Used Car Market Sees Shift with Tesla Price Drops
The used car market is experiencing a surge in popularity, driven in part by high new car prices. Consumer Reports has recently released its inaugural brand ranking of used cars, revealing significant price drops for Tesla models, particularly the Model Y and Model 3.
“With the historically high price of new autos these days, more and more people are naturally looking to the pre-owned market in search of a better bargain,” stated Alex Knizek, associate director of auto test development at Consumer Reports.
Model Y Price Collapse
The Tesla Model Y, a popular electric vehicle in the U.S., has seen a substantial price decrease. Data indicates that the average price for a used Model Y has fallen over $6,000 in the last 12 months, reaching approximately $30,000 this month. Compared to March 2023, the price has dropped more than $20,000.
The availability of low-mileage Model Ys at attractive prices is evident in the used car market. For example, listings on CarGurus showcase many vehicles priced below $30,000.
Sub-$15,000 Model 3 Offers
Used Model 3s, even those with higher mileage, are now accessible for under $15,000. This presents an affordable entry point for potential first-time electric vehicle buyers. For instance, a 2020 Model 3 with over 170,000 miles is listed on CarGurus for $11,999, while a 2020 Model 3 Standard Range Plus RWD, with approximately 58,000 miles, is available for $19,999.
Increased Competition and Shifting Consumer Preferences
The introduction of the new Model Y “Juniper” may prompt a sell-off of the previous generation. Moreover, the electric vehicle market is experiencing increased competition, placing pressure on Tesla.
Davide Greene, an industry analyst at Cars.com, noted in an email, “Despite Tesla’s continued reputation for competitive pricing and strong lease deals—specially for the Model 3 and Model Y—the brand is facing mounting pressure in an increasingly competitive EV landscape.” He pointed out that the number of used EV models has risen significantly, with 76 different models available as of February 2025, compared to 58 the previous year.
Kevin Roberts, Director of Economic and Market Intelligence at CarGurus, observed that “Teslas have…become somewhat of a bargain in the used market, with the average list price of a used Model 3 at $23.8k and a used Model Y down to $30.6k, both well below the used EV average of $36.1k in February.”
Shifting Trends in Search Activity
Web searches show a decrease in interest for used Teslas. In February 2025, searches for used Teslas dropped 7% year over year, whereas searches for other used EVs increased by 28%. Greene mentioned that used Teslas are remaining on dealer lots at a similar rate to other EVs, which reflects a change from the previous year when Tesla models sold more quickly than competitors. He concluded, “The combination of more competition and shifting consumer preferences makes it clear that Tesla’s dominance is being tested.”
