Should you buy a used Tesla while prices are low?
Used Tesla vehicles have dropped in price in recent months, causing many prospective buyers to consider buying one with a lower price tag and an older battery. There’s a lot to consider when looking at used Tesla vehicles, and one outlet recently looked at the downward trend to see what purchase routes could be best for consumers.
All used Tesla models have gradually dropped in average price on the Cars.com used inventory site since peaking in July, as pointed out by the publication in a recent report. As to how much the recent price cuts on new Tesla models have contributed to the drop, the jury’s still out. But those considering buying a Tesla may be able to find what they’re looking for in used inventories at a more affordable cost.
In January, the outlet noticed that every model year of used Model Y units had dropped by between 2 and 5 percent since peaking in July at an average price of $73,882. The average used Model Y had fallen by about 5 percent since December, and by 23 percent since last July. Tesla’s used Model 3 units followed suit, down 21 percent since July and as much as 7 percent from the average prices in December.
Tesla’s Model S and X vehicles also saw average month-over-month price drops of 4 and 5 percent, respectively, since peak pricing in July. The Model S price dropped 31 percent from peaking at $73,961 in July, also accounting for a 5-percent drop in January from December. The Model X was down by 25 percent from July and 6 percent from December, peaking at $97,898.
A main factor in determining whether to purchase a used Tesla, according to Cars.com, is your overall budget in comparison with the newly effective federal tax credit guidelines. The U.S. government has also extended the federal tax credit to used electric vehicles, offering up to $4,000 on used models. However, used EVs do come with a lower price cap of just $25,000, which doesn’t apply to nearly any used Tesla models.
The best bet for any buyer looking to pick up a used Tesla may be to keep their eyes on falling used inventory levels and prices, coming both directly from the company or from used marketplaces like Cars.com. It’s not clear if inventory levels or prices will keep falling, but with recent spikes in demand, neither is out of the question.
For new models, buyers can score an extra good deal between the full $7,500 EV tax credit and the recent price cuts which dropped price tags on some models by as much as $20,000. Still, these will likely still place new model prices well above used models, so it’s really up to the buyer what their budget can handle.