Used Tesla Prices Are Dropping Fast, Study Finds

Last month we shared that used car prices dropped for two consecutive months in November and December - with the Tesla Model 3 seeing the biggest drop. 

It's a trend that is continuing with iSeeCars now reporting that used Tesla prices are falling three times faster than the market average. As of February 4th, the automotive research company cites:

• The average late-year Tesla used car value has dropped 4.8 percent in just the past month, this compares to a 1.5 percent drop across all late-year used cars in the same time period
• Additionally, researchers say plug-in hybrid vehicles are also declining at a faster rate.

Used Tesla Values Take a Big Hit in January

iSeeCars says while used car prices are dropping across the board, Tesla models experienced some of the biggest price drops in recent months. For example, used Tesla Model 3 prices dipped 16.8 percent between September and December of 2022. The decline accelerated when Tesla slashed new vehicle prices on January13th, 2023.  Researchers say Tesla cut prices to better align Tesla’s pricing with recent government legislation,  though falling sales volume and rising inventory levels, across the industry and for Tesla specifically, suggest these cuts were also made to ensure new Teslas continue to move in a softening economy. 

iSeeCars analyzed Tesla used car prices between January 3rd and January 11th, the day before the price cuts were announced. Then it compared those to used Tesla prices between January 15th and January 31st, immediately after the announcement.  Through the comparison, iSeeCars says it confirmed a 4.8 percent drop in Tesla values.  

The drop was lead by used Model 3 values which fell 5.2 percent after the price cuts. Model X prices declined the least, down 3.9 percent. These drops meant price reductions between $2,354 and $4,626 depending on the model, all in less than a month.

iSeeCars also notes that search activity for Teslas skyrocketed in this same timeframe, up 21.3 percent versus an average of 6.5 percent for all used cars on iSeeCars.com.

Non-Traditional/Alternative Fuel Vehicles Dropping Faster than ICE Vehicles

The drop in used car prices - especially alternative vehicles - is not limited to Tesla. iSeeCars also reports that prices of alternative fuel vehicles dropped faster than traditional gasoline models in the past month.  Used plug-in hybrid dropped the most in value with a decline of 3.8 percent. Electric vehicles dipped 1.8 percent, only slightly ahead of the industry average. iSeeCars says that further illustrates Tesla’s substantial drop in value versus the overall EV market.

For more research visit iSeeCars.com.

Photo Courtesy of Tesla.