There are now signs Tesla’s Model 3 could be as exceptional in the used-car market as it has been in the new-car world. It doesn’t come as much of a surprise to people, but the data is starting to be released.
The sedan has sold at volumes no other battery-powered vehicle has come close to reaching, turning Tesla into the most valuable auto company in the world. But it takes a while to see how well a car performs on the used market — owners typically hold onto their cars for at least a few years.
Car-shopping websites still have small samples sizes to work with for how used Model 3s are doing, and so far, the data is encouraging.
The sedans are selling quickly once owners list them for sale, and TrueCar’s ALG unit sees their presence in the U.S. premium-electric vehicle market having a dramatic impact on the segment.
“If you’re looking for a used Audi A4, you have other comparable options like the BMW 3 Series, Mercedes-Benz C Class and Lexus IS,” said George Augustaitis, director of automotive industry and economic analysis at CarGurus. “If you’re looking for a Model 3, there’s no substitute.”
Early EVs such as the Nissan Leaf and BMW i3 depreciated much faster than conventional cars. Demand was low, driving range was limited and battery degradation was a concern.
Used Model 3s took just 29.3 days to sell on average from March through June, according to iSeeCars.com. The Tesla sedan was the fastest-selling used car the vehicle-listing aggregator tracked during that span.
Tesla’s ability to deliver over-the-air software updates are likely helping its cause.
“You’ll frequently hear people say, ‘The car I own is better than the one I purchased,'” said Gene Munster, a managing partner at venture capital firm Loup Ventures.
Tesla started production of the Model 3 in the second half of 2017, but it took the company months to ramp up output. It also did not begin offering leases until April 2019.
“There still aren’t a lot of Teslas in the aftermarket,” said George Chamoun, CEO of ACV Auctions. Some independent used-car dealers do not sell them, but he expects this to change.
ACV sold triple the number of Teslas in July compared with the beginning of this year, and the average number of bids for the cars are 20 percent more than for the rest of the company’s inventory.
“Demand is outpacing the limited supply,” CarGurus’ Augustaitis said of the Model 3. “Its range and tech and price point are still unique.”