The Tesla Model Y is known for retaining its value better than many other electric vehicles, which has implications for those looking to purchase a pre-owned one.
Buying a used electric vehicle (EV) can be a daunting task, whether it’s a familiar process or your first time exploring the used EV market. Despite this, there are numerous advantages, including more attractive pricing. Most models that are a year old will have relatively low mileage and minimal wear and tear, particularly if purchased from official dealers.
Take the Tesla Model Y as an example. As one of America’s favorite electric models, it maintains its value well, which means it doesn’t come cheap on the used market. Studies and appraisals suggest that even after a year, the Model Y’s value typically depreciates by only a few thousand dollars from its original price, an important consideration when budgeting.
Tesla vehicles are generally positioned in the luxury segment, which influences their higher resale value and pricing. A variety of used Model Ys can be found at Tesla showrooms, online, or through authorized resellers. It’s crucial to ensure that any used Model Y is purchased from a reputable source to avoid potential risks.
Model Y’s Decent Value Retention: A Word of Caution for Buyers
Tesla vehicles are known for their value retention. According to CarEdge, the Tesla Model Y can retain about $3,400 of its value in the first year. Based on the 2023 Model Y price of $43,990, this suggests a one-year resale value of approximately $40,590. However, the exact figure can vary and should be verified with the dealer and their inventory. Some used Model Ys, especially those with additional features, may command a higher price than base models. For the best deal, a base trim Model Y is often the preferred choice, as it’s unlikely to show significant use after one year unless the previous owner was careless.
Electric Models and Immediate Value Loss
It’s a common misconception that electric vehicles don’t lose value immediately after purchase. While it’s true that EVs can lose more value on a yearly basis compared to internal combustion engine (ICE) vehicles, this doesn’t necessarily mean that buyers will find great deals on the used market. Over the first five years, an EV can depreciate by as much as 50 percent or more. CarEdge estimates that a Tesla Model Y could depreciate by around 23 percent after three years, which, while not disastrous, isn’t particularly favorable either.
The Tesla Model Y Has Yet to Receive a Major Refresh
Since the Tesla Model Y’s debut in 2022, it hasn’t undergone significant changes, which contributes to its strong performance in the used market. In contrast, the Model 3 has recently received a Highland refresh, which significantly updated its cabin and exterior. This update may affect the resale value of pre-2024 Model 3s, but the Model Y isn’t facing the same issue.
Fortunately, the Model Y is scheduled for a redesign, although it hasn’t happened yet. This puts buyers and sellers of used Model Ys in a favorable position this year. Generally, the more a model changes over time, the less a used version is worth, unless it’s a vintage or collectible model, which the Model Y is not.
Model Y as a Safe Investment
The Tesla Model Y is considered a good investment for several reasons. Its modern design makes it feel cutting-edge compared to other models in its class. The Model Y lineup consists of three distinct trims: Base ($43,990), Long Range ($48,990), and Performance ($52,490), all priced as of 2023. Despite its relatively small lineup, the Model Y is popular and often seen on roads across the United States, indicating ongoing demand.
Current Challenges in the Auto Market
The new and used car market is currently facing difficulties, with manufacturers struggling to sell excess inventory and adjusting prices accordingly. Additionally, EV tariffs on foreign-made models are impacting the market, with some even delaying future EV plans. Despite these challenges, the Tesla Model Y has remained resilient, as evidenced by its depreciation values.
There are still opportunities to find great deals on electric cars, both new and pre-owned, including the Model Y. The Tesla website features a ‘New & Used Electric Cars’ section, where some Model Ys are listed at attractive prices for 2021 models. While these may not be the latest versions, they could still offer good value.
Model Y’s Value Retention and Used Car Purchasing
Although the Tesla Model Y holds its value better than average EVs, it’s still possible to find used models for less than their original retail price. The availability of such deals depends on where you shop. Dealers with excess Model Y inventory might be more willing to negotiate on price. Market saturation can also lead to lower prices as dealers need to attract buyers.
If you’re looking to buy a pre-owned Tesla, timing your purchase around the release of a new version could result in better deals at dealerships. It’s essential to monitor prices, make inquiries, and assess the local market saturation.
2021 and 2022 Model Ys Offer the Best Value
When buying or selling a used Model Y, the 2021 and 2022 models tend to offer the best value and pricing. These vehicles are unlikely to have high mileage or significantly degraded battery performance. Tesla’s authorized pre-owned program allows buyers to explore the brand’s used inventory, place a deposit, and have their chosen Model Y shipped to their U.S. address, making the process straightforward.
