Depreciation in the used car market is one way to read demand for a manufacturer’s vehicles. Vehicles that are more in demand depreciate less. To compare the depreciation of the Tesla Model S with competing in class vehicles, we collected data on used cars and constructed an ordinary least squares (OLS) regression model. Here are the takeaways:
- After 50k miles, a Tesla Model S will have depreciated 28% vs the in-class competitor average of 38%.
- A Tesla Model S holds 7% more value than its competitors regardless of variables like model year, miles driven, and initial sale price.
- In a stable economy, the used car market is a proxy for new car sales. This study is a sign that Tesla continues to gain share vs. comparable in-class vehicles.
Of course, if you haven’t a clue about the value of your ride – and don’t care – there are plenty of Buicks available.