Model Y is now cheaper than a 2023 Premium AWD ER

[Vulnox]

Many people make more than $150k/yr.

Especially those buying $70k new vehicles.

Plus “Many” May turn into “Everyone” when it comes to the full credit next year. It may turn out no one gets the full $7500 on the Mach E when they finally tell us the rules around March 2023.

https://www.consumerreports.org/car...at-qualify-for-new-ev-tax-credit-a9310530660/

Either way, you math question on the $15k difference should be answered.

I have to imagine it's tax credit + price increase. Our MME was ordered November 2021, they did a price increase in December that year of $2k. Then there is the new price increase that raises our car's cost from $59k (after that December Price Increase) to $67k, an increase of $8k.

$8k + $7500 = $15,500. Or $17,500 really if taken from the time we first ordered our car when it was MSRP $57k.

Now, I know they extended the rules and all that, but the key thing is unless the long term rules are changed, come March or whenever, the above amount will be essentially the new price. The MME may qualify for half the credit since it is built in "North America", but even taking that off, for us and the $17k increase we see with no tax credit, it's still a ~$13.5k increase.

I love this car, it's outstanding. I take it instead of my F-150 a lot of times, and I love my F-150. But the price we paid was about the ceiling for what I would pay for a vehicle with this equipment. My F-150 Lariat PowerBoost 502a, every option available, was $72k MSRP and it has cooled seats, way more room, is still at least a Hybrid, has a good 700+ miles of "range", and can tow a boat while also hauling all kinds of suitcases and cargo in the bed way over the limit of the MME. It's also fairly quick too, not MME 0-60 level, but not as far off as one might think given the size difference.

Our MME at $55k with A-Plan is right where it should have been before tax credit. At $67k and no tax credit, we wouldn't have touched it. Maybe if gas was sticking to $6/gallon or something.

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[awp0]

I have to imagine it's tax credit + price increase. Our MME was ordered November 2021, they did a price increase in December that year of $2k. Then there is the new price increase that raises our car's cost from $59k (after that December Price Increase) to $67k, an increase of $8k.

$8k + $7500 = $15,500. Or $17,500 really if taken from the time we first ordered our car when it was MSRP $57k.

Now, I know they extended the rules and all that, but the key thing is unless the long term rules are changed, come March or whenever, the above amount will be essentially the new price. The MME may qualify for half the credit since it is built in "North America", but even taking that off, for us and the $17k increase we see with no tax credit, it's still a ~$13.5k increase.

I love this car, it's outstanding. I take it instead of my F-150 a lot of times, and I love my F-150. But the price we paid was about the ceiling for what I would pay for a vehicle with this equipment. My F-150 Lariat PowerBoost 502a, every option available, was $72k MSRP and it has cooled seats, way more room, is still at least a Hybrid, has a good 700+ miles of "range", and can tow a boat while also hauling all kinds of suitcases and cargo in the bed way over the limit of the MME. It's also fairly quick too, not MME 0-60 level, but not as far off as one might think given the size difference.

Our MME at $55k with A-Plan is right where it should have been before tax credit. At $67k and no tax credit, we wouldn't have touched it. Maybe if gas was sticking to $6/gallon or something.

Correct. This is the math I was using when I said I wouldn't buy my MME at $15k more than I did. Tax credit plus price increase. I just configured my car on Ford's site, and it results in an MSRP of $67k. Pretty sure my 2022 Prem AWD ER MSRP was around $59k (and I bought it at MSRP), so without being exact the MSRP price difference is somewhere in the 8k'ish range. In my post where I shared my opinion, I was careful to include "sizable portion of the target demographic that no longer qualify for the tax credit", which is the remaining $7,500 that gets you to $15k.

About the tax credit income limit: I don't have any data to know what percentage of MME purchasers are over the income limit. But I would suggest it's not uncommon in general, and probably quite common in high cost of living areas (that someone shopping for a $67k car is making over $150k).

FWIW, I do support the income limit. Makes sense to me that high earners don't need help buying a luxury car these days. But that makes the MME a questionable value proposition IMHO.

 

[Jeffvisor]

From Business Insider..
Elon Musk may have a bigger problem than Twitter as Tesla slashes prices to offload inventory and investors get nervous

• Tesla price cuts are "not a good sign," Wedbush analyst Dan Ives said.
• The automaker is advertising a $7,500 credit on Model 3 and Model Y vehicles.
• Price cuts come as Tesla's stock is in freefall and inventory piles up.

Tesla's doubling of discounts this month on its most popular vehicles is the latest sign of trouble for the electric-vehicle maker.

While the rest of the automotive industry holds back on discounts for the third holiday season in a row, Tesla is lathering on the deals. Industry analysts say that's a sign Tesla is battling an inventory backup as demand for its all-electric vehicles cools.

"The price cuts are not a good sign for the holiday season," Dan Ives, an analyst for Wedbush Securities, wrote in an email.

Tesla's website advertised on Thursday a $7,500 credit for all Model 3 and Model Y vehicles delivered before the end of the year, a doubling of the $3,750 credit offered on the same vehicles earlier this month. The discounts are a rare move for Tesla, which had instituted a series of price hikes in the last few years, citing supply chain disruptions and inflation.

Tesla long resisted traditional auto industry discounts as its ramped up production and customers clamored for its vehicles. Musk's EV maker has also enjoyed an early-mover advantage in the last several years as one of the only sellers of all-electric vehicles in the US.


More competitors entered the market in 2022, from fellow startups like Rivian and Tesla and from legacy car manufacturers like Ford, GM and Hyundai. And without the $7,500 federal tax credit, which expired for Tesla in late 2019, many first-time EV buyers are considering other brands over Tesla.

Tesla's vehicles could qualify for tax credits again under new rules spelled out in the massive climate bill passed this summer, but the US Treasury Department this week pushed back enforcement of these new requirements until March. That means would-be Tesla buyers who were holding off until January may not be waiting for spring.

Analysts also worry that Musk's series of gaffes as Twitter owner and CEO are damaging the Tesla brand. Some reservation-holders have tweeted their cancellations in the last several weeks.

This all comes on top of a plummeting stock price, with some disgruntled Tesla investors worrying the EV company is essentially operating without a CEO while Musk focuses on Twitter.

"Very negative spiral happening on the Tesla story," Ives wrote in his email.

 

[dmastro]

From Business Insider..
Elon Musk may have a bigger problem than Twitter as Tesla slashes prices to offload inventory and investors get nervous

• Tesla price cuts are "not a good sign," Wedbush analyst Dan Ives said.
• The automaker is advertising a $7,500 credit on Model 3 and Model Y vehicles.
• Price cuts come as Tesla's stock is in freefall and inventory piles up.

Tesla's doubling of discounts this month on its most popular vehicles is the latest sign of trouble for the electric-vehicle maker.

While the rest of the automotive industry holds back on discounts for the third holiday season in a row, Tesla is lathering on the deals. Industry analysts say that's a sign Tesla is battling an inventory backup as demand for its all-electric vehicles cools.

"The price cuts are not a good sign for the holiday season," Dan Ives, an analyst for Wedbush Securities, wrote in an email.

Tesla's website advertised on Thursday a $7,500 credit for all Model 3 and Model Y vehicles delivered before the end of the year, a doubling of the $3,750 credit offered on the same vehicles earlier this month. The discounts are a rare move for Tesla, which had instituted a series of price hikes in the last few years, citing supply chain disruptions and inflation.

Tesla long resisted traditional auto industry discounts as its ramped up production and customers clamored for its vehicles. Musk's EV maker has also enjoyed an early-mover advantage in the last several years as one of the only sellers of all-electric vehicles in the US.


More competitors entered the market in 2022, from fellow startups like Rivian and Tesla and from legacy car manufacturers like Ford, GM and Hyundai. And without the $7,500 federal tax credit, which expired for Tesla in late 2019, many first-time EV buyers are considering other brands over Tesla.

Tesla's vehicles could qualify for tax credits again under new rules spelled out in the massive climate bill passed this summer, but the US Treasury Department this week pushed back enforcement of these new requirements until March. That means would-be Tesla buyers who were holding off until January may not be waiting for spring.

Analysts also worry that Musk's series of gaffes as Twitter owner and CEO are damaging the Tesla brand. Some reservation-holders have tweeted their cancellations in the last several weeks.

This all comes on top of a plummeting stock price, with some disgruntled Tesla investors worrying the EV company is essentially operating without a CEO while Musk focuses on Twitter.

"Very negative spiral happening on the Tesla story," Ives wrote in his email.

I wonder if they are one of the Tesla shorts. Tesla has a long history of pulling triggers to move inventory at end of quarter. To me this doesn’t seem any different than they’ve done in the past, giving pricing incentives to combat tax incentives.

They’re finishing off their most successful year, with the highest deliveries and profits ever. The Twitter debacle has undoubtedly, had a small impact, but I don’t see demand cooling significantly.

 

[dbsb3233]

Will Ford run the same promotion on Mach E hopefully back date to first of December?

No

 

[Monke]

I have both model Y performance and MME 4x ER premium. They got very similar range in summer. In winter Tesla is way better.

Model Y long range should be even better.

Thank you for the insight.

 

[dbsb3233]

From Business Insider..
Elon Musk may have a bigger problem than Twitter as Tesla slashes prices to offload inventory and investors get nervous

• Tesla price cuts are "not a good sign," Wedbush analyst Dan Ives said.
• The automaker is advertising a $7,500 credit on Model 3 and Model Y vehicles.
• Price cuts come as Tesla's stock is in freefall and inventory piles up.

Tesla's doubling of discounts this month on its most popular vehicles is the latest sign of trouble for the electric-vehicle maker.

While the rest of the automotive industry holds back on discounts for the third holiday season in a row, Tesla is lathering on the deals. Industry analysts say that's a sign Tesla is battling an inventory backup as demand for its all-electric vehicles cools.

"The price cuts are not a good sign for the holiday season," Dan Ives, an analyst for Wedbush Securities, wrote in an email.

Tesla's website advertised on Thursday a $7,500 credit for all Model 3 and Model Y vehicles delivered before the end of the year, a doubling of the $3,750 credit offered on the same vehicles earlier this month. The discounts are a rare move for Tesla, which had instituted a series of price hikes in the last few years, citing supply chain disruptions and inflation.

Tesla long resisted traditional auto industry discounts as its ramped up production and customers clamored for its vehicles. Musk's EV maker has also enjoyed an early-mover advantage in the last several years as one of the only sellers of all-electric vehicles in the US.


More competitors entered the market in 2022, from fellow startups like Rivian and Tesla and from legacy car manufacturers like Ford, GM and Hyundai. And without the $7,500 federal tax credit, which expired for Tesla in late 2019, many first-time EV buyers are considering other brands over Tesla.

Tesla's vehicles could qualify for tax credits again under new rules spelled out in the massive climate bill passed this summer, but the US Treasury Department this week pushed back enforcement of these new requirements until March. That means would-be Tesla buyers who were holding off until January may not be waiting for spring.

Analysts also worry that Musk's series of gaffes as Twitter owner and CEO are damaging the Tesla brand. Some reservation-holders have tweeted their cancellations in the last several weeks.

This all comes on top of a plummeting stock price, with some disgruntled Tesla investors worrying the EV company is essentially operating without a CEO while Musk focuses on Twitter.

"Very negative spiral happening on the Tesla story," Ives wrote in his email.

TSLA has been wildly overvalued for 3 years. Their Model Y prices soared over the last year+, mostly because the market for EVs exploded with way more demand than supply. When there's that much imbalance and consumers are willing to spend an extra $10k-20k to get one (see: Mach-E and Lightning ADM), the manufacturer is gonna raise MSRPs. Don't want to leave money on the table. That's also why Mach-E and Lightning MSRP's have gone way up too. Ford got tired of dealerships cashing all that extra money, now they want it.

But the whole auto market is sliding now in the face of high loan interest rates and a fading economy. As well as sky-high gas prices coming back down. $TSLA is not the only auto stock falling. They're off 68% YTD (from a wildly inflated high), $F is off 48%, $GM off 45%. It's the whole auto market.

 

[Monke]

Much better lately (from last year or so).

Also, Tesla OTA is real. Frequent updates (like twice a month) fixing issues and update features.
Tesla mobile service is great also. If your car has an error, it shows you detailed info, the error is sent to Tesla when you request service, and if possible, they come to your car to fix it.

Good luck dealing with a Ford dealer with any problem.

As far as I know mobile service can only fix simple things like glue back emblems. However service centers of Tesla are top notch. When we took a Model S for a tiny ding on a lower bumper (quality control issue not damage), Tesla changed out the whole bumper. Just like that Tesla wants customer to be happy. In a way, it might be cheaper to change out a bumper since I did not see a body shop facility. The experience are slightly different from center to center as expected. The draw back is that the closest center is two hours away. Tesla gives UBER credit and that is very nice of them.

My hometown Ford dealer is also top notch with nicer waiting facility.

 

[Mach1E]

From Business Insider..
Elon Musk may have a bigger problem than Twitter as Tesla slashes prices to offload inventory and investors get nervous

• Tesla price cuts are "not a good sign," Wedbush analyst Dan Ives said.
• The automaker is advertising a $7,500 credit on Model 3 and Model Y vehicles.
• Price cuts come as Tesla's stock is in freefall and inventory piles up.

Tesla's doubling of discounts this month on its most popular vehicles is the latest sign of trouble for the electric-vehicle maker.

While the rest of the automotive industry holds back on discounts for the third holiday season in a row, Tesla is lathering on the deals. Industry analysts say that's a sign Tesla is battling an inventory backup as demand for its all-electric vehicles cools.

"The price cuts are not a good sign for the holiday season," Dan Ives, an analyst for Wedbush Securities, wrote in an email.

Tesla's website advertised on Thursday a $7,500 credit for all Model 3 and Model Y vehicles delivered before the end of the year, a doubling of the $3,750 credit offered on the same vehicles earlier this month. The discounts are a rare move for Tesla, which had instituted a series of price hikes in the last few years, citing supply chain disruptions and inflation.

Tesla long resisted traditional auto industry discounts as its ramped up production and customers clamored for its vehicles. Musk's EV maker has also enjoyed an early-mover advantage in the last several years as one of the only sellers of all-electric vehicles in the US.


More competitors entered the market in 2022, from fellow startups like Rivian and Tesla and from legacy car manufacturers like Ford, GM and Hyundai. And without the $7,500 federal tax credit, which expired for Tesla in late 2019, many first-time EV buyers are considering other brands over Tesla.

Tesla's vehicles could qualify for tax credits again under new rules spelled out in the massive climate bill passed this summer, but the US Treasury Department this week pushed back enforcement of these new requirements until March. That means would-be Tesla buyers who were holding off until January may not be waiting for spring.

Analysts also worry that Musk's series of gaffes as Twitter owner and CEO are damaging the Tesla brand. Some reservation-holders have tweeted their cancellations in the last several weeks.

This all comes on top of a plummeting stock price, with some disgruntled Tesla investors worrying the EV company is essentially operating without a CEO while Musk focuses on Twitter.

"Very negative spiral happening on the Tesla story," Ives wrote in his email.

I think this was inevitable.

Musk thought that cars could be like the iPhone…… where everyone could own the same one and he could grow market share forever.

Has Tesla even planned to change the look of their cars? The 2023 Model S looks just like…….. the 2013 Model S.

With literally everyone joining the competition, they will just lose market share the more time goes on.

 

[4sallypat]

Many people make more than $150k/yr.

Especially those buying $70k new vehicles.

Plus “Many” May turn into “Everyone” when it comes to the full credit next year. It may turn out no one gets the full $7500 on the Mach E when they finally tell us the rules around March 2023.

https://www.consumerreports.org/car...at-qualify-for-new-ev-tax-credit-a9310530660/

Either way, you math question on the $15k difference should be answered.

Well, from a lowly, poor, state employee, under $150K person, I can afford both my current $76K '22 Lightning Lariat and $56K '23 MME Premium.

Lightning will get me a $7500 tax credit for 2022 plus $3750 state/utility rebates which drops the cost to around $65K.

My incoming MME will be here next month and it gets a $6000 PCO + $7500 tax credit + $2000 state rebate = $40K net.

 

[Vulnox]

As far as I know mobile service can only fix simple things like glue back emblems. However service centers of Tesla are top notch. When we took a Model S for a tiny ding on a lower bumper (quality control issue not damage), Tesla changed out the whole bumper. Just like that Tesla wants customer to be happy. In a way, it might be cheaper to change out a bumper since I did not see a body shop facility. The experience are slightly different from center to center as expected. The draw back is that the closest center is two hours away. Tesla gives UBER credit and that is very nice of them.

My hometown Ford dealer is also top notch with nicer waiting facility.

On the flip side of that, a couple years ago my parents 80 year old neighbor with a Model X needed service and this was when Tesla still came and got your car, but only kind of, as he would find out. They were in Michigan and they came and brought his MX to the service center in Ohio and when it was done told him to come get it as the return drop off was no longer offered, and they didn't mention that when they came and took it. 80 year old dude going an hour and a half to go get his own car and he lives alone. He also happens to be a lawyer though and was very convincing and they eventually brought it back.

He had an issue with it recently where it wouldn't turn on/unlock/etc, may have been 12V (which isn't unique to Tesla or anything), and Tesla basically told him to pay to have it towed again to Ohio, and he would either have to come get it or have it flat bed towed back. Not a small expense.

Tesla has a service center in Michigan, but it's about center of the state so it's actually 5-10 minutes longer to go to it. The key thing being their service isn't all golden and depending where you live can really screw you. If my MME has an issue I have six Ford dealers within 20 minutes, and Ford has mobile service and pick up and delivery and free roadside (during warranty period) and all that jazz.

I have also had exceptional service from our Ford dealer, although that certainly isn't the rule. That neighbors experience shows that Tesla service being great isn't the rule either.

 

[Vulnox]

I think this was inevitable.

Musk thought that cars could be like the iPhone…… where everyone could own the same one and he could grow market share forever.

Has Tesla even planned to change the look of their cars? The 2023 Model S looks just like…….. the 2013 Model S.

With literally everyone joining the competition, they will just lose market share the more time goes on.

Exactly, and I know my posts seem to be anti-Tesla, but I am not anti-Tesla by any stretch (I am anti-Musk though and wish he would detach from the company). I only come off as negative because a few on here seem to paint Tesla as do-no-wrong, when that simply isn't the case. They do a lot of things right, and some things still better than the traditional automakers, no doubt. We intended to buy a MY about a year ago until we test drove it and found it just wasn't for us.

But they do A LOT wrong, and those blemishes are harder to overlook as the traditional automakers make up ground. Their sales are still great, for sure, but as others have said I wouldn't count on past performance to be an indicator of future. I don't think Tesla is going out of business, but much like GM eventually overtook Ford in the early days of mass market vehicles, Tesla is going to see their market share slim down at an exponential rate unless they actually do something really innovative soon. They are coasting on brand name more than exceptional products, and history has shown over and over that brand names only take you so far.

 

[dbsb3233]

I think this was inevitable.

Musk thought that cars could be like the iPhone…… where everyone could own the same one and he could grow market share forever.

Has Tesla even planned to change the look of their cars? The 2023 Model S looks just like…….. the 2013 Model S.

With literally everyone joining the competition, they will just lose market share the more time goes on.

The Model Y went from $57,000 to $77,000 in 18 months. Even counting rising inflation, that's still mostly market adjustment (since buyers were paying it). Meaning, they were still making money at $57k, and will again after the price falls back down to normal levels. They just won't be making the WILD profit margins that the market allowed them to make the last 2 years. And now that they're getting a $7500 tax credit again, they probably won't have to drop prices a ton. Although they will surely be coming down some.

I agree about the boring look though, and Tesla risking saturating the market for it. Consumers like variety. Tesla is betting that consumers will be happy with a bazillion of the same model, which is their business model. I think they'll find demand topping out for it, at least in the US.

 

[RedOctobrrr]

I'd say "many" is a stretch but I don't know @awp0's particular situation.

They did a poll on Reddit and an overwhelming majority of users interested in, already purchased, or have an MME on order were >$150k.

 

[Ride_the_lightning]

I hope it isn’t a stretch. I can’t imagine paying $70k for a vehicle with an income under $150k. When I made under $150k I bought a used Acura for $29k. And I live in a low cost of living state. But everyone’s priorities are different I suppose.

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