When Kyle Conner invested heavily in his Tesla Model S, he likely expected to recover a substantial portion of his expenses upon resale. However, he was stunned by its actual valuation.
Conner, who shares content on his YouTube channel Out of Spec Reviews, chronicled the process of selling his electric vehicle, crafted by the Elon Musk-led company.
Initially, Conner disbursed $140,000 for the vehicle in 2022 with plans to sell it in the following year.
The outcome was unexpected.
Chris Pearce, a TikTok user (@thechristopherpearce), discussed Conner’s invoice breakdown, emphasizing the rapid depreciation of Teslas.
Upon reviewing the invoice post-appraisal by Tesla, Pearce discovered that the car had depreciated significantly more than a gasoline-powered car.
The car’s original price was noted at $140,490.
Pearce explained to his audience: “With just 37,000 miles on the odometer, Tesla offered him a shocking $46,400.
“That’s a loss of $94,000 or 67% of its initial value.”
Although Pearce suggested Conner might have received a better offer through private sale, other car appraisal platforms also valued it at less than half of its purchase price.
He stated: “The appraisal was directly from Tesla, so it might be a lowball offer.
“However, platforms like Edmunds or Consumer Reports wouldn’t offer him more than $59,000 at best.”
To compare the Tesla’s depreciation against a conventional gasoline car, Pearce evaluated a BMW of the same cost and year to assess current value.
He remarked: “I found a similar gas vehicle to compare depreciation.
“The BMW M5 CS, released in 2022, similarly priced at $140,000, remains available for around the same price today. This indicates a depreciation of possibly $10,000.”
He also offered a word of caution to prospective Tesla buyers.
Be wary of prominent brands, as their worth might not meet expectations.
A study by Diminishing Value Carolina released in March highlighted that Tesla vehicles depreciate 70 times quicker than Chevrolet cars.
Moreover, brands like GMC and Porsche exhibit some of the lowest depreciation rates in the automotive sector.
Other rapidly depreciating brands include Alfa Romeo, Maserati, Lincoln, and Volvo, following Tesla.
On Reddit’s r/TeslaMotors subforum, users expressed their own experiences and were left speechless.
A Redditor remarked: “Imagine the value drop if lease buyouts were permitted. Tesla’s restriction on lease buyouts likely helps them manage used car prices.”
According to Diminishing Value Carolina’s findings, it’s not just Tesla under scrutiny.
It concerns electric vehicles broadly.
Someone commented: “Tesla’s price might be artificially elevated due to enthusiasts who enjoy the brand’s allure.”
Another user added: “While vehicle depreciation is common, typically it’s around 60% over five years. A 67% loss in two years is extreme.”
Conner has not been thrilled with the attention his car’s depreciation has garnered.
He recently tweeted: “We delivered a highly positive review of the new Long Range RWD Model 3, which went unnoticed. But sharing a single word ‘depreciation’ about a Model S sparked widespread discussion. There’s a strong anti-Tesla bias in the media.”