A writer recently pointed out that Elon Musk promised five years ago that Tesla vehicles would appreciate in value, and they have not. At first, I was thinking, “Well, it’s a bit early to cover this,” but then I realized, it really isn’t. When I bought my Tesla Model 3 … [continued]
After 3 years, most electric cars sold in America are worth less than half what they cost new. The Model 3 is the exception.
You can save tens or hundreds of thousands of dollars with continuous improvements to a Tesla, which is a stark contrast to other automaker that do something else continuously: ask you to pay again!
In reading Tesla’s 4Q Earnings Release, what struck me immediately is that even though they added a lot of production capacity in 2019, both expanding Fremont considerably and building the entire Shanghai Gigafactory in 2019, they spent a little more than half as much on capital as they did in 2018, when they were ramping Model 3 but not building any major factories.
Two of the big pieces of news on the Tesla 3rd quarter earnings announcement were that margins were up dramatically and the cost to build the new lines to manufacture the Model Y in Fremont is half the cost as the existing Model 3 lines, and that the cost to build the Model 3 line in China is 65% less than the same US Model 3 lines on a capacity basis. This means the cost for the Model Y line might cost half of what an existing Model 3 line costs, or it might mean that it costs the same amount of money but has twice the capacity — or some combination of the two.
In a fresh Reddit discussion, the owner of a 7 year-old Tesla Model S explains that his battery is at 98% battery capacity today. This is another reminder of the reasons Tesla cars are much slower to depreciate in value. Any Model S already has long enough range that its battery can degrade significantly and it’s still a highly practical, no-compromises electric vehicle, but seeing such little degradation is that much better for initial owners and used car buyers.
Less than 3 weeks ago, Michael Barnard conducted an analysis for CleanTechnica examining the resale value of the Tesla Model 3 compared to competitors. The conclusion was that the Model 3 was dramatically better at holding its value than other cars in its class.
A study by Autolist of millions of used car listings over many years shows that the Tesla Model S and Model X are worth more after 50,000 miles than any gasoline powered car in their class.
A very interesting discussion relating to the eventual resale value differences between different Tesla Model 3 battery pack configurations was recently begun on the Model 3 Owners Club forum.
I hadn’t personally thought about the subject much at all before reading the discussion, but it makes for a worthwhile line of enquiry. Will early Model 3s with the larger battery pack retain their value notably better than the base level options will?
Depreciation is an interesting creature, and especially so for the fast-changing auto market and newbie electric car market. In my recent article on 30 reasons your next car should be electric, the #1 suggestion for what I left out was depreciation. That could seem like an odd suggestion if you know … [continued]
