Tesla cancels plans for ‘Model 2’ low-cost EV: report – MarketWatch:

Tesla Inc. TSLA, -1.58% is canceling plans for a lower-cost EV amid heated competition, Reuters reported Friday, citing three people familiar with the plans and company messages it viewed. Tesla shares were down more than 5% in midday trading. The EV maker is fresh off a quarterly sales miss and had long touted an EV for about $25,000 as the next vehicle in its lineup.

I don’t know whether Tesla is canceling the so-called Model 2, a budget EV. But I do know that used Model 3 prices have dropped precipitously, so much so that my 2018 Long-Range All-Wheel Drive Model 3 is now selling on the used market for about $20,000. Even the used Model Ys are around $30,000.  

On one hand, that’s crazy depreciation. My Model 3 listed at $60,000 when I bought it, though the government tax incentives rebated $10,000 of that. Now, 5 years later, it’s lost 66% of its value. Given that my plan is to drive the car until the batteries crap out (currently down in range from 315 miles when new to 275 miles today, so still plenty of juice), I don’t really care about the depreciation. 

On the other hand, for buyers in the used market this is a stellar opportunity to buy a Tesla for cheaper. The Model 3 may not be perfect, but it’s orders of magnitude better than any comparable gas-powered car. I’d say the same about the Model Y, currently among the world’s most popular cars.