
Tesla owners protest over drastic price cuts - throwaway2016a
https://electrek.co/2019/03/04/tesla-owners-protest-price-cuts/
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makerofspoons
The idea of buying a car as an investment that should retain value is totally
alien to me. The thing starts to lose value as soon as you drive it off the
lot. By the time you're done with it the car will be worth a couple hundred to
a few thousand bucks. You agreed to buy at the listed price, and that's on
you.

~~~
berbec
When your back two tires hit the road outside of the dealership, the car is
instantly worth 20% less.

Cars don't appreciate unless they fall under the classics category, and the
time frame involved is decades. Who's going to hang on to a car for 60 years
in case its the next 57 Chevy?

~~~
Someone1234
> When your back two tires hit the road outside of the dealership, the car is
> instantly worth 20% less.

No longer the case. After cash for clunkers, the used market is much more
expensive than it used to be. If you're looking at reliable brands like
Toyota/Honda a two-three year old (ex-lease?) model isn't even 20% off, and
that has 15-20K miles on it.

There's a reason why so many people are buying new, the used market is
strange/irrational for some brands. And new vehicle incentives/lower APR
loans/safety features etc make it a hard call.

People should go check out a no-negotiation dealership (e.g. Carmax). You'll
be surprised at current used prices compared to new.

~~~
ryan_j_naughton
Your information is out of date. Cash for clunkers was a while ago.

I work in the used car industry and across the board (on average) used cars
depreciate at about 1.5% to 2% per month! Some are slightly better and some
are worse, but the vast majority depreciate in that range.

~~~
Someone1234
> Your information is out of date.

I am shopping for cars right now, I'm talking about my current experience with
the cost of recently used vehicles (specifically Toyota, Honda, and other
reliable brands).

> I work in the used car industry and across the board (on average) used cars
> depreciate at about 1.5% to 2% per month!

Where can I buy these two year old vehicles that are 48% off? Or a three year
old vehicle for 72% off? I'm seriously asking, link me to a 2017 Toyota
Highlander Limited for $22K or a 2016 Limited for only $11K...

Locally a 2017 Toyota Highlander Limited is $32K with __65K miles on it __. Or
$36K with under 20K miles, that 's a two year old likely ex-lease vehicle that
has a 15% discount, but a higher APR, worse features, higher maintenance
costs, diminished warranty, and a lower resale value.

The current used market is highly irrational right now. Your imagined used
market where cars are 48% off after only two years sounds fantastic, but that
isn't the reality on the ground.

~~~
ryan_j_naughton
> Where can I buy these two year old vehicles that are 48% off? Or a three
> year old vehicle for 72% off? I'm seriously asking, link me to a 2017 Toyota
> Highlander Limited for $22K or a 2016 Limited for only $11K...

You misunderstand what 2% depreciation means per month.

2 years at 2% would be: 1 - (0.98^24) ends up at 38.4% off, not your 48%.

3 years at 2% would be: 1 - (0.98^36) == 51.6%, not your 72%.

The reason obviously being that 2% off monthly means that the 12th month's 2%
is a lower dollar amount that the first month's 2%. This is also intuitively
true since a vehicle depreciates more steeply at the beginning and less over
time in total dollar terms.

Also I said 1.5 to 2%. At the 1.5% end of the range, a vehicle at 3 years is:
1 - (0.985^36) == 41.9%.

~~~
Someone1234
> 2 years at 2% would be: 1 - (0.98^24) ends up at 38.4% off, not your 48%.

> 3 years at 2% would be: 1 - (0.98^36) == 51.6%, not your 72%.

Can you link me to a 2017 Toyota Highlander Limited for $26K or a 2016 Limited
for $21K? Because I cannot find either one.

New figures, old figures, it still doesn't remotely match reality. Used
vehicles don't exist at the price points you claim they exist at.

Even at 65K miles, we're talking over $31K. You're off by a huge margin.

You said:

> Your information is out of date.

Pretty sure you have that backwards. If you look at the used market it isn't
remotely like what you've claimed twice now.

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tomp
> I’ve been saying it for a while, Tesla’s pricing structure makes them look
> like amateurs.

Nice little passive aggressive completely unargumented quip here...

As a consumer and a free (but fair) market proponent, I _want_ "amateur"
pricing structures.

I don't have a lot of experience buying cars, but I recently needed some FX
conversions. Compare TransferWise and OFX.

TransferWise offers transparent pricing, they do the conversion at mid market
rate and add a bit of fees on top (the bigger the transaction, the lower fees
are in percentage terms).

OFX advertises "no fees" but they offer wider bid/ask spread than the market
does, meaning that they _do_ charge fees, but they're hidden in the price
you're being offered. In addition, they're happy to improve the price if you
call them out on this!

TransferWise are amateurs telling me "we offer a service". OFX are
"professionals" who are communicating "we're trying to exploit amateurs with
an opaque pricing structure that tries to disguise how much our customers are
overpaying".

I know which one I'll be using!

Edit: a simple way to see how much you're actually paying, is to try a two-way
transfer - e.g. first ask the service to give you the price for 1000 GB (say
1,160.29 EUR), then transfer that amount back to GBP (I get 992.78 GBP).
Assuming symmetry, the fee for a one-way transfer then is (1000 -
992.78)/2=3.61 GBP or 0.361%.

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cbm-vic-20
It must suck when your status symbol is now obtainable by the peasantry.

~~~
itg
Did you read the article or are you going by the headline? They are upset
because some of these buyers got their vehicles days before the price cut.

~~~
antris
So what? You buy something if you feel it's worth the price. They bought it
for the price, regardless what the price is after.

~~~
CharlesColeman
>> Did you read the article or are you going by the headline? They are upset
because some of these buyers got their vehicles days before the price cut.

> So what? You buy something if you feel it's worth the price. They bought it
> for the price, regardless what the price is after.

When I was a kid, my parents bought a TV at Best Buy. That model went on sale
the next week, so my parents went back to the store that weekend and were
refunded the difference.

Obviously there are some limits to policies like that, but IMHO, they're the
right way to treat your customers.

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foxyv
What? They didn't believe Musk's claims about price reductions when they
bought them? I mean it's been a long time coming but he built a space program
for heaven's sake.

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ltcoleman
I can empathize with the anger over a price reduction when you just bought a
product. I bought a truck and a month later, the dealership had an additional
5k in rebates. Same happens when you buy an expensive tv, and a couple months
later, the price drops by 1-2k. Technology products are constantly becoming
cheaper through innovation and to satisfy supply/demand economics.. why is a
tesla any different?

If you bought a tesla for resale value, you are doing it wrong. Buying a tesla
helps the environment, furthers innovation, and provides a status symbol.

~~~
benj111
Why?

It isn't as if the $35k model 3 is a surprise.

If you're willing to wait, tech things tend to get cheaper over time, should I
be annoyed that had I waited instead of getting a 486 with 8mb ram, I could
have got something orders of magnitude faster, for an order of magnitude less?

These people for what ever reason didn't want to wait, they paid more, in
return they got some extra months/years of use of a more exclusive machine.

That's the early adopter deal.

Plus as you say, if you bought a tesla for resale value, you are doing it
wrong.

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tlrobinson
> One of those markets is Taiwan, where the price of a Model S P100D was cut
> almost in half by Tesla’s latest price changes – resulting in about $100,000
> in savings.

When people complain about $100 drop in price on a iPhone or whatever I don't
have any sympathy, but 50% on a ~$200,000 car is... significant.

~~~
JumpCrisscross
> _50% on a ~$200,000 car is... significant_

It's a luxury car.

It's not an investment. It's not a necessity. The money that was "lost" was
already spent on hedonistic value. (In any case, Teslas can be returned within
a number of days of purchase. The individual who bought five days before the
price drop is almost certainly within that window.)

~~~
freeopinion
If they bought it 5 days before the announcement, there is nothing to return.
They just have to cancel their order.

Then re-order.

Then wait an extra month to take delivery.

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anilshanbhag
Thread on r/teslamotors about this:
[https://www.reddit.com/r/teslamotors/comments/awvsz7/kelviny...](https://www.reddit.com/r/teslamotors/comments/awvsz7/kelvinyang7_the_price_drop_has_been_dramatic/)

Two good comments there: 1) "huh... i guess outrage over a price drop falls
under the category of "there's no such thing as bad press"" 2) "The news
accounts on weibo posted the news in a negative tone. But the comments are
mainly against who demand refund over price drop. So I would say it's now
viral without much backlash"

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Shivetya
Considering how drastic the changes were overseas and built in demand Tesla
not only garnered poor public response they gave up a lot of free money.

hindsight is 20/20, they should have walked it down to the lowest price points
over the course of the year while broadcasting the fact that they expect to
cut prices continuously.

This ain't to excuse some US customers but I am afraid far too many people
here are merely looking for an excuse to be a victim so that they in turn feel
important. Reddit is all over the place with pro and con comments. The sense
of entitlement. that some people have is astounding.

ps: if you want to see entitlement approach ridiculous levels just check out
the crying in the apple sub that 5gb free cloud is pathetic, shameful, and
outrageous.

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jeffbax
Sucks, but cry me a river. I'm more upset we've been tax subsidizing luxury
car purchases by $7.5k for years. That should have only existed for the bottom
economy models, not status symbols for the wealthy.

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Zoo3y
The issue is not of value depreciation; anyone willing to drop a few thousand
on a new car understands it. New buyers are pissed because they lost the
opportunity cost game. They wanted their new toy NOW, and are crying because
they're out thousands of dollars because they couldn't wait.

~~~
freeopinion
Seems more like they wanted their new toy in 52 weeks, and now they have to
requeue for 53-57 weeks or forego the price drop.

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natch
Many owners are not upset because they understand that with any tech product,
prices drop over time. I would venture to say most owners, but over time the
clue level will be diluted so it’s hard to say.

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antihero
If the car was worth $200k to you when you bought it, great. If it was not,
why did you buy it?

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pbhjpbhj
Do people sell insurance against "buyers remorse"?

~~~
rootusrootus
Many companies do, it's called a price match guarantee. If this causes enough
bad press I wouldn't be shocked if Tesla does it.

~~~
pbhjpbhj
I've seen "price match" from the actual seller, but not third parties?

Eg "find it elsewhere cheaper ...", or "if we put it on sale within 6 weeks
we'll refund the difference"

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captainbland
They bet on Tesla being the Apple of the road and bet wrong by the sounds of
it.

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almost_usual
This isn’t Tesla’s fault. It’s the owners’ fault. When you purchase a Tesla
you are making an extremely risky decision to purchase a vehicle coming from a
brand new car company. The vehicle lifetime, maintenance, price, and service
quality is all an experiment right now.

Call me boring but I’ll be sticking with my Toyota for a bit longer.

~~~
jfoster
Can you explain what you mean about it being "extremely risky?" What's the
worst that could happen, and how likely is that, even?

~~~
rootusrootus
It could turn out to be very unreliable and Tesla could go bankrupt well
before the warranty expires.

