I’m in the fortunate position that we wouldn’t qualify (just!) for the $7,500 rebate based on the AGI threshold.
Still, buying a new Tesla and paying $7,500 more than the majority of folks is a difficult pill to swallow. Have any Tesla price-watchers noticed it flow into used Model Y prices? It’s not a bad problem to have but it is leading me down some interesting thought patterns. I could:
Count my blessings and just stump up the full MSRP
Wait for it to factor into used Tesla prices. I haven’t been following them so I don’t know if this has occurred and whether it’s smarter to buy used from Tesla directly or a non-Tesla dealer.
Buy a different brand that isn’t subsidized
I’m in CT so I think there’s a small subsidy for hybrid/electric vehicles.
Any advice, thoughts and forecasts appreciated. Ironically we were far below the threshold when there wasn’t a threshold years ago and now we’re just above it. Thank you.
I’m in the same boat. I’ve had Tesla envy for years. I tried to put my wife in Model Y about 2.5 years ago, but she hated it. I would have gotten it myself but had just signed a lease on a Kona EV. I was planning on buying a Model Y when my lease ended. But I could not bring myself to paying $7500 or even more with state rebates than others. I ended up with an Ioniq 5 SEL AWD. Some say it’s nicer than the Model Y. It’s still not a Tesla. It is really nice, just not as techie. It’s much nicer than the Kona EV. SoCal is currently saturated with Model 3 and Model Ys. Everyone seems to have one, so it’s nice to drive something a little different.
I believe it’s based on MAGI and you only need to be under $300k in 2022 or 2023. If you’re close, you might be able to put more into 401k or HSA (if you’re not already maxing out) to lower MAGI
We cross-shopped the Tesla Model Y and the Hyundai Ioniq 5 among others. My wife liked the Tesla but I clearly prefer the Ioniq (I drive a Model 3 daily fyi). The big difference is that Hyundai will pass through the $7500 lease credit (with no income cap) on a lease deal. If you’re intent on owning savvy dealers will structure a lease that you can buy out immediately, effectively skirting the income cap and giving you access to at least the federal credit. I had a coworker do this and it made the Ioniq 5 a much more attractive deal, especially with the deals off MSRP currently available.
I chose to lease instead (2 years 12k miles) precisely for the reason you mention: used prices for all of these vehicles will come down, it’s just taking time. Model Ys have been loosing $500 per week for the last year…! Tesla Model Y Price Trends - CarGurus
And they haven’t stopped falling… My conclusion was the lease an Ioniq 5 for two years (see the ~11k one pay lease just signed elsewhere on the site for the types of deals available), let depreciation take its course and then potentially buy used in 2 years if the Model Y still seems attractive.
Yes, used is the way to go now… or why not lease one!?!
Tesla has some used Long Range on their website for low to mid $40’s 2020/2021 and some include the Enhanced Autopilot. I think prices should stabilize by the end of this year on used Teslas.
When I purchased mine in June 2022 I could’ve flipped it for about $5K profit after taxes-but decided to keep it as that’s what I was looking for to replace the Tesla 3… if I sell now it’s an easy $30K less haha
This is the reason I ended up with an ID4 over the MY. I also liked the way the ID4 looked vs the MY. Would I have tried the MY out more if Tesla passed the $7500 on a lease? Probably… I bought out my ID4 right away with12k total off sticker so it was a pretty good deal BUT it’s not a Tesla with the supercharger network
Yep-we all know this. OP was considering a Tesla, that’s why replied for Tesla… of course there are much better lease deals on EV right now, heck if I didn’t have this Tesla I would’ve gotten an ioniq 5 SEL myself for the price
Thanks Peter. Yes, I would definitely consider an alternative and this is opening my eyes. Congrats on the Ioniq 5 - great looking car!
I’m curious though, when you say that dealers will pass on the $7,500 credit directly through the lease. I didn’t think the Ioniq 5 qualified for any Federal EV credit so is this really just a discount that the manufacturer is throwing in to stay competitive? Or is there some other credit that they are financially engineering? I’ve seen this in other deals and was curious.
Thank you everyone. Actually, I’m totally open to non-Tesla options, I just assumed (wrongly) that because they qualify for the EV credit, Tesla’s would be the most value for money. For example, Mach-E’s still seem to be priced in the stratosphere even though they offer similar performance to a Model-3.
Would love to hear your opinions on what is better bang for your buck right now and which deals are hot (Lease or Purchase). Thank you.
Unless Tesla decides to pass on the credit (and allow purchasing, which I am not super bullish on), I begrudgingly think is the best plan for me is to wait until the lower priced Teslas (i.e. ones purchased in 2023) start hitting the used market in force next year.
This income limit is a real factor for us due to HCOL in California. With a 7mo old baby, we are definitely not feeling super flush, and that $7,500 delta has us holding back on the purchase.
As outlined above, the government is currently giving Hyundai and other foreign manufactures a “pass” on the domestic manufacturing requirements under the I.R.A. if the cars are leased rather than sold. This is limited time only, so Hyundai and others are busy transferring manufacture of their electrics to the US, but for now the government will give EV makers $7500 for every EV they lease and some manufactures like Hyundai (but not Kia) are choosing to pass that on directly to the consumer. A deal might look like $4k off MSRP (because there’s well over 100 days supply of Ioniq 5s now) plus $7500 federal tax credit plus $2500 brand loyalty (if you own a Hyundai now) or in my case $500 military discount plus low financing rates or potentially other local credits if you qualify. In all $12k plus off MSRP is very achievable when all of these stack, making shorter term leases very attractive or making buying out the lease immediately (with the right company) a way to access a much better deal than one can otherwise for those of us over the income limit.
I’d highly recommend you test drive an Ioniq 5 SEL if this sounds interesting- as I said I prefer the way it drives to the Y and it’s likely going to be a much better deal, as in potentially half the payment to lease.
I’ve driven both the Ioniq 5 and the Model Y and these are completely different vehicles. The Model Y has alot more interior space. a much more usable second row, feels significantly quicker and has superior assisted driving technology. The Ioniq is essentially an extremely quirky hatchback. IMO, the Ioniq experience is closer to a Model 3, and in that comparison, it is more expensive.
