a warm feeling from the idea of "approved used"
They also seem to throw in EAP with most of them which is worth something to some people I guess.

 

[Tony Hoyle]

EAP is a zero cost to them at resale and also increases the value to the buyer (on the flip side if a car had FSD Tesla can remove it and try to entice the new owner to give them more money for it).

Making the baseline second hand cost so high means the perception of Tesla as a 'high value' brand isn't eroded, so people are more willing to pay for new ones.

 

[candida]

Are you sure no one actually buys used inventory cars?
Some people get a warm feeling from the idea of "approved used"
They also seem to throw in EAP with most of them which is worth something to some people I guess.

I get the warm approved used feeling. There's many brands where I would absolutely want a manufacturer warranty but Tesla have the 4/8 year regardless of the owner, dont they? But I cant imagine anyone would actually choose a 2020 car with EAP at a discount of just £1130 over new to cover someone else sneezing and farting in it for 17000 miles (see below)... I know it takes all sorts and people have different priorities but I just find it mystifying

 

[Jason71]

I get the warm approved used feeling. There's many brands where I would absolutely want a manufacturer warranty but Tesla have the 4/8 year regardless of the owner, dont they? But I cant imagine anyone would actually choose a 2020 car with EAP at a discount of just £1130 over new to cover someone else sneezing and farting in it for 17000 miles (see below)... I know it takes all sorts and people have different priorities but I just find it mystifying



View attachment 797689

yes but you have picked the most expensive. there is one identical on paper with 4K more miles for £6500 less.
Which seems a lot more reasonable but then you have to ask why the difference?
If the cheaper one is in £6500 worse condition I dread to think what that looks like!
seems very random

 

[WannabeOwner]

how it benefits Tesla to inflate our trade in values so much

I think:

Inflates 2nd hand price. That drives new buyers (because total-cost-of-ownership, including residuals, looks better than other brands)

Provides loaner vehicles. Run them as that for a bit, and then sell then as 2nd hand cars. Or only use the ones that won't sell 2nd hand for that purpose, and shift all the others.

Don't suppose 2nd hand vehicles would go to rental companies - but if they do? that would be a route.

Other Brand car dealers will give you discount. Tesla have far more margin than those companies ... and don't give any discount ... but high trade in prices are "discount by another name" and increase brand loyalty etc. etc.

 

[Durzel]

Motorway and WBAC aren't fair comparisons because both of those are buying the car off you, for cash.

As said above, Tesla's price is predicated on you buying another car from them, which they also make a profit on. Then there is the fact that they will be claiming the VAT back when they buy the car from you to sell on (hence the question on the form).

 

[GRiLLA]

I think:

Inflates 2nd hand price. That drives new buyers (because total-cost-of-ownership, including residuals, looks better than other brands)

Provides loaner vehicles. Run them as that for a bit, and then sell then as 2nd hand cars. Or only use the ones that won't sell 2nd hand for that purpose, and shift all the others.

Don't suppose 2nd hand vehicles would go to rental companies - but if they do? that would be a route.

Other Brand car dealers will give you discount. Tesla have far more margin than those companies ... and don't give any discount ... but high trade in prices are "discount by another name" and increase brand loyalty etc. etc.

Tesla also have a sales/delivery team that is big enough to handle the number of vehicles that arrive on boats quickly, used sales is something that keeps them busy and making some profit when the boats aren't arriving. They manipulate what they show on inventory based on their capacity.

 

[Jason71]

I get the warm approved used feeling. There's many brands where I would absolutely want a manufacturer warranty but Tesla have the 4/8 year regardless of the owner, dont they? But I cant imagine anyone would actually choose a 2020 car with EAP at a discount of just £1130 over new to cover someone else sneezing and farting in it for 17000 miles (see below)... I know it takes all sorts and people have different priorities but I just find it mystifying



View attachment 797689

just saw a comment from the US that suggests they put used cars on at a really high price then every few days drop it by a couple of hundred pounds until they sell. I guess you would have to monitor a vehicle to see if this is true for the UK but it might explain why some of the prices seem so high and there is so much variability between what seem to be near identical cars.

 

[Kansalis]

just saw a comment from the US that suggests they put used cars on at a really high price then every few days drop it by a couple of hundred pounds until they sell. I guess you would have to monitor a vehicle to see if this is true for the UK but it might explain why some of the prices seem so high and there is so much variability between what seem to be near identical cars.

Seems to be the case here too. Just picked a random used M3 LR to look at the price history. Check the price history chart bottom left: 2021 Tesla M3 Long Range AWD in GB listed at £ 50,200

 

[WannabeOwner]

you would have to monitor a vehicle to see if this is true for the UK

That was the case when I traded in my MS a couple of years ago.

tesla-info.com is good for that sort of info. Every time a VIN No. comes on the market that site updates its history of the price etc. and any price fluctuations whilst it is being advertised.

 

[Rooster6655]

Tesla £52,200
Motorway £47,517
WBAC £43,230

So what does Tesla get from it? New registrations through churn to a dedicated fanbase? What does it do with all the trade ins it's taking in? I'm assuming no one actually buys its used inventory cars - where the closest 2020 car to mine is £1100 less than a brand new one.

I understand that Tesla knows the value of the cars it makes and what it needs to take in profit, but is Tesla's margin on a new car is so huge (this report suggests 32%) that blowing up the new bubble is worth so much more than the inevitable hits on the trade ins? Doesnt feel... healthy? Feels like a bubble. Am I wrong?

They of course know the supply and pricing data of the Model 3 in the near future so if its supply limited and they are going to increase their prices soon then buying up all the stock makes sense, its also going to cost less for Tesla to fix any damage compared to the others.

They are selling my car for about £9k more than they gave me and added the enhanced autopilot option which is a lot more than the original cost of the car 2.5 years ago, I am sure they will end up selling it for a few more £k than they paid me.

 

[s88ats]

Sorry, I have been mistaken.

I just reread their email: the reason it is not available now is to reduce any times where the 60 days expire before collection and the vehicle valuation has gone down causing cost impact to yourself.

I assumed this was when a car was assigned but that's not entirely true, my bad.

So I was not wrong after all;

"There is no delay caused by not having the final quote, you will receive the final quote when you have been matched to a vehicle as this will ensure we know exactly when the vehicle becomes available and negates the chance of the offer expiring."

 

[Jason71]

So I was not wrong after all;

"There is no delay caused by not having the final quote, you will receive the final quote when you have been matched to a vehicle as this will ensure we know exactly when the vehicle becomes available and negates the chance of the offer expiring."

definite change in policy then. if you read the trade in terms it says ( or did ) that you will get the firm quote within 48 hours of submitting the pictures. Took 2 weeks for me but had nothing to do with being matched

 

[Morak]

For me the final offer arrived once the offer would cover the whole estimated delivery window (Tesla told me it wouldn't be until I was matched to a car, but this turned out not to be the case). That took about 3 weeks. Of course that was before the Shanghai lockdown so it will expire anyway.

 

[Jason71]

In March when Tesla valued my car at over £43K WBAC were valuing it at £36K. Yesterday WBAC they pinged me with an updated price now upto £40.6K.
Autotrader prices are also definitely up can't get an LR M4 for less than about £43K now. a few weeks ago it was more like £40K.
Not sure if this is supply or the price rises but hopefully it means when my current trade in valuation expires the new one will not have dropped off.