Why are Tesla Model 3 so cheap width

Used Teslas are getting very cheap, but buying one can be risky

The launch of a new electric vehicle these days is invariably met with a chorus of "this car is too expensive"and rightfully so. But for used EVs, it's quite another story, particularly used Teslas, thanks to a glut of former fleet and rental cars that are now ready for their second owner.

"Due to a variety of reasons, Tesla resale values have plummeted, making many Tesla models very affordable now. Plus, for some consumers, an additional $4,000 Federal tax credit on used EVs may apply, sweetening the deal even further. Buying a used Tesla can be a great deal for the savvy shopper, but there are significant things to look out for," says Ed Kim, president and chief analyst at AutoPacific.

Indeed, a quick search on the topic easily reveals some horror stories of ex-rental Teslas, so here are some things to consider if you're in search of a cheap Model 3 or Model Y.

For more than a year, Tesla has been engaged in an EV price war, mostly driven by its attempt to maintain sales in China. Heavily cutting the price of your new cars is a good way to devalue the used ones, and Hertz's decision to sell at least 20,000 of its Teslas was in part a response to the lower residual values.

What to watch for

"The prices are very appealing, but shoppers must keep in mind that rental cars can and do get abused, and some of these ex-rental units may have nasty surprises stemming from their hard lives. Be sure to have yours checked out thoroughly by a mechanic before buying," Kim says.

Mismatched tires and minor dents, scrapes, and rock chips are fairly common minor issues. Many of the Teslas that Hertz is selling have been used as Ubersyou can tell it's one of these if the odometer is approaching 100,000 miles. Battery degradation could be an issue, although most cars will not have lost more than 45 percent capacity, and Long Range Teslas should have a powertrain warranty for up to 120,000 miles (or eight years).

"One side effect of Teslas widespread and reliable DC fast charging network is that many owners end up relying on it to keep their cars charged rather than dealing with the often considerable expense of installing a home charger and associated home electrical upgrades," Kim told Ars. As such, you should make sure to check the battery's health (which can be done on the touchscreen or as part of the inspection) before you buy.

Rental cars can suffer from an excess of slammed doors and trunksslamming the latter can mess up the powered strut. In the interior, you should expect high signs of wear on some touchpoints, especially the steering wheel and the rear door cards, which can bubble or flake, particularly if the Tesla was used as a ridehailing vehicle.

Other potential headaches

Teslas are very connected cars, and many of their convenience features are accessed via smartphone apps. But that requires that Tesla's database shows you as the car's owner, and there are plenty of reports online that transferring ownership from Hertz can take time.

Unfortunately, this also leaves the car stuck in Chill driving mode (which restricts power, acceleration, and top speed) and places some car settings outside of the new owner's level of access. You also won't be able to use Tesla Superchargers while the car still shows up as belonging to Hertz. Based on forum reports, contacting Tesla directly is the way to resolve this, but it can take several days to process; longer if there's a paperwork mismatch.

Once you've transferred ownership to Tesla's satisfaction, it's time to do a software reset on the car to remove the fleet version.

Not every car will qualify for the $4,000 IRS used clean vehicle tax credit. It has to be at least two model years older than the calendar year in which it is bought used, so only MY2022 and earlier EVs are currently eligible, and it can't be offered for sale for more than $25,000. The income caps are also half as much as the new clean vehicle tax credit, meaning a single-filing individual can't earn more than $75,000 a year to qualify.

There are plenty of complaints among the Tesla community that Hertz wasn't set up to deal with the tax credit, although more recent buyers have reported this has gotten a lot smoother. It's worth planning ahead and contacting the specific sales branch you plan to buy the Tesla from to make sure they are able to process that paperwork, particularly if you are expecting the credit to be applied to the car's price at the point of sale rather than waiting until you file your taxes next year.

Buying an ex-rental or ex-fleet Tesla from an independent dealer is also an option. Lots of used car lots have bought Teslas at auction from Hertz and elsewhere, and online anecdotes suggest this is often a more painless experience, particularly when transferring ownership and registering the new owner with Tesla. Then again, you're more likely to encounter useless third-party warranties and the like if you go this route.

Ex-rental or fleet cars may have had a hard life, but they are also usually maintained far more regularly than most privately owned vehicles. As long as you make sure you aren't buying a lemon, it's a good way to get an EV for less than $20,000.

Tesla prices keep dropping, Model 3 & Y now at lowest prices ever

Tesla prices have been falling all year, and today weve got another price cut to report on most trims of Teslas most popular models, leaving the Model 3 at the lowest price its ever been.

Model Y Long Range & Performance are $2K cheaper

The Model Y Long Range and Model Y Performance are both now listed for $2,000 less than they were earlier today, with the Model Y Long Range going for $48,490 and the Model Y Performance going for $52,490 on Teslas website.

Previously, the models started at $50,490 and $54,490 respectively.

The change comes days after Tesla introduced the cheapest Model Y the US has seen, the new Model Y Rear-wheel drive, which starts at $43,990. That model was not subject to todays $2K price drop, and remains at the same price it was introduced at earlier this week.

Model 3 is now the cheapest Tesla ever

The Model 3 has also seen a price reduction, with all three trims getting discounted as compared to earlier today. The Model 3 Rear-wheel drive and Long Range versions both get a $1,250 price cut, and the Performance model is down $2,250 from previous pricing.

These models now start at $38,990 for the RWD, $45,990 for the LR, and $50,990 for the Performance model. Previously they sold for $40,240, $47,240, and $53,240 respectively.

The new prices mean that with even modest state, local, or regional tax credits, on top of the $7,500 federal credit, a new Model 3 could cost less than $30K for the right buyer. This is the cheapest new Tesla ever, save the questionably briefly available $35K Model 3 though between inflation and more tax credit availability now than at that time, todays Model 3 is an even better deal than that one would have been.

The Model 3 recently got a big refresh with lots of changes in foreign markets, though the refreshed Highland Model 3 is not expected to be available in the US until next year. So Tesla probably feels the need to sweeten the pot a little for buyers who might otherwise wait for the new version to come out.

This is the latest in a long line of Tesla price cuts, starting in January but continuing with several more this year. Most recently, the company took a big chunk off Model S and X prices and also cut the price of FSD by $3K.

In addition to this, most Teslas now qualify for Inflation Reduction Act tax credits, which Tesla previously could not access after it ran out of the previous EV credit, so many buyers can receive another $7,500 credit on their federal income taxes. Although this may not last forever due to the way the tax credit law works, Teslas cheapest models, which use LFP batteries made in China, may lose access to half of the credit next year.

Electreks Take

Teslas now cost tens of thousands of dollars less than they did at the end of 2022. Sure, 2022 was on the tail end of a year or two of significant price increases, while the EV market was highly squeezed due to COVID-19-related supply disruptions, but these drops have still been drastic.

The price drops even resulted in owner protests as recent buyers felt aggrieved at their cars losing thousands of dollars of residual value overnight. Imagine that, protesting in favor of inflation.

The drops have also affected the rest of the EV market, as Teslas dominant position as the market and brand leader in EVs, along with its previously industry-high margins mean that it has more room to prevail in a price war against other manufacturers, while still maintaining a brand perception as being a higher class of electric vehicle.

This has resulted in difficulty for other manufacturers trying to sell similar vehicles. We just saw this earlier today, as VW ID.4 quarterly numbers came out. While the ID.4 saw record sales, VW only sold 10,707 EVs in the US in Q3. Thats less than a tenth of the number of EVs Tesla delivered in the US in the same time frame.

The ID.4 is currently cheaper than the Model Y, at a base price of $37,495 (plus destination), but every Tesla price drop eats away at that difference.

And this, I believe, is the source of the current complaints around the industry about demand problems with EVs. Many manufacturers are lamenting difficulty in growing sales after having no trouble selling every EV they made in 2021 and 2022. But those manufacturers largely have not been dropping their prices this year, whereas Tesla has (well, VW did offer a cheaper ID.4 model this year, just like Tesla has with the RWD).

To extend on the above example, an ID.4 is an incredibly attractive offer at ~$38K against a Model Y at $66K, especially if you can get the tax credit on the ID.4 and not on the Y. But if you shave an effective ~$25K off the price of that Model Y, that calculus is going to change. Maybe thats why the Model Y is now the best-selling car in the world.

Same goes for comparisons to other vehicles, most of which are around the same price they were last year. But if parts shortages are over, if component materials are much cheaper, and if your competition is shellacking you in sales while still managing to lower prices by five digits multiple times over, maybe a little price competition is in order (and the same applies to industries other than automotive, by the way).

And despite my personal dislike of Elon Musks ridiculous shenanigans, at this point, I would be hard-pressed to say there is any better deal in EVs than the Model 3, or even in cars as a whole. Save perhaps for the excellent Chevy Bolt, which is a screaming deal at a base MSRP of $26,500 in its last quarter of production.

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• YouTuber Kim Java's 2018 Tesla Model 3 was cheaper to own and maintain than a Toyota Camry, despite insurance costs being higher for the EV.
• The Model 3 required minimal maintenance, resulting in significantly lower maintenance costs compared to the gas-powered BMW 330i.
• Battery replacement for the Model 3 can be expensive, with a new battery pack costing up to $9,500 for the standard range and $16,000 for the extended range. The advanced technology in EVs can also lead to potential maintenance issues.

Hence, why, Kim decided to bring out the receipts after driving it over 70,000 miles and five years. The results were intriguing, to say the least, as the electric sedan from Tesla turned out to be cheaper to own and maintain than America's best-selling sedan, the Toyota Camry. Being purely anecdotal, the video did omit some more general aspects of EV costs. Therefore, weve decided to expand on Kims calculations, and give you a clearer idea of what to expect when buying an electric vehicle under todays market conditions.

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In order to give you the most up-to-date and accurate information possible, the data used to compile this article was sourced from Tesla and other authoritative sources, including Motor Trend, and Consumer Reports.

The Tesla Model 3: Cheap To Maintain, Expensive To Insure

In order to establish the true cost-to-own of her five-year-old Tesla Model 3 Long Range all-wheel drive, which, by the way, helps us see some reasons for whether the Model 3 can be considered the best compact EV or not, Kim established a list of expenses over that time period that she later added on top of the original price, which was $48,000 after she was granted a $7,500 tax-incentive, even so, if saving money is your priority, you need to run the numbers to see if it's worth paying extra for an EV, since for the most part, they're still not as affordable as their ICE counterparts. She then compared the results to those of the BMW 330i, which is a four-cylinder 2.0 turbo gas-powered vehicle.

Why Electric Vehicle Insurance Costs Are Expensive

As seen in the video above, the most prominent expense for the Model 3 turned out to be insurance, which cost a whopping $6,827 over five years, and exceeded the $5,851 spent on the BMW 330i. This discrepancy can seem confusing at first, since electric vehicles have fewer moving parts, are less susceptible to wear and tear, and require less maintenance than gas-powered vehicles.

Having fewer moving parts would usually mean having fewer reliability issues, and that seems to be the case for some EVs. However, as a study by Consumer Reports shows, that is not always the case. EVs are also more complex in some ways, and composed of pricier parts that can make your insurance company sweat profusely once you show them your repair bills.

Since EVs are often equipped with the latest and fanciest technology, regular shops might not be equipped to fix them when/if they do require attention, since a specialized technician is required. Not only that, automakers are pushing to have it so that customers will be left with no choice but to take their EVs to the dealership in order to get them repaired, since carmakers are trying to not to be required by law to have the information on how to work on their EVs available for independent shops, as they currently have to do with internal combustion engine cars. You might find yourself visiting specialized facilities that will in turn charge more than regular ones. To account for that, insurance companies will charge you more upfront.

Due to its powertrain, the Model 3 also came with a special expense that is often overlooked. Although it's relatively insignificant, you should still be aware of the EV tax, which for Kim Java's 2018 Model 3 up until 2023, has totaled to around $840.

Maintenance Costs, However, Are Usually Lower For An EV

The Model 3 required no particular maintenance, two new sets of tires at around 16,000 miles, and then at 30,000 mile-mark, claims Kim. The maintenance fees for the EV thus only rose up to $2,202 whereas the ICE counterpart required more than triple the amount, resulting in a hefty $7,088.

Since the Model 3 didn't have anywhere near as many moving parts as its gas-powered BMW counterpart, it didn't require the following services:

• Oil changes
• Gasket replacements
• Belt replacements
• Spark plugs
• Cooling system flushes
• Engine Air Filters

Naturally, the Model 3 ended up costing nearly four times less on fuel expenses. While you might end up spending extra hours at the charging-station to alleviate your range anxiety when driving an EV, youll also be compensated for your efforts by spending less of your hard-earned money to keep it running.

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2023 Tesla Model 3 Long Range Performance Specs

Electric Motor	Dual-Motor Setup
Horsepower	435 HP
Torque	363 LB-FT
0-60 MPH	4.2 seconds
Electric Range	333 miles
Charging Time	147 miles in 15 minutes @250 kW

(Specs sourced from Tesla)

The Hidden Costs Of Owning An EV

While EVs are deemed to be fairly reliable on average, it does not mean that theyre always maintenance free or beyond the needs for repairs. Even though Kim had a pretty positive experience with her Model 3, the same does not automatically apply to everyone, and other buyers have reported suspension issues, as well as other technical problems in the past.

According to NHTSA the Tesla Model 3 has 14 recalls, seven investigations and 499 complaints ranging from issues with Tesla's forward collision avoidance system (355 complaints) to the service brakes (112), and vehicle speed control (108). Thus, if youre planning on buying an electric vehicle, there are a few things to keep in mind. The model does have a five start overall safety rating, however.

Battery Packs Can Cost You At Least $13,000 For A Tesla Model 3

The heaviest part of an electric vehicle is the massive battery pack that underpins it. Today most EVs feature lithium-ion batteries, which are made using relatively scarce minerals that fluctuate in prices, and which can only be mined in certain parts of the world. Aside from that, most OEMs take pride in developing their own platforms, and having the fanciest, most technologically advanced battery cells.

Hence, why, replacing them can be quite expensive. In the case of the Model 3, a new battery pack can cost you at least $13,000 for the standard range Model 3 according to JD Power, even though back in 2019 Elon Musk said a battery replacement would be priced at about $5,000 to $7,000. For $13,000 you can find a decent used car, and it just might be reason enough to stay away from a Model 3 altogether.

That Cutting-Edge High-Tech Is A Double-Edged Sword

To make electric vehicles more appealing, companies such as Fisker and Tesla are cramming as many innovative features as they can. You'll notice modern EVs are usually equipped with LiDARs, cameras, sensors, driver assist systems and sophisticated touch screens that offer some of the latest technology. Naturally, these fancy gadgets are prone to malfunction, and can require a fair bit of overtime maintenance.

Luckily, such issues are mostly handled through over-the-air updates, although it's not uncommon for some EV makers to recall some models in order to fix their technical issues. Nonetheless, this can still be problematic over the long run, especially once your warranty is gone.

In a paper published in December 2022, Consumer Reports highlighted the key maintenance issues of EVs. The research team found out that electric vehicles had higher problem rates on average than ICEs in the following areas:

• In-car electronics
• Noise and leaks
• Power equipment
• Climate system
• Paint and trim

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Tesla Is Upping The Ante With The 2024 Model 3 Highland

After seven years of sticking to the same modus operandi, Tesla has finally decided to restyle the Model 3 as it enters its second generation in 2024. The new version, also known as the Highland, has already been praised as the best version of the renowned sedan by those who have done a test-drive on it.

2024 Tesla Model 3 Highland Dimensions

Length	185.8 inches
Height	56.7 inches
Width	76.1 inches
Ground-clearance	5.4 inches

(Dimensions sourced from Tesla)

Tesla Model 3 Highlander Improvements

Sedans are typically associated with a certain image of luxury and comfort, and the upcoming generation perfectly reflects that. The interior experience is now elevated with ambient lighting, befitting the price tag. Aside from the aesthetic improvements, the company also optimized the following features on the Model 3 Highland:

• Ventilated front seats
• 17-speaker sound system
• Eight-inch rear screen
• 20 percent noise, vibration, and harshness (NVH) improvement

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Lower Drag And Higher Range

On the outside, the Model 3 Highland is different from its predecessor in every aspect, besides the doors and rear fenders. Tesla has also addressed the subpar build quality that has long plagued the Model 3 by tightening the panel gaps, which results in a lower drag coefficient of 0.219 that has yet to be paralleled by any other model in the companys roster. This extra efficiency helps with increased range. Tesla claims the 2024 Model 3 will boast 344 miles of range according to WLTP ratings, which is an 11-12 percent improvement.