Tesla Model 3 is leading the industry in value retention by barely losing any value after a year and half the depreciation rate as the second-best vehicle, according to a new study.
Last year, CEO Elon Musk claimed that Tesla vehicles are now “appreciating assets” due to their self-driving capability.
He claims that once Tesla achieves full self-driving capability, its vehicles will become revenue-generating assets for their owners, and as the system improves, Tesla will be increasing the price of the self-driving capability, resulting in increased value for all cars.
At one point, Musk even claimed, “Tesla cars should be worth $100,000 to $200,000 with the Full Self-Driving package.”
They are not quite there yet, but they are going in the right direction because the Tesla Model 3 is topping the list of “the best cars to buy new” due to its value retention.
Automotive research firm iSeeCars.com analyzed prices from over 6 million new and used cars sold from August 2019 to January 2020. It identified the top 10 cars that have the lowest price difference from their one-year-old used versions of the same vehicle.
The Model 3 topped the top 10 list with only 5.5% difference in price, or $2,529:
|iSeeCars Top 10 Cars to Buy New Over Used|
|Rank (By Percentage)||Model||% DifferenceNew Over Used||$ Difference|
|1||Tesla Model 3||5.5%||$2,529|
|4||Honda Civic (hatchback)||11.9%||$2,704|
iSeeCars CEO Phong Ly commented on the results:
The Tesla Model 3 had the highest number of pre-orders of any car ever produced, and its backlog of orders helped further drive the high demand for the vehicle. The vehicle didn’t meet its production goals until July 2018, and because it’s so new to the marketplace and because of high owner satisfaction, there is a low inventory of used versions.
The firm also adjusted the price of the Model 3 based on incentives, which negatively affect the resale value of used electric vehicles, although Tesla buyers had access to a lot less valuable incentives during the second half of last year.
That’s impressive. Again, we are certainly not talking about an appreciating asset here, but it’s still incredible for a mass-market vehicle produced in the hundreds of thousands of units per year.
It’s interesting to see some stats, but if you were ever shopping for a used Model 3, you already had a pretty good idea of the situation just based on anecdotal used Model 3 prices.
Like Ly said, inventory is low to start with and the prices are surprisingly high.
Even though the Tesla Model 3 has been on the road for more than two years now and the starting price of a new one is officially $35,000, it’s hard to find a used one for close to $30,000.
It will be interesting to see how it holds up in the next few years with the advent of Tesla’s autonomous driving system.
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