...early buyers/adopters of EVs have been 'screwed' by a combination of lower pricing and better battery technology and car features of newer EV models.
...those who waited got a lower price, a better battery and more car features as well as better leasing options. And this makes people wait and hold their EV purchases, because the bet is that with Chinese EVs going at so much cheaper, Tesla would have little option but to reduce prices to stay in the race.
..it is not surprising then that Elon has decided not to join the Chinese EVs down the road of price obliteration but to turn the tables with his Robotaxi concept. Why buy when you can hop?
Shannon MolloyNews Editor
4 min read
July 4, 2024 - 8:05AM
A second hand Tesla that’s been listed for sale for the past four years without finding a buyer offers a stark insight into the challenges faced by Australians trying to offload older used electric vehicles.
The 2015 Model S in question is almost a decade old and has 115,000 kilometres on the clock, with some visible wear and tear across its interior.
Despite its age and the fact it’s sat unsold since July 2020, the current owner is seeking $86,800, although the price has been discounted by almost $16,000 over the years. Used car valuations site RedBook puts the guide for such a car in a considerably lower range of $51,400 to $57,300.
The RedBook estimated value of a used 2015 Tesla Model S P85D is a fair bit less than one owner is hoping for.
It’s one of almost 1000 used Teslas currently listed on carsales.com.au, ranging from a sleek 2011 Roadster for $349,000 to a stock standard 2019 Model 3 for just $32,000.
Analysis by news.com.au shows a large number of those vehicles for sale have been languishing for several months and up to two years.
“Second hand EVs do pose some challenges for retailers and private sellers at the moment,” Michael Costello from Cox Automotive Australia, which owns the Manheim wholesale auction house
A “perfect storm” of factors have combined recently to deliver generally lower residual values compared to traditional fuel cars, Mr Costello said.
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New EV prices continue to get cheaper, due largely to new Chinese players and Tesla’s ongoing price cuts. When new models get cheaper, you can’t sell an older model at inflated prices,” he explained.
Carsales.com.au motoring reviewer Toby Hagon said a surge in the supply of new Teslas globally, combined with weaker demand for the brand, has seen the US carmaker aggressively discount some of its models in recent times.
“Over the past 18 months or so, there have been multiple price reductions to Teslas, the most recent of which shaved $3000 off the Model 3,” Hagon said. “It’s all aimed at luring more buyers by lowering the price.”
In addition
, rapid advancements in battery technology in the past few years mean older Teslas are beginning to look “a little obsolete”, Mr Costello added.
And then there’s customer anxiety over ageing batteries, which can cost anywhere between $10,000 and $20,000 to replace.“A lack of clarity for consumers around battery longevity beyond the eight-year warranty, and a lack of battery health tests to reassure used buyers, [is another reason].”
“If we look at Tesla specifically, the average residual sold value of a three to four year old Model 3 sold in the past six months is about 65 per cent – or two-thirds of the original new list price.
“By contrast the average retained value of a 2020-build Toyota Camry sold in 2024 is more like 90 per cent, and a Mazda 6 is about 75 per cent.”
A brand-new base Model 3 is about 25 per cent cheaper than it was in 2020, which Mr Costello said is an unusual occurrence.
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Cars rarely get cheaper new list prices over time, so what Tesla has done is unusual. A new Toyota Corolla Hybrid is about 10 per cent to 15 per cent more expensive in 2024 than the car was when new in 2020, which helps keep older models inflated on the used market.”
Analysing the current market for used Teslas on car sale sites, the Model X seems particularly challenging to move, with a number of listings active for up to two years or more.
Despite being eight years old, a 2016 Model X is currently on offer for $99,990. It’s been on the market for some 15 months, but the seller is unwilling to budge much on price, only discounting the price marginally from $115,000.
One 2017 Model X, listed back in November 2022 for $165,000, has had a price adjustment to $150,000.
Meanwhile, a 2017 Model X 90D was listed two years ago for $159,000 but has since been reduced to $115,000. Another of the same variety, listed in March 2022 for $199,990, has had 17 price adjustments since and is now asking $109,990.
A 2018 Model X 75D, first listed almost two years ago for $134,000, has had its asking price dropped to $112,000.
A Model X 100D, also a 2018 model, has seen similar discounting in a shorter time, first listing in January for $135,000 but now on offer for $109,500.
And another 2018 Model X 100D has been listed for two years, first at an eye-watering $199,000 but since adjusted to $145,000 after 10 price updates.
Australian owners of Tesla vehicles flooded social media in May when the latest new car discounting was announced, claiming they had been “screwed” when trying to sell their used cars.
“Not so great for us current owners looking to sell,” one wrote on Facebook. “
Thank you Tesla for screwing your own second-hand market.”Another wrote: “Awesome, my car will be completely worthless when my lease is up. Last Tesla I will ever buy.”
And one was furious to have paid $80,000 just 18 months earlier for a vehicle now priced from $64,900 brand new.
On top of Tesla’s steep discounting, record sales of new cars this year means the number of used vehicle listings have surged, flooding the market with supply and giving buyers more choice than ever.
According to the latest data from the Australian Automotive Dealer Association, used car listing volumes were up by 7.2 per cent in May.
The group’s chief executive James Voortman said the average time it took to sell a used car was 45.5 days, up slightly in the month.
Mr Voortman said that’s “a likely product of the improving supply situation, which is also driving a reduction in retained values across all segments”.
“Vehicles with the strongest retained values are largely sought after and reliable Japanese makes in both the passenger car and SUV segments as well as in the 2-4 year and 5-7 year categories,” he said.
Across 2023, the supply and sales of used EVs nearly doubled, but the market proved to be volatile and prices achieved slipped by 23.4 per cent for models between two to four years old.
In general, the time it took to sell a used EV in 2023 was 75 days on average, which is significantly higher than that of a petrol car
