The arrival of the new Model Y and the controversy dogging the Tesla brand are conspiring to flood the market with legacy Ys, driving prices down.
The new 2026 (its official model year) “Juniper” Model Y went on sale in January as a fully-loaded $60K Launch edition. But when the base All-Wheel Drive model debuted this week at a much more enticing $48,990, the floodgates of latent demand opened up.
There are two opposite forces at work. On the one hand, America’s best-selling EV hasn’t been updated since 2019 and loyal Tesla fans are eager to trade up to the new version. On the other hand, disgruntled Tesla owners are dumping their Ys in the wake of CEO Elon Musk’s controversial actions in the Trump administration.
That’s showing up in the price. CarGurus shows a 2.72% drop in used Model Y price in the last 90 days and 12.69% drop in the last year. And drill down and you’ll find deals on online marketplaces like CarGurus and Autotrader as well as Tesla’s used website.
Record number of trade-ins
Last month Reuters reported that Tesla owners traded in a record number of Teslas based on data from Edmunds, citing “a wave of protests against CEO Elon Musk’s work as an adviser to U.S. President Donald Trump.” Tesla vehicles from “model year 2017 or newer accounted for 1.4% of all the vehicles traded in until March 15, up from 0.4% in March last year,” the report said. This excludes trade-ins toward new purchases of Teslas.
Don’t forget: below $25,000 and you may get a $4,000 federal tax credit
And there are plenty of used Model Ys that fall below the $25,000 price point. If a used Tesla (or any EV) has a sale price of $25,000 or less and is a model year at least 2 years earlier than the calendar year when you buy the car, it may qualify for a tax credit up to $4,000, according to the IRS.