3 Ways to Save $7,500+ by Buying a Tesla

Sales of electric vehicles have spiked over the past few years. New model releases and the expansion of charging networks are helping to entice first-time EV buyers.

Teslas are still among the some of most in-demand electric vehicles (EVs). However, EV prices have gone up significantly over the past few years, so how can you save money on a purchase? Here are three ways to trim $7,500 off your Tesla purchase.

1. Get the full tax credit

The IRS's EV tax credit is the easiest way to save $7,500 on your Tesla purchase. The credit can be applied instantly to the price of eligible Teslas (more on that below), saving you up to $7,500 off the purchase price.

To be eligible for the tax credit, your modified adjusted gross income (AGI) can't exceed $300,000 for married couples, $225,000 for heads of household, or $150,000 for all other tax filers.

There are also restrictions on which EVs meet the tax credit requirements. Here's which Tesla models are currently eligible for the entire $7,500 credit:

• 2024 Tesla Model 3 Performance
• 2024 Tesla Model Y
• 2024 Model X

2. Buy a used Tesla

Used Teslas are cheaper than ever. The car shopping platform CoPilot says the average cost of a used Tesla is down 36% from last year to $31,800. That means buying a used Tesla right now costs about $17,900 less.

You can lower your used Tesla price even further by taking advantage of the IRS's used EV tax credit. The IRS offers tax credits for 30% of the cost of a used EV up to $4,000.

Not all used Teslas qualify for the credit, but the ones that do need to meet these requirements:

• The vehicle must be purchased from a dealer
• The sales sale price has to be $25,000 or less
• The model year must be two years prior to the current calendar year

I did a quick search on Carvana and found plenty of used Teslas that matched the used EV tax credit criteria. After factoring in the credit, the sales price of at least one used Tesla Model S would be about $19,590.

3. Repair and maintenance costs

Consumer Reports recently compared the maintenance and repair costs of more than 30 car companies and found that Tesla ranked first as the least expensive to maintain. Maintenance and repairs cost just $580 for the first year and totaled only $4,035 over 10 years.

On the other hand, many luxury vehicles had some of the highest repair and maintenance costs. If you bought a Tesla rather than a vehicle from a top luxury brand, you could potentially save more than $7,500 over 10 years.

Here are five luxury car brands' maintenance and repair costs over 10 years, and how much more expensive their costs are compared to owning a Tesla:

• BMW: $9,500 ($5,465 more expensive)
• Audi: $9,890 ($5,855 more expensive)
• Mercedes-Benz: $10,525 ($6,490 more expensive)
• Porsche: $14,090 ($10,055 more expensive)
• Land Rover: $19,250 ($15,215 more expensive)

One more way to save money on a Tesla

While choosing the right Tesla model at a price you can afford is the most important part of the car-buying process, the next step could save you thousands of dollars in the long run: Buying car insurance.

EV insurance generally costs more than insurance for gas-powered vehicles because of their expensive battery packs and added complexity for electrical system repairs. Unfortunately, Teslas are some of the most expensive electric vehicles to insure.

That's why it's important to shop around and compare rates from different companies when buying EV car insurance. Considering that you're on the hunt for a Tesla bargain anyway, you might want to consider getting a few quotes for cheap car insurance while looking for deals.