You Should NEVER BUY A New Tesla

Summary

In this video, a used car dealer discusses the dramatic drop in value of Teslas and the broader EV market. Over just five years, a Tesla can lose over $80,000 in value, and with new legislation removing government incentives like tax credits, the situation is expected to worsen. The dealer shares his experience of losing money on a 2019 Tesla Model 3 and offers advice for potential buyers. He recommends waiting until the end of the year before purchasing an EV, especially a Tesla, and buying used rather than new to avoid rapid depreciation. Additionally, buyers should be cautious of battery warranties when buying used Teslas.

Takeaways

• 😀 Tesla has lost over $80,000 in value in just five years, signaling a potential decline in the EV market.
• 😀 A new bill will eliminate EV tax credits for both new and used EVs, making electric vehicles more expensive for consumers.
• 😀 The reduction of government tax incentives could lead to a major drop in EV sales, especially for Tesla vehicles.
• 😀 The used Tesla market is already facing significant price drops, with a 2019 Tesla Model 3 losing $5,000 in value in just a year.
• 😀 Dealers, including the speaker, are struggling to sell used EVs, with some not getting any calls on vehicles for weeks.
• 😀 A 2019 Model S lost significant value after being sold for only $20,000, compared to its original price of over $100,000.
• 😀 A dealer's attempt to sell three Teslas for months without success shows that the EV market is struggling, even at lower prices.
• 😀 The removal of tax credits will likely force Tesla to lower its vehicle prices in order to remain competitive.
• 😀 Buyers should avoid purchasing a new Tesla due to rapid depreciation, as the value of these cars drops sharply after purchase.
• 😀 For those interested in buying a Tesla, it’s better to buy a used model, but ensure it's still within the battery warranty period for peace of mind.

Q & A

How much value has the Tesla in the example lost over five years?

The Tesla in the example has lost over $80,000 in value in just five years.

What recent bill will affect the EV market and how?

A recent bill will phase out government tax credits for EV purchases. Currently, new EV buyers receive a $7,500 tax credit, and used EV buyers receive around $4,000. This change is expected to negatively impact the EV market, especially Tesla.

Why is the speaker concerned about the future of the EV market?

The speaker is concerned that the loss of tax incentives, combined with an already weak EV market, will lead to more price drops and difficulty selling EVs, particularly Teslas.

How much did the speaker lose when selling a 2019 Tesla Model 3?

The speaker lost $5,000 when selling a 2019 Tesla Model 3. They bought it for $18,000, but had to sell it for $13,000 after struggling to find buyers.

What happened to the wholesale value of the speaker's Tesla in a year?

The wholesale value of the speaker's 2019 Tesla Model 3 dropped significantly, from $18,000 to potentially as low as $11,000 in just a year.

What does the speaker recommend for people thinking about buying a Tesla?

The speaker recommends waiting until at least the end of the year, after the tax credits expire, to see how prices and the market evolve. They suggest avoiding buying a new Tesla due to the rapid depreciation and considering a used Tesla instead.

What is the key reason people avoid buying used Teslas, according to the speaker?

People avoid buying used Teslas primarily because they fear potential battery issues, which can be costly to fix, around $15,000. However, the speaker recommends buying a used Tesla as long as it is still within the battery warranty period.

Why does the speaker believe Tesla will likely lower prices after September 1st?

The speaker believes that after the tax credits expire on September 1st, Tesla will lower its prices to remain competitive and to compensate for the loss of government incentives that currently help make their cars more affordable.

How does the speaker feel about the quality of Tesla's Model 3?

The speaker expresses dissatisfaction with the Tesla Model 3, stating that it feels like a fast 2005 Kia Spectra rather than a luxury car. They believe it doesn't justify the price for a car of its class.

What are the speaker's personal plans regarding purchasing another Tesla?

The speaker does not plan to purchase a new Tesla in the near future due to rapid depreciation. If they were to buy another Tesla, it would be a used Model S, similar to the one they already own.