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Used P85 pricing

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I agree with the above. I simply wanted to educate potential used buyers about the basic laws of car depreciation and the Tesla demo/loaner program. Even Elon Musk thinks the car will depreciate at rates of 50% MSRP or more by 36-39 mos (as evidenced by the buy-back program). I agree that the market will dictate price; we are starting to see equilibration to realistic selling prices on Ebay with 2 cars in particular that sold for $82,600 and $84,500 respectively. Both are P85s with good option packages. Sellers are asking crazy prices for used MSs; many sellers are trying to make a profit on cars they drive for up to a yr and keep the tax credits for themselves. MSs may depreciate at rates that are slower than usual ICEs for all of the reasons mentioned, but they will depreciate nonetheless. My calculations allow for a lower rate of depreciation as this is a linear depreciation rather than the exponential depreciation you see with typical new ICE cars. Paying close to MSRP for a used one is simply ridiculous; And you lose the tax credits! If anyone has purchased a used P85, please PM me with what you paid, the car's in-service date, date of purchase, mileage, and original MSRP. I am curious to continue this research. Thanks..
 
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Dr Ron, no Musk believes that the cars will depreciate less than 50% in 39 months by offering the buy back plan. You should know that to enact the plan, the buyer must pay off their loan entirely and have title in hand before turning it in for the buy back. It is really more of a financial parachute should someone need to use it.
 
Apparently the only thread in this section the mods pay attention to is mine....so doubtful it will be merged or deleted as it should be.

Apparently the only thread in this section which is being bumped by the owner on a regular basis is ... oh, sheez, never mind. Just poor forum etiquette, that's all. I'd move this thread, just don't have mod privileges over here. It will get moved.
 
Ron, I get that you want the car, but there's a couple of things I don't understand. With all the advantages of buying a loaner that you mention, are you looking into that option?

Also, after your formula you further suggested that a private seller should drop any federal or state tax rebate they received off the price, but I don't think that makes sense. I assume when Tesla says they'll guarantee at least 50% of the sticker price after three years, they're not deducting those rebates. Perhaps I have this wrong... but if that is Tesla's policy, it will have an impact on private pricing as well.

Finally, the 50% guarantee was implemented by Tesla to give early buyers confidence about a minimum residual value for their Model S, and I'm fairly certain I've heard Elon more than once follow it by saying, ~"I expect the cars will actually have a higher residual value."
 
Ron, I get that you want the car, but there's a couple of things I don't understand. With all the advantages of buying a loaner that you mention, are you looking into that option?

Also, after your formula you further suggested that a private seller should drop any federal or state tax rebate they received off the price, but I don't think that makes sense. I assume when Tesla says they'll guarantee at least 50% of the sticker price after three years, they're not deducting those rebates. Perhaps I have this wrong... but if that is Tesla's policy, it will have an impact on private pricing as well.

Finally, the 50% guarantee was implemented by Tesla to give early buyers confidence about a minimum residual value for their Model S, and I'm fairly certain I've heard Elon more than once follow it by saying, ~"I expect the cars will actually have a higher residual value."

And you have to pay the car off before they will buy it back. Unless they changed that rule.
 
The more new Tesla cars that are produced, the more downward pressure there will be on used car prices. Tesla is now at 700 cars per week and will soon to be 1,000 cars per week.

The used car prices will come down sooner rather that later.
 
Tesla Motor's buy-back program offers 50% of the MSRP of the 60 + 43% of any options (inc upgrade to S85 and P85) after 36-39 mos with 15k miles/yr.

One very important distinction here: Tesla guarantees at least 50% + 43%. As in, it's a minimum, a floor. They will pay more if the market demands it, otherwise they'll end up with no one turning in their cars and hence have no certified pre-owned inventory to flip.

You've attempted to calculate depreciation taking into account other car markets, while ignoring both the basic properties of the Model S that limit depreciation (electric motor, aluminum body, exceptionally long battery life) and scarcity in the Model S market.

In the end, the true market price is what the market will bear, where buyers meet sellers at arms length and a sale happens. There is no fairer definition of price.
 
RonMathMD wrote: "Wait times for new cars are at an all time low. "

Waiting 5 to 6 weeks to receive a car after placing an order is not what US buyers are accustomed to. Most buyers are used to walking on to a dealer lot and picking out a car and getting it that day. So the market perception is that one has to wait quite awhile for a Tesla.

Model S demand remains high. Tesla is production constrained and probably will be for years to come. Some used Model S sellers see an opportunity to sell a nearly new S for very close to the original selling price.

Nearly two years after the Model S was introduced there is still no direct competitor from the established manufacturers. All the other EVs are strictly city/commuter cars that are not comparable to the Model S.

These factors, plus the reality that the Model S doesn't "show it's age" like conventional cars do (no rusting, an electric motor that has an extraordinarily long useful life, and an 85kWh battery with active thermal management that will still have 80 to 90% of its original range after more than 100K miles and will still be able to make the distance between Superchargers) means that used prices will remain high until Tesla comes out with a major "refresh" of the Model S, which Elon has publicly stated is several years away.