Buying a car usually means negotiating the price, and consumers expect it. But Tesla changed the playbook and removed that step altogether.
The company does not negotiate prices, which begs the question: Do you end up spending more, or would negotiating at a dealer cost less? Also learn several reasons you might regret buying a Tesla.
How Tesla Pricing Works
Buyers do not negotiate the purchase price of a Tesla the way they would with most new cars, according to Edmunds.
The vehicles aren’t sold at dealerships. Instead, buyers purchase them online. Tesla stores do exist, but they function as showrooms where buyers can get help placing an order or take a test drive. When you order a Tesla, the MSRP is the price you’ll pay. However, EV brands like Tesla sometimes reduce (or increase) prices, per Consumer Reports.
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How Dealership Pricing Works
Most new cars are sold through independently-owned dealerships rather than directly by the automaker like Tesla does. Although an MSRP is listed on new vehicles at a dealership, that may not be the final price. Dealers may sell vehicles above or below MSRP depending on supply and demand and negotiations with buyers, per Kelley Blue Book.
According to Edmunds, dealership pricing often changes based on factors outside the buyer’s control. Inventory levels, demand for a specific model and local market conditions can all influence how much flexibility a dealer has on price. Because dealerships operate independently, two buyers shopping for the same vehicle may end up paying very different amounts.
Do You End Up Saving or Spending More When Buying a Tesla?
It could go either way. Tesla’s fixed pricing removes negotiation entirely. Buyers know the price upfront but give up the chance to negotiate a lower deal. At a dealership, the final price can land above or below MSRP, depending on how the negotiation plays out.
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This article originally appeared on GOBankingRates.com: Tesla Doesn’t Let You Haggle — Do You End Up Saving or Spending More Than You Would at a Dealer?
