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Business Insider
23-05-2025
- Automotive
- Business Insider
People are buying up used Teslas as the average sale price dips
There's been a rise in people listing their Teslas this year, and it looks like many of the vehicles are finding buyers as the average resale price dipped slightly last month. Data released on Wednesday from Cox Automotive indicates that the number of used Teslas sold increased by 27% month-over-month in April. The increase brought the automaker's share of the used-car market to an estimated 47%. Chevrolet and Ford followed, with 8.9% and 6% of the used-car market, according to the data. The average sale price for used Teslas in April decreased 1.8% month over month. The overall average listing price for used EVs decreased 2.8%, according to Cox Automotive's data, up from 3.8% from the same period last year. Tesla's growth in the used-car market comes as the EV giant has had a tough start to the year. In addition to its first-quarter vehicle deliveries being 13% lower than the same period last year and its worst since 2022, the company has also been mired in months of boycott efforts resulting from Elon Musk's political involvement. Following harassment and vandalism aimed at Tesla stores and owners of the brand's vehicles, some owners have shared plans to ditch the vehicle, and others have posted TikTok videos of trading in their Teslas for a new EV. Cadillac said this week that it's attracting more Tesla owners, specifically for its Lyriq model. However, Joseph Yoon, Edmunds' consumer insights analyst, told Business Insider that the increase in used-Tesla sales doesn't necessarily reflect politically motivated offloading. With the value of used Teslas falling dramatically over the past year, Yoon said that many likely can't afford to sell their vehicles if their values don't align with its CEO. "Tesla buyers, they don't have that kind of just cash to burn for the sake of feeling better about themselves," Yoon said. Cox Automotive director of industry insights Stephanie Valdez Streaty told BI that Tesla's market share in the used-EV market is correlated with the automaker's dominance in the overall EV market. Up until last year, Tesla held around half of the EV market share, and in 2020, they held close to 80%, Valdez Streaty said. "They've just been at it a long time," Valdez Streaty said. "So, there's a lot more Teslas in the marketplace that become used Teslas." Tesla hasn't launched a mass-market vehicle since 2020 when it released the Model Y, which went on to become one of the top-selling vehicles in the country. The Cybertruck, launched in late 2023, currently starts at $69,990, and a March recall filing revealed that fewer than 50,000 had been sold. As the company faces an increasingly aging car line-up, the used EV market is growing. Valdez Streaty said that Tesla's used cars are, on average, $7,000 less expensive than the average pricing for all used EVs. Its affordability and the options available can make it a good option, she said. While it's still notable that some Tesla owners say they are ditching their vehicles because of politics, it's not clear whether it's happening at scale, Yoon said. For context, Tesla held an estimated 53.3% market share in the used-car market in 2022, 44.5% in 2023, and 44.7% in 2024. There was a bright spot for Tesla in the Cox Automotive data — sales of new vehicles appear to be on the rise. While most auto manufacturers saw a monthly decrease in new vehicle sales, Tesla was one of the few that reported sales growth for new vehicles, with a 3% increase driven by Model Y sales. In April, Tesla sold an estimated 25,231 of its Model Y, which was recently refreshed. GM and Nissan were among the other brands highlighted in the report that saw a growth in new EV sales. The report said that the growth in used EV sales comes at a time when EVs face continued challenges with affordability, availability, and additional uncertainty due to looming tariffs. A recent consumer survey conducted by Cox Automotive indicates that nearly 50% of respondents believe tariffs will significantly impact their decision to buy an EV.
Time of India
15-05-2025
- Automotive
- Time of India
Why losing EV tax credits could hit GM and Ford harder than Tesla in US
Sales of electric vehicles have been rising in recent years, partly because of a $7,500 tax credit from the federal government that helps lower the cost of buying one. But a budget bill that House Republicans released Monday would end that tax credit. Their proposal would also put new restrictions on other tax breaks that have encouraged automakers to invest tens of billions of dollars in new battery plants in the United States. By next year, the bill would do away with the $7,500 tax credit for buyers of new electric vehicles and a $4,000 credit that can be applied to the purchase of used electric cars and trucks. If signed into law, the change is likely to increase electric vehicle sales in the coming months as consumers race to take advantage of the tax credit before it goes away. But sales are likely to slow or fall once the credits end, analysts said. "It's definitely going to impact adoption and slow it down significantly," said Stephanie Valdez Streaty, director of industry insights at Cox Automotive, a research firm. Cox expects electric vehicles to make up 10 per cent of all new vehicle purchases this year. If Congress makes no changes to the tax credits, that number should climb to almost a third by 2030, the firm estimates. But if Congress repeals the credits, Valdez Streaty said, she expects electric vehicle sales to make up 20 per cent to 24 per cent of new car sales by 2030. Losing the credits would deal another financial blow to automakers facing higher costs because of President Donald Trump's 25 per cent tariffs on imported cars and auto parts. The Republican tax proposal would hurt many automakers that have been racing to introduce new models. General Motors and Ford Motor may be hit particularly hard. Both have invested heavily in factories and supply chains with the hope of eventually producing millions of electric vehicles a year. GM has opened two battery plants, in Ohio and in Tennessee. The company built them through a joint venture with LG Energy Solution. Ford has three battery plants under construction - a wholly owned factory in Michigan and two in partnership with a South Korean company, SK On, in Kentucky and in Tennessee. Both Detroit automakers have also invested in mining operations to secure domestic supplies of lithium, a key material for batteries. Tesla, the largest seller of electric vehicles in the United States, will also be hurt. The company's sales have been sliding in recent months because it hasn't introduced new, more affordable models and because of a consumer backlash to its CEO, Elon Musk, who has taken a prominent role in the Trump administration. But Tesla has some advantages. While most automakers are still losing money on electric cars, Tesla has been making money on them for years. As a result, it might have more financial leeway to lower prices to prop up demand if the credits end. The company also relies less on imported parts than other U.S. automakers. Other large automakers have been racing to catch up to Tesla in electric vehicles, including by building many new factories, mostly in states that have elected many Republican lawmakers. Toyota has built a battery plant in North Carolina. Hyundai has started making electric vehicles at a plant in Georgia and plans to produce batteries there. Stellantis and a partner have two battery plants under construction in Indiana. The states hosting these plants have been counting on them to create thousands of well-paying jobs. If the tax rules change significantly, automakers could scrap, scale back or delay their plans. "If the government wants the U.S. to compete with China and the rest of the world in the inevitably large EV market, and wants GM and Ford to make large, long-term investments in EV development and U.S.-based production, it needs to extend the tax credit and wall it off from doctrinaire whiplash," said Erik Gordon, a business professor at the University of Michigan who follows the auto industry. China is the world's largest producer of electric vehicles and is the most important source of critical materials for batteries and electric motors, such as processed lithium and rare earth minerals. The elimination of the tax credits would make it much harder for the U.S. auto industry to catch up. "What this does globally to the U.S. auto industry and its ability to compete -- I think it's going to hurt us," Valdez Streaty said. "I think it's going to slow us down, and we are already behind China." Ford and Stellantis declined to comment, as did the Alliance for Automotive Innovation, a policy group. The federal government began offering the $7,500 credit under President Barack Obama, and it stayed in place during Trump's first term. The credit was renewed and expanded in the Inflation Reduction Act that President Joe Biden signed into law. Because electric vehicles are more expensive than internal combustion vehicles, the credits have been essential in getting more people to buy them. The credit is available on SUVs and pickup trucks that sell for $80,000 or less and sedans that cost no more than $55,000. Cars have to be assembled in North America, and their batteries must meet requirements on which countries their battery materials come from. To qualify, individual buyers have to earn no more than $150,000 a year and couples no more than $300,000. Many of those conditions do not apply to leased vehicles. But the tax credit on those cars and trucks goes to the company that leases the car to individuals, which is typically the finance arms of automakers. Many leasing firms have been passing the savings to their customers, a practice that has led to a sharp rise in leasing of electric vehicles. About 595,000 electric vehicles were leased in 2024, Valdez Streaty said, up from about 96,000 in 2022 before the leasing incentive was available.
Yahoo
03-04-2025
- Automotive
- Yahoo
3 things Tesla needs to do to make a comeback
Tesla's first-quarter delivery report showed the EV giant's business is in trouble. Industry observers told BI what Tesla has to do to stay competitive. They said more models, advanced tech, and advertising could be the answer. Tesla just can't seem to catch a break. The company's stock has fallen amid a backlash against CEO Elon Musk, and its latest delivery report on Wednesday showed its car sales business is fundamentally in trouble. The company's Q1 deliveries dropped 13% from the previous year to just 336,700, well short of analysts' forecasts. Dan Ives, who is typically bullish on the automaker, called the figures "a disaster" that showed the automaker is in a "full-blown crisis." Business Insider spoke to some of the auto industry's keenest observers about what the company needs to do to turn things around. While the political backlash against Musk has grabbed headlines, lead editor for Kelley Blue Book Sean Tucker told BI that Tesla's aging product lineup was a big reason deliveries were falling. He said the carmaker has been grappling with a downward trend in delivery numbers since February 2023. "They grew from 2020 to 2023, and then they started shrinking," Tucker said, citing data from Kelley Blue Book that found Tesla hit a peak of 60,325 monthly US sales in February 2023. The automaker began selling a revamped version of its bestselling Model Y earlier this year but has not launched a new vehicle since the Cybertruck in 2023. While the Cybertruck was the top-selling vehicle in the small EV truck market in 2024, the pickup has failed to boost Tesla's sales numbers. In the first quarter of 2025, the company sold just 12,881 "other models," which includes the Cybertruck, Model S, and Model X. Michael Lenox, business professor and EV industry expert at the University of Virginia's Darden School of Business, told BI that European and Chinese manufacturers now have EV models that are "eating into" the lead Tesla once had. "We've just seen massive entry by all the global existing incumbent auto manufacturers," he added. Stephanie Valdez Streaty, director of industry insights at Cox Automotive, told BI that the number of EVs on the US market had ballooned from around 19 in 2020 to 78. She said that this has made the launch of an affordable EV, which Tesla has said is set to go into production in the first half of 2025, even more crucial to the company. "They need a new model that's affordable because affordability has been a huge issue for consumers," said Valdez Streaty. She said that, with average new vehicle prices in the US now close to $50,000 and tariffs set to raise prices even further, the time is ripe for Tesla to launch a mass-market EV — especially as the company's factories in the US could shield it somewhat from the tariffs. "Tesla has said in the past that they are between two waves of growth, so they need something to propel them to that next growth wave," said Valdez Streaty. While some might consider a sub-$30,000 vehicle Tesla's saving grace, Tucker said that the company hasn't indicated its affordable EV will necessarily be a high-volume product. He said it would likely be a new version of a Model 3 or Model Y with a smaller battery or different battery technology. "That's not really a compelling high-volume product that's going to win them a bunch of sales, at least in the United States," Tucker said. Lenox said Tesla also needed to focus on "pushing the technology forward so they can get more capacity and lower cost out of the battery." Lenox told BI that Tesla's Chinese competitor, BYD, not only has more models on the road but also dominates the battery value chain. BYD reported 416,00 deliveries in the first quarter Tuesday, far more than Tesla. BYD's latest advancement in charging strengthens its position as a leading global EV company, Lenox said. BYD recently announced new chargers that it said could add almost 250 miles of range to an EV in five minutes. The 1,000 kW chargers are four times as powerful as Tesla's current 250 kW chargers, which Tesla has said can add 200 miles of range in 15 minutes. Tesla plans to roll out 500 kW chargers this year, but that's still half the output BYD claims to be able to provide. Tucker added that Tesla has "nothing particularly exciting in the pipeline" on the tech front. Teslas are built on a 400-volt system, and most rivals are now built on an 800-volt system, which allows for faster charging and better performance. While Tesla is due to launch its robotaxi service in Austin this summer, Tucker said that Tesla's rivals have already launched robotaxis — and struggled to make them profitable. "Maybe Tesla has some secret sauce that it can make it work in a way that GM didn't," Tucker said. "But even if it did, I don't know that anyone goes out and buys a Tesla because they enjoyed driving in Tesla's robotaxi," he continued. Tesla has traditionally been reluctant to advertise, preferring to rely on Elon Musk's social media and word of mouth. He said in 2019 that he "hates" advertising, and the automaker only began ramping up its ads spending in 2023 after shareholders asked about it. Tesla's ad-lite approach may have worked when the company was the only EV game in town — but now that competition is on the rise and with the damage to Tesla's brand mounting, Valdez Streaty said the automaker could benefit from a marketing blitz. She said, "There's more competition, and how do you kind of elevate your brand or your models when there's so much out there?" Tesla has benefited from endorsements from Musk's ally, President Donald Trump. Last month, Trump marveled at a fleet of Tesla vehicles at a press event on the White House lawn. Commerce Secretary Howard Lutnick even told people to buy the dip as the company's stock fell. These were in response to protests, vandalism, and attacks against the company over Musk's involvement with the administration and his other political interventions. Analysts have cited politics as part of the reason for the company's stock decline. Sales too, will likely be affected if the anti-Tesla movement continues, Tucker said. "Not a lot of people are going to cross a picket line to buy a car," he added. Read the original article on Business Insider Sign in to access your portfolio
