Tesla Model 3 Is the Most Popular Used Car in America—and at a Hefty Price

Lightly used Teslas are fetching higher-than-retail prices on the second-hand market.

Visitors look at a Tesla Model 3 during a press preview of the Seoul Motor Show in Goyang, northwest of Seoul, on March 28, 2019. JUNG YEON-JE/AFP via Getty Images

Due to a severe shortage of new Teslas (and any new cars, really) exacerbated by a global chip shortage, the popularity of used Tesla vehicles endures. The electric carmaker’s entry-level sedan, Model 3, has been the fastest-selling car on the second-hand market for four consecutive months, according a new analysis by the automotive research site iSeeCars.com.

In September, a gently used Tesla Model 3 (one to five years old) took an average 16 days to sell, faster than any other vehicle surveyed by iSeeCars. The number of days a Model 3 typically stayed on the market is only half the time it took to sell an average used car, according to the study.

The second fastest-selling used car in September is the Mitsubishi Outlander, which took an average 19.7 days to sell. The Outlander is followed by the Toyota Prius (20.7 days) and Honda Insight (21.2 days.)

Used versions of Tesla’s luxury SUV, Model X, ranked No.9 on the list, taking an average 22.9 days to sell.

“The Tesla Model 3 has remained popular since its highly anticipated debut, thanks to impressive technology and performance at a relatively affordable price compared to Tesla’s earlier vehicles,” said Karl Brauer, iSeeCars’ executive analyst.

While gently driven cars are considered a more affordable alternative to new cars in a normal market, a lightly used Model 3 doesn’t come any cheaper than a brand new one right now. In September, an average used Tesla Model 3 sold for $47,453. A brand new standard range Model 3 starts at $37,690 (after potential tax and gas savings) on Tesla’s website. The long-range and performance versions start at $45,690 and $53,690, respectively.

If you are lucky (and have a generous budget), you may score a used Model X for a small markdown from retail prices. An average Model X sold for a $80,636 in September, according to iSeeCars. A brand new long-range version of the same vehicle starts at $94,690.

Observer recently reported that almost all Tesla models are sold out for the remainder of 2021, which “further adds to the already-high demand for used versions, some of which are being sold at higher prices than new versions,” Brauer said. “Car buyers are willing to pay over MSRP for new cars and highly-elevated used car prices because they have embraced the reality that inventory shortages are here to stay for the next several months.”

The standard range Model 3 currently has a six-month wait time, according to Tesla’s website. The same goes for long-range Model Y and Model S. Long-range Model X isn’t available until May or June 2022.

iSeeCars’ study analyzed more than 900,000 new and used cars sold in September. On the new vehicle side, the fastest-selling model for the month was the Suburu Crosstrek, which stayed on the market for an average 7.8 days. Also in the top ranks were the Chevrolet Corvette (8.6 days), Suburu Forester (9.5 days) and Toyota Sienna (9.6 days).

Tesla cars weren’t included in the new car study because Tesla doesn’t release its monthly sales figures. The company only reports quarterly delivery and sales.

In the third quarter, Tesla delivered 241,300 vehicles globally, a new record, despite the impact of the global chip shortage. Analysts attributed Tesla’s strong Q3 delivery to Tesla’s high gross margin (which should have helped it secure chip supply), its modern manufacturing process and its booming China business.

“The impressive numbers indicate that Tesla is able to overcome the considerable supply chain issues that are impacting the broader auto industry,” the equity analysis firm Trefis said in a report on Monday. “The current chip shortage in the automotive space is largely due to the fact that semiconductor fabs have transitioned production capacity from tried and tested legacy chips used by automakers to more modern chipsets with more advanced process technologies. It’s possible that Tesla’s more modern vehicle architecture is helping it adapt to the current situation more quickly.” Tesla Model 3 Is the Most Popular Used Car in America—and at a Hefty Price