The price of used Tesla Model 3 is a roller coaster

All it takes is an announcement from Elon Musk for the price of Teslas on the second-hand market to jump or crash. In this game of speculation, there are sometimes winners, but usually more losers.

The announcement of the arrival of a Model Y for less than €50,000, on August 26, 2022, created immediate enthusiasm. Model 3 owners saw this as an opportunity to upgrade to a more family-friendly model, and hopped on their credit card to order. Except that it clearly played against them on the second-hand market. In the game of supply and demand, some are not immune to a cold shower.

Like the stock market price, the value of second-hand Tesla models can fluctuate, far from the usual curves of the second-hand market of other manufacturers. Buying a Tesla is also a new way of approaching the automobile, with its good and bad sides.

If there are speculative bubbles on vehicles in the luxury and collection segment, Tesla is the first manufacturer to have favored them at its expense on consumer models. It is not the first buyers of the Model S who will say the opposite: they were the first to experience the dizzying discounts following unpredictable announcements from Elon Musk.

When the second-hand price bubble goes *plop*

In recent months, the price of Tesla had followed an upward trend, as for many other recent vehicles. Faced with the shortage of components and the lengthened lead times for obtaining new vehicles, customers have turned to the second-hand market. Demand was strong and sometimes difficult to meet, prices started to climb.

Model Y. // Source: Tesla live capture

After a little over 6 months of driving their Model 3 or Y, some owners were even offered trade-in offers at prices higher than their new purchase price. Several testimonials on private Facebook Tesla groups attested to this possibility of easily realizing capital gains. An exceptional situation, which only works when demand exceeds supply.

Until then, the price curves followed a natural and gradual evolution, upwards or downwards. Except that Tesla’s specialty is to surprise. That’s what the company did on August 26, when it launched the Tesla Model Y Propulsion for less than €50,000. With such an offer, several Model 3 owners, or people in possession of Model 3 or Y purchase orders to be delivered later in the year, placed a new order on the American manufacturer’s site. If we can imagine this kind of spontaneous purchase for the new iPhone 14, it is always surprising to observe it for cars costing several tens of thousands of euros.

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Testimonials on Facebook, about possible capital gains. // Source: Private FB group capture

However, the purchase of the Model Y is generally used to replace the Model 3. Many Model 3s are thus likely to find themselves simultaneously for sale on the second-hand market. Inevitably, when the supply overwhelms the demand, the coast goes down.

The value of a second-hand Model 3 Propulsion was over €43,000 the day before the Model Y was announced. A few days later, it fell to less than €39,000, within companies specializing in the export of Tesla to other markets. Again, there are many testimonials on private groups about Tesla. These companies have even suspended retakes, the time to absorb the influx of requests. Between now and the delivery of the first Model Y Propulsion, the recovery rate curve will certainly continue to fall, unless there is another outburst from Elon Musk announcing the cessation of production of his cars, for example. .

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Examples of very recent Model 3 announcements. // Source: Capture from the Leboncoin site

For sellers, the objective is to have a gap between the sale of their vehicle and the purchase of the Model Y. The reality of the market is likely to be significantly different, especially since many remain convinced that demand is strong. They did not necessarily see that in a few days the number of ads on leboncoin literally exploded (more than 1,000, as of September 9). Pages and ad pages are only a few days old.

For €49,900, a new Tesla buyer is faced with both an offer of a second-hand Tesla Model 3 Grande Autonomie with 55,000 km on the odometer or a new Model Y.

A non-guaranteed trade-in offer at Tesla

It’s a small element that some Tesla customers are also finding out a bit the hard way. Many wanted to take advantage of the takeover offer offered by the American manufacturer. It must be said that the estimates of the trade-in amount are quite good, compared to other rating services.

However, this is a temporary trade-in offer, lasting 7 days. For a Model Y ordered with delivery between December 2022 and February 2023, the estimate provided by Tesla today will no longer be valid when the vehicle is actually taken back. Before delivery of the new vehicle, a new estimate will be made according to the second-hand market price on that date. Suffice to say that some may become disillusioned, if the market is still as saturated with used Model 3s.

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Testimonials on a Facebook group, about covers. // Source: Private FB group capture

With each announcement of lower prices, it is the same observation

At the start of this article, we told you about the example of the first Model S customers. Some were trying to resell their Tesla for €120,000, bought at a higher price a few months earlier. But, it was enough for Elon Musk to announce the same day a significant drop in prices for used models to be more expensive than new ones. Nothing has changed for several years. There are just more models in the Tesla lineup and ever more risk of price yo-yoing.

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Elon Musk. // Source: YouTube screenshot

Both up and down, Tesla’s pricing policy is globally unpredictable. When prices drop, new buyers flock to new models, but used sellers lose money. Conversely, when prices rise, second-hand sellers can make good trades.

This fairly regular fluctuation is really atypical in the automotive industry. Apparently only Tesla succeeds in basing the price of its used vehicles on the same vagaries as its stock market quotations. It is better to know before buying to speculate.

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