Tesla cars are losing their value

Tesla cars are losing their value

Report: Tesla V3 Supercharger Output To Be Increased To 324 kW

Recent price cuts by Elon Musk’s EV maker have sent Tesla resale values dropping at enormous rates

Tesla’s “no haggle” direct-buy pricing model was once heralded as the future of how Americans would buy cars. Several years later, the dealership system is still going strong. Now, according to a recent study, CEO Elon Musk’s insistence on adjusting MSRPs based on market conditions has had detrimental effects on Tesla’s resale value.

Everyone is well aware that the electric vehicle market is facing some challenges. Inventory is building up, and brands struggle to find buyers beyond enthusiastic early adopters. Since the charging infrastructure still has a long way to go to match the convenience of gas stations, many buyers looking to go green are opting for regular hybrids or plug-in models. While traditional automakers have responded by utilizing a lot of discounts and rebates on their electric models, Tesla has slashed the sticker prices to compete. These price drops, combined with lower consumer demand, have had a cascade effect on the used market causing pre-owned electric model values to plummet.

According to a recent study by iSeeCars.com, Tesla’s rate of depreciation from an overall brand perspective vastly outpaces all other automakers.

“iSeeCars analyzed over 1.8 million 1- to 5-year-old used cars sold in February 2023 and 2024. By comparing the average prices of cars by segment, brand and model, the analysis shows a general softening of used car prices overall, but a dramatic drop in used electric vehicle prices.”

According to this data, Tesla models lose value twice as fast as Alfa Romeo and three times as fast as Maserati. This massive depreciation drop is mostly tied to Musk’s decision to constantly cut prices on new models, forcing an ever-widening gap for pre-owned cars.

Even though the Tesla brand has the worst depreciation, because it exclusively makes EVs, the Chevy Bolt is the hardest hit as an individual model when looking at electric cars overall.

According to the iSeeCars data, the top seven steepest depreciating cars are all electric vehicles. Naturally, this is good news for consumers since the top four EVs average under $25,000, which means a potential customer could also qualify for up to $4500 in tax credits for used EVs, bringing the net cost down even further.

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