Used Tesla Model Y: The Struggles of Individuals

This page is translated from the original post "Tesla Model Y d’occasion : parcours du combattant des particuliers" in French.

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Tesla Model Y La Centrale occasion

Now, a 2022 used Tesla Model Y, with less than 30,000 km on the clock, costs less than 30,000 euros… before negotiation.

When Tesla slashes new car prices, the headache shifts to the used car market. Just take a look at France’s leading used car listings site, La Centrale, to see the extent of the problem.

When searching for a Tesla Model Y with a maximum of 30,000 km, one finds hundreds of listings. There are cars sold by individuals, but also a plethora of vehicles returning from LOA (leasing with purchase option) or LLD (long-term leasing). The flood of used cars is therefore enormous.

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Used Tesla, a downward spiral?

Variations Price Tesla Model Y Used
Sellers minimally adjust their used Tesla prices down by 3000 euros. @La Centrale

Owners of Teslas seem trapped in a downward spiral: despite successive price drops, the cars struggle to find buyers. The listing of a Model Y in the Paris region exemplifies this phenomenon: 2022 model, 25,800 kilometers, and less than 30,000 euros before negotiation (inevitable). The seller, forced to gradually lower the price, faces a wall of hesitant buyers. Behind this specific case, the entire used car market is shaking under the impact of the aggressive commercial strategy of the Californian manufacturer.

In this instance, new cars overshadow the price of the used, especially when returns from leasing are coupled with new Tesla Model Y arrivals at the beginning of the year. The appeal suddenly collapses for the old generation…

In traditional automobiles, manufacturers have always strived to prevent too visible price drops. The residual value of vehicles is indeed one of the pillars of buyer confidence.

However, Tesla has disrupted this logic by implementing massive and sudden discounts on its new models, sometimes of several thousand euros. The direct consequence is that vehicles already on the market see their value plummet overnight. A Model Y Propulsion paid €42,000 in 2022 can be outcompeted a year later by a new model offered at €39,990. Who will pay more for a used car than its brand-new equivalent?

Lengthening sale periods

This sudden drop in residual values leads to a significant lengthening of sale periods. The numbers confirm this trend: according to our colleagues at L’Argus, the average storage time for a used vehicle at professionals recently reached 86 days for a diesel, 101 days for a petrol, and 122 days for a hybrid. Individuals can sometimes conclude sales faster, averaging around a month and a half (45 days), but only if the price is perfectly aligned with the market. In the case of Teslas, the constant comparison with new blocks any fluidity: listings stagnate, prices drop, buyers are still waiting.

Traditionally, the negotiation margin for a used car is between 5 and 15% of the listed price. But with the current volatility of Tesla prices, potential buyers have a compelling argument: why pay a premium for a used car when the price of new cars keeps falling? The pressure is such that sellers, both private and professional, must lower their expectations or face interminable delays. The balance of power clearly favors buyers, but at the cost of general instability that threatens the entire market.

Is Tesla playing a dangerous game?

Tesla’s approach is more akin to the high-tech sector than to the automotive industry. Like a smartphone, the manufacturer adjusts its prices in real-time, based on demand and competition, without regard for the resale value of models already sold. But unlike a phone, a car represents a significant investment that also relies on the hope of recouping some of its value upon resale. By disrupting this balance, Tesla has created a precedent that shakes customer trust and undermines the work of dealers specializing in used cars.

For buyers, the lesson is clear: before investing in a used Tesla, it is essential to systematically compare with new, as depreciation might be much more brutal than expected. For sellers, however, it’s an almost unsolvable equation: how to sell a vehicle whose reference price, that of new, keeps slipping away?

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