Tesla used-car price bubble pops, weighs on new-car demand

The average used Tesla price in November was $55,754, down 17% from the July high of $67,297. According to Edmunds’ data, the overall used car market fell 4% during that period. Used Tesla cars were in dealer inventory for an average of 50 days in November, compared to 38 days for all used cars.

Rising gas prices due to the Ukrainian war boosted demand for Tesla, one of the few long-range electric vehicles on the market. Tesla Inc.By itself it raised prices faster than other cars and increased profit margins. Also, some new Tesla car buyers are taking advantage of the booming market to sell relatively new cars in order to make a profit, ordering new cars to meet demand for new Tesla cars. pushed up.

Now that fuel prices are falling and interest rates are rising, Tesla’s output is increasingWhen EV competition intensifiesleading used Tesla prices to fall faster than the market, with a cascading effect on new Tesla prices.

Tesla last week New car prices in the U.S. dropped to $7,500 Investors are becoming more concerned about softening demand for the Model Ys and Model 3s delivered this year.

Nearly a third of Tesla’s used cars sold in August were 2022 models, which it plans to resell, analysts said. That compares with about 5% of other brands on the used market, according to research firm Edmunds.

“You can’t sell your current Tesla for more than you paid for it,” said Karl Brauer, executive analyst at car sales website iSeeCars.com. It would reduce demand for new Teslas.”

On Thursday, Musk said that “rapid changes in interest rates” have pushed up the price of all cars, both new and used, and that Tesla could cut prices to keep volumes growing. Yes, which could result in reduced profits.

Tesla, which has dissolved its media relations department, did not respond to Reuters’ e-mailed inquiries.

Certainly, Tesla is not the only one. The U.S. used-car market, which thrived after being hit by global auto manufacturing, is now facing a “used-car recession,” one analyst said after used-car sellers. I was. CarMax last week reported an 86% decline in third-quarter earnings..

But Tesla is leading the pullback. The factors driving up the price of the company’s vehicles were exaggerated compared to other brands, so Tesla “was basically the only viable product when it came to second-hand EVs for a long time,” says Ivan Drury. the director said. Insights from Edmunds.com.

EVs such as the Ford F-150 Lightning and Hyundai Ioniq 5 are making headlines in the market, said Liz Najman, content marketing manager at EV research firm Recurrent.

Software engineer Greg Profitt bought a new Model Y last year for $49,000 and sold it three months later for another $12,000. He ordered a new one, but he just bought a used Tesla at a discount.

“Because of the economy, it’s a little scary to buy new,” he said, adding that the new $7,500 discount would be too little to sustain demand.

This article was optimized by the SEO Team at Clickworks SEO

Source link