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In 2019, Tesla debuted their Cybertruck model and the highly anticipated (and delayed) models will finally start to be distributed by the end of November 2023. Tesla has racked up more than two million reservations ahead of its official launch.
However, if you want a Cybertruck be advised selling it before the first year of ownership is up may be difficult.
Ahead of the launch, however, Tesla added a section “For Cybertruck Only” to its Motor Vehicle Order Agreement, which laid out the new rules. “You agree that you will not sell or otherwise attempt to sell the Vehicle within the first year following your Vehicle’s delivery date”.
The rules went on to state; “Tesla may seek injunctive relief to prevent the transfer of title of the Vehicle or demand liquidated damages from you in the amount of 50,000 or the value received as consideration for the sale or transfer, whichever is greater”. Tesla may also refuse to sell you any future vehicles.
In other words, if someone were to sell their Cybertruck without Tesla’s permission in the first year that they own a Cybertruck, they can be sued by Tesla and blacklisted from ever purchasing another Tesla vehicle. However, if the customer has a “good reason” to sell their Cybertruck, Tesla may agree to buy it back at the original price minus $0.25/mile driven, reasonable wear and tear, and the cost to repair the Vehicle to Tesla’s Used Vehicle Cosmetic and Mechanical Standards. If Tesla is uninterested in purchasing the vehicle, they may agree to let the customer sell it to someone else.
Although person-to-person resales are easier said than done considering that some of the software is not transferable. For example, the Full Self-Driving feature which costs customers $199 per month, cannot be transferred to prospective buyers.
Another potential hiccup in the selling of Cybertrucks is the price. In 2019, the trucks
were quoted at a starting price of 39,900, making it one of the more affordable EV trucks on the market and on par with the average cost of a new vehicle in today’s market. However, analysts claim that it’s likely to be far more expensive than that, at least during the initial production. In 2021, the previously purported pricing information vanished from the company’s official website. Furthermore, on Tesla’s earnings call earlier this month, Musk had this to say about his Cybertrucks: “It is going to require immense work to reach volume production and be cash-flow
positive at a price people can afford”.
Of course, part of affordability in manufacturing is about scale. The more trucks that can be made in the Texas Gigafactory, the cheaper they become. Musk, however, foresees “enormous challenges” in ramping up production because the Cybertruck requires a new manufacturing process. Musk went on to say “You have to invent not just the car but the way to make the car”.
Musk is optimistic that Tesla could hit a production rate of 250,000 trucks per year by Ed Kim, chief analyst at the auto-industry consulting firm AutoPacific, recently told
Insider he believes the Cybertruck will come with a “fairly premium” price tag, given that it will be made from pricey stainless steel that will likely necessitate more expensive stamping equipment. Moreover, battery prices hadn’t dropped as much as people expected four years ago.
While trucks are the auto market’s most profitable segment, Tesla isn’t exactly a pioneer in the electric truck space. Ford beat out Tesla with the F-150 lightening, a battery-powered F-150 aimed at both pickup fans and commercial customers, starting at $49,995. GM is rolling out its $52,000 electric Chevy Silverado and Stellantis is preparing to sell the $58,000 RAM 1500 REV that promises up to 500 miles of range per charge.
Lastly, Tesla posted weaker-than-anticipated financial results last quarter. Tesla’s 9%
year-over-year revenue growth was its weakest since 2020’s second quarter. Shares of Tesla dropped 9.3% to $220.11 in Nasdaq trading. How Tesla’s Cybertruck will change the financial outlook of Tesla remains to be seen.
