Originally Posted by
IAHtraveler
IMO, the two differences between Teslas and legacy brands are:
1. Tesla basically has dynamic pricing. They started with stupid high prices, to get the early adopters who were willing to pay a premium. Then as demand decreased, they madt the smart move to get pricing in-line with others to capture the others who are willing to pay similar prices to legacy brands. Those that bought before ~2H last year paid the elevated prices, then watched the sticker prices for new cars drop a ton. They were left with something that had way less value than when they bought weeks or months before. Had they waited a short bit, they could have saved thousands, sometimes tens of thousands.
2. People who were on the wait list could often buy the car new and then sell for an elevated price. For some reason (that defies all economic principles), some thought this would continue. However, as soon as the wait-list ended, why would anyone buy a re-sale vehicle at a higher price than what they could go buy a new one for?
What a lot of people don't know is how legacy pricing works. My dad was an automotive engineer. The first run of a new model always had premium parts. The second they started to get popular, the secondary suppliers were brought in to reduce the cost and it keeps getting reduced until a new model is introduced. I saw this first hand on the 1st generation Altima. The 1993 model was released to compete with Lexus in terms of quiet and refinement, and it did. My 1995 is a reduced cost version and the 1997 models had even fillers for where door lock/unlock switches were as they eliminated even those.
Tesla kinda did the same thing except you saw the differences in the price. Our car came with homelink, the charger bundle--everything but the key fob that cars earlier to ours got. Today, the homelink and charger bundle could be valued at nearly $1000 msrp. So while the car costs less, you get less in some things (more in others). My cousin found this out first hand when he sold his when prices were high to pick up a new one--which didn't have the same premium stereo, or the charger, or a bunch of little things. Sure, it's a newer model that is slicker (I recently had the newest model 3 with me for a few hours while they replaced the front tires on ours), and the newest models are definitely a step up from the older as I was fully impressed, so there is a bit of that going on too as economies of scale kick in.
The concept of a wait-list for a car or anything that matter short of a physical line dumbfounds me. I want a Tesla Roadster, but I'm not going to waitlist for one, especially since in almost all these 'wait-list' cases, the end product differs somewhat from the original promise.
Used Teslas depreciated 30% year on year as of 2024 which is a lot more than a regular new ICE car which is around 20% from new to year one. Perhaps the depreciation will revert to ICE, but I think it will take more discounting with the glut of used Tesla EVs that people don't want. That would explain why Hertz wants them gone ASAP and why I can't rent one anymore from Hertz.
I don't think this was pure depreciation as there were other factors involved such as economies of scale at the manufacturer. I've seen companies slash prices by 50% on things just by moving manufacturing to china--doesn't mean a correlated price drop is just depreciation.
Originally Posted by
Xyzzy
They are g🥲ing away ... I saw this truckload of Tesla vehicles about to drive off at LHR the other day...
Can't wait to read the headlines--Hertz bought 100k Teslas, and is now selling 100k Teslas at a substantial loss. Hertz again files for bankruptcy.'