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

69 points| bluedino | 3 years ago |reuters.com | reply

172 comments

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[+] davidw|3 years ago|reply
Musk getting very political is going to have an impact on people who drive EV's for reasons that may be somewhat political, and politically opposed to where he's going. Will his politics draw in people on the other side who were previously skeptical of EV's? I have no idea, really, about the numbers involved in either case.
[+] kweinber|3 years ago|reply
We were about to be a two Tesla house this year and now there is 0% chance we’ll be that after the latest shenanigans. Although my car is well made, I’m a little embarrassed to drive it around now.
[+] ilrwbwrkhv|3 years ago|reply
Nobody likes dicks. pg wrote about it here http://www.paulgraham.com/good.html

Elon became a dick. Maybe he was always one, maybe he became one. Punching down makes you a dick and he has been doing it again and again.

Claiming autism will not save him.

[+] smt88|3 years ago|reply
I doubt the effect of his politics is huge. Most people are totally unplugged from politics, and a lot of his buyers were Republicans anyway. Even the progressive people who hate him may still buy the cars because people don't often act on their beliefs.

I suspect the following have had bigger effects on their sales:

- Tesla being at the bottom of quality rankings (and lots of evidence of major quality issues)

- increasing numbers of fantastic EVs sold by other companies at all price points

- bad PR related to "FSD" and "Autopilot"

- higher interest rates preventing financially irresponsible people from buying cars for status

[+] nobodyandproud|3 years ago|reply
I don’t care about Elon’s erratic politics, but I have no desire to be a perpetual beta tester.

I like my cars boring and reliable.

[+] elif|3 years ago|reply
From what I can tell as a Tesla owner that responds to a lot of Tesla Internet comments, teslas appeal historically has actually been broad politically. The biggest limiting factor of appeal is price, with a lot of people either perceiving the vehicles as expensive for their value or just being hopelessly priced out of luxury car prices generally.

From that perspective, people dig into anecdotes about repair costs, motor/battery replacement, electricity costs, cold weather, etc to self-justify.

I don't see a lot of ideology-based resistance or support for that matter.

[+] daveguy|3 years ago|reply
Hard to tell whether the FSD debacle is more or less of an influence than the politics. At first there was all kinds of video showing Tesla avoiding accidents. Now all the videos seem to be about how careful you have to be to avoid plowing into a pedestrian or a concrete planter. Or how poor the auto-parking is compared to electronic vehicles from other manufacturers. Tesla's software features have gotten objectively bad.
[+] klroberts|3 years ago|reply
He really didn't change that much. The "left" did not have a problem with his tweets or Tesla autopilot failures before he took over Twitter.

Only when he threatened their censorship and their incomes, which are largely based on creating narratives and inventing new social justice causes, the "left" started to lash out.

I do think the TSLA related issues have little to do with the backlash and more with various economic fundamentals.

[+] LarryMullins|3 years ago|reply
> Will his politics draw in people on the other side who were previously skeptical of EV's?

Not a snowball's chance in hell. The hangup most people have with EVs is the price and the uncertainty that the car would sustain their lifestyle (which is particularly a concern for people living outside of cities.) It was never "EV car execs are insufficiently conservative."

[+] mlindner|3 years ago|reply
There's an entire half of the population that's on the other side of the matter that will now be similarly interested in buying for the same reasons that the other side is now against buying. However most don't and won't care.
[+] TradingPlaces|3 years ago|reply
Everyone wants this to be about politics, but that elides the fact that he looks like an utter clown every day to anyone who understands software, social media, or finance.
[+] seanmcdirmid|3 years ago|reply
Very few people are buying EVs for political reasons. It’s just a dumb way to make a political statement.
[+] VirusNewbie|3 years ago|reply
Well Tesla’s next big product is allegedly a giant pickup truck.
[+] rvz|3 years ago|reply
Only the techies here and the Tesla stock bag-holders who bought at the top of the bubble care about Musk's political leanings. Tesla has been doing just fine despite the competitors catching up which I already expected to happen as the stock was priced in years ago due to the hype. [0]

This comment sounds like a overreaction due to Musk taking over Twitter. Generally, people couldn't care less and are still buying and driving Teslas just like how many people still choose to drive Volkswagons despite the founder of the German Labour Front, Adolf Hitler being the founder.

Little to no one cares about the political stances other than the techies and bag-holders here as the cars are fine. Anything that is worth the criticism would be the safety of the FSD system which is a total scam that is rightfully under investigation and puts the lives of drivers on the road at risk.

Thankfully, at least it is a optional system.

[0] https://news.ycombinator.com/item?id=27966105

[+] redox99|3 years ago|reply
I think this is vastly overblown. Your average Joe barely knows who Elon Musk is.

Unlike most of us here, most people aren't up to date on whatever X individual tweeted or said.

Edit: Downvoted for giving my opinion, stay classy HN.

[+] newZWhoDis|3 years ago|reply
Elon’s Twitter posts have zero impact on anything related to the car. The people allowing that to shape their purchasing decisions are underdeveloped emotional children.

Adults buy a vehicle based on specs, price, build quality, and style.

[+] QuantumGood|3 years ago|reply
Well, far on the "other side" are people who do coal running (black exhaust) and ICEing (blocking EV charging spots). So peer pressure (a very big thing at the extremes) has moved closer to the center, so that's one limiting factor.
[+] michaelbuckbee|3 years ago|reply
It's the quality issue for me; someone described their Tesla as "Imagine if your printer was your car."
[+] csa|3 years ago|reply
> someone described their Tesla as "Imagine if your printer was your car."

I hope you don’t defer judgment on other things to this “someone”.

There are many Tesla owners (e.g., myself and several of my friends) who are just quietly enjoying our cars.

[+] Method-X|3 years ago|reply
Have had a Model 3 since 2018. Zero issues. Same for friends.
[+] hnburnsy|3 years ago|reply
Used Teslas will be eligible for a 4500 tax credit in 2023, I assume many are waiting.
[+] cma|3 years ago|reply
Only for used electrics that cost under $25,000. The cheapest Tesla I see on Carvana is around $38K.
[+] jmyeet|3 years ago|reply
As much as many of us would like to attribute this to Elon's recent arc of desperately seeking approval from the Gamergate crowd hurting the Tesla brand (which it does), this is really just the used car market returning to Earth.

Like many things, car demand fell off a cliff in 2020 and then roared back to life in 2022. There was lots of shuttered capacity and it takes time to ramp that up. Since most cars are produced overseas, this was doubly hurt by sea freight demand also going through the roof. Of course this increased demand for used cars.

6-12 months ago you'd see story after story of 2 year old cars having trade in values of basically the new sticker price. That was never going to last. Either the new prices were going to go up (which some did) or used prices were going to crash. New car production finally caught up and used car prices have started to crash.

There's a lot of speculation that this is going to cause a lot of issues with underwater auto loan debt. We will see.

Tesla has the additional issue that more and more EV options are becoming available.

So I really don't think this has much to do with Musk at all.

[+] cma|3 years ago|reply
Tesla/Musk held a presentation in 2019 (Autonomy Investor Day) where he said you would be crazy not to buy their cars, they will be the first appreciating assets and likely go up over $200K due to their robo taxi network going online across the nation in 2020. He said they would handle all human drivable conditions by then and that they just needed winter 2019 to finalize ice and snow autonomy.

They did turn out to appreciate, but so did the whole used car market, for very different reasons.

[+] eightysixfour|3 years ago|reply
Not only this, but gas prices are back down too. If you chart the sale of hybrids and such with gas prices, demand tracks pretty closely. Car market coming down from the stratosphere, impending tax credits, and reduced gas prices are a perfect storm for Tesla prices to fall like a rock.

They have a high unit margin and room to bring prices down, but there is substantial danger as others pick up the competition. Rumors of a Model 3 refresh soon are also floating, which may give the informed buyer some pause.

[+] xnx|3 years ago|reply
The stock prices was inflated because people thought Tesla was the iPhone of cars. Recently it seems they're closer to being the My Pillow of cars.
[+] vardump|3 years ago|reply
Other than hyper-luxury brands, which manufacturer commands margins higher than Tesla's?
[+] RickJWagner|3 years ago|reply
I can't imagine taking company ownership into consideration when buying a car, especially something as different as an EV. (Volkswagen ownership, anyone?)

If Tesla prices are going down, it's a boon for practical-minded people.

[+] 1970-01-01|3 years ago|reply
Apples and oranges yet again. Don't compare Tesla to others until others have more than 80% of their used inventory as EVs. Until then, it's apples and oranges.
[+] sys_64738|3 years ago|reply
I made my cash by flipping TSLA stock a while back. I wouldn't actually buy one as I don't believe in their product.
[+] bpodgursky|3 years ago|reply
Most Tesla sales aren't even in the US.

Pretty sure consumers in China and India are not especially bothered by Musk's Twitter antics.

[+] camdat|3 years ago|reply
Teslas generally aren't available in India. Import duties are high for foreign vehicles (like "100% of vehicle cost" high) , and Tesla doesn't have Indian factories.