Could The $1,000 Deposit For The Model 3 Be A Wise Investment Decision

Back in March, Tesla unveiled that they were accepting down payment deposits of $1,000 for their latest vehicle, the Model 3. Considering the initial upfront cost of $1,000 and the additional $39,000 the car is worth, it struck me that this vehicle has the potential of creating decent investment returns. Most vehicles tend to depreciate the moment you drive off the lot, and an additional 10% average per year after that. But I believe the Tesla story to be a very different one than most other auto makers. Historically speaking, Tesla vehicles, namely the Model X has appreciated by roughly 40-60% markup on the second hand market, and as well the Model S in times when demand is not met by production. With that said, the potential of the Model 3 being valued at greater than $60,000 is definitely there, which is significantly greater than the initial opportunity cost.

After the first couple of days order numbers were reaching the 300,000s and soon the 400,000s, which is much greater than Tesla’s initial projections. With the astronomical demand and a higher lead time, this increases the potential for markups. With Tesla’s plans of increasing the supercharger network, and the inclusion of its autopilot system, this makes it a much more desirable investment; and the retroactive package purchasing options meant that upfront capital investment is much lesser.

In short, the latest and cheapest model deserves the hype surrounding it, and from a novice investor standpoint, it would be a very wise purchase decision if you plan on flipping it for profit in the second hand market. From an auto fanatic standpoint, if we take a look at the previous iterations from Tesla has given us, one can say that the Model 3 is a safe bet on the roads as well.