With over 350,000 paid pre-orders worldwide, Tesla Motors Inc (NASDAQ:TSLA) is already set to rake in a large portion of the EV mid-market with its Model 3. The electric vehicle maker is already recognized as the world’s best EV manufacturer. Its Model S alone has won numerous awards since its launch in 2012, and also managed to score the highest rating ever given by Consumer Reports. Now the automaker is about to make its luxury brand a whole lot more affordable. The upcoming Model 3 presents itself as every EV fan’s chance to own a luxurious Tesla at a discount.
There is only one problem though — the purchase of any new Tesla car is always a lengthy process. I’m not talking about a few weeks either, but several months. In fact, the firm’s Model X SUV has a year-long waiting list. That’s only few months better than the hopefully on-time arrival of the Model 3 late next year. Those who’ve already made their payments for the car will only find themselves behind the wheel of their Model 3s sometime near the end of 2017 at the earliest. And that’s if everything goes according to plan.
Tesla’s CPO program
However, should you find that a new Model S sedan or Model X SUV is a bit beyond your price range, you don’t have to wait until next year’s Model 3 before you afford the Tesla brand. There is a much less expensive way to make yourself the owner of a high-end EV and, better yet, you don’t have to wait anywhere near as long as you would with a normal Tesla purchase. These vehicles are ready for delivery NOW.
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Early last year, Tesla Motors rolled out its Certified Pre-owned (CPO) program. The program takes its traded-in EV and places them for resale. Thing is, though you would be buying a used Tesla, the EVs on sale are reported to be prepped as good as new. Most CPO vehicles have low miles – typically under 25k miles with many under 10k miles.
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On the downside… CPO vehicles do not qualify for tax rebates but the prices can be so low that you won’t mind as you’ll still be getting a fabulous price. Another challenge when purchasing a CPO Tesla is that not many are equipped with Autopilot hardware. If you want that feature in a CPO you should let your local Tesla store know so they can keep their eyes open for when one comes available. Rarely do these show up on the company’s website.
A look at Tesla’s recent earnings reports shows the company dedicating a significantly high amount of money towards getting its trade-in EVs ready for resale. In fact, analysts report that Tesla Motors is likely selling a majority of its CPO cars at a loss.
CPO Teslas are as good as new
The greatest reason behind this lies in the delicate position of the Tesla brand. Though already famous as the greatest EV automaker around, the automaker continues to fall short of making profits quarter after quarter. Despite this, the company is venturing headstrong into a less profitable market by selling a car that is suspected to cost a lot more to build than the current price it goes for. So, if Tesla can’t pull in positive earnings selling high-end EVs, how would it do so with the Model 3?
Already, the company is working tirelessly at setting up means to make building its EVs a lot cheaper. Perhaps the biggest part of this plan is its Gigafactory. Said to already be operating, the plant would lessen the cost of making lithium-ion batteries and other components. This would allow Tesla to derive more profits from its cars and other energy ventures. Until its completion though, the investment and consumption of the brand will remain in a fragile state.
This is why the EV giant puts a lot of money towards ensuring that every EVs it sells, even the used ones, is in great condition. Tesla can’t afford to sell sub-standard EVs. It also needs to keep the demand of its cars on the rise. Pushing out defective used cars would only hurt the Tesla brand a lot more than a quick car sale could fix.
Get a Model S at a discount
Currently, only the Model S is available on the CPO program. This is understandable when you consider that the Model X was only rolled out last September. Though no CPO car has gone for the alluring $35,000 price tag of the Model 3, used Model Ss have gone for as low as $45,000. That’s a high-end used Tesla EV, made to run as good as new by the company, for the likely price of a Model 3 after extras.
Another great benefit to opting for the CPO program is the time saved. Unlike the several month-long waiting periods associated with a new Tesla purchase, buying a car though the CPO program can have you driving off the(NASDAQ:TSLA) showroom in your Model S with a matter of days.
Purchasing a used EV comes with many of the same benefits of a new Tesla too, proof that there are no sub-standard owners in the eyes of the company.
If the delivery time of a Tesla purchase is what puts you off, if the only reason behind ordering a Model 3 is that you can’t afford a Model S, or if you’re just keen on getting yourself a high-end EV at a fraction of the price, then consider getting a Model S via the CPO program.