In this article, I review pricing and inventory of the Tesla Model 3 in three states and discuss how Tesla is moving away from its national pricing model. Everything in this article is about inventory vehicles. Pricing of cars custom ordered are still consistent nationwide.
Inventory Varies Widely In Quantity & Price In Different States
Let’s look at Model 3 prices in a few places with various state incentives.
Let’s start with Florida, where I live and there are no state incentives. There are over 100 new Model 3 vehicles available, and most have a discount of about $3,000. All the publicity on the Highland refresh might be depressing sales.
Next, I take a look at Illinois, where they have a state incentive of $4,000 in addition to the federal $7,500 tax credit. This brings the net cost of the lowest price Model 3 down to $26,850. Surprisingly, they had 77 Model 3 vehicles available. I think it likely all the people buying a Honda Civic or a Toyota Corolla don’t realize how affordable it is to drive electric.
Finally, I look at Colorado, which has the most generous state incentive program, with a $5,000 tax credit available since the beginning of July. There are only three Model 3 vehicles available in Colorado at the moment and none of them offer a discount off of MSRP. It seems like Tesla should move some of the vehicles in other states to Colorado. I wondered if a Colorado resident could reserve a vehicle in a neighboring state (like Utah) that is offering $3,000 off most of its vehicles. I called a Colorado showroom and got the regional sales center and they were able to answer the question. The answer is yes and no. They used to let you move cars for a transportation fee of $500 to $2,000, but now they only allow that with used cars. So, for a new car, I can buy it out of state, but I have to pick it up in that state and deal with the hassles of sales tax and registration in another state. It might be worth the hassle to save $3,000. This article explains how a dealer can register the car in another state and give you a temporary tag to drive there. It does sound like there may be some issues if the tax rate is higher in the state you buy it from than your home state.
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As Tesla continues to offer more discounts on its inventory vehicles, value oriented buyers like my friend Dennis discover more ways to get these discounts even if they aren’t offered in your region.
Conclusion
It looks like Tesla is learning it needs to get more and more sophisticated with its pricing and inventory as it grows into the mass market. While a traditional manufacturer just sells the cars to its dealers and then those dealers update prices and buy and sell them to other dealers to adapt to imbalances in supply and demand, Tesla has to do all of this itself, since it doesn’t have any independent dealers. This is a blessing and a curse. It is an advantage that they can see the national situation and have more information than a traditional dealer or manufacturer has. But if it isn’t managed well, Tesla can leave a lot of money on the table and not advance its mission as quickly as possible.
If you want to take advantage of my Tesla referral link to get Reward Credits, here’s the code: https://ts.la/paul92237 — but as I have said before, if another owner helped you more, please use their link instead of mine. If you want to learn more about Tesla’s new referral program, Chris Boylan has written an excellent article on it.
Disclosure: I am a shareholder in Tesla [TSLA], BYD [BYDDY], Nio [NIO], XPeng [XPEV], Hertz [HTZ], and several ARK ETFs. But I offer no investment advice of any sort here.
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