Used Tesla Values Plunge as Resale Market Cools, Dragging Down Entire EV Segment
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In 2019, Elon Musk predicted Tesla vehicles would rise in value over time due to full self-driving capability, but 4 years later the average used Tesla Model 3 sells for $29,000, much less than original price.
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Used Tesla values have dropped significantly in past 1-2 years as Tesla lost EV market share to competitors and cut prices on new vehicles.
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Lower new Tesla prices pushed down used Tesla values more than average - 2021 Model 3 dropped 29% in past year compared to 19.5% for average 2021 used vehicle.
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Tesla's falling used car values hurt rental car companies like Hertz that rely on strong resale value. Hertz recently sold off much of its Tesla fleet due to poor residual value.
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The plunge in used Tesla prices caused a domino effect, dragging down used EV values from other brands like Ford and negatively impacting the overall used EV market.