Tesla Model 3 Is the Cheapest Luxury Car to Own

The Tesla Model 3 has distinguished itself in the electric vehicle market with top-tier safety, range, and performance credentials. However, the baby Tesla also has money-saving skills in the luxury car segment. In addition to its better features, the Model 3 depreciates less and costs less to own than its cheapest conventional and EV luxury competitors. 

Is the Tesla Model 3 a luxury car?

Although Tesla makes fancier options, like the Model S and Model X, the Model 3 is a luxury car. Kelley Blue Book (KBB) and Consumer Reports consider the Model 3 a luxury car, albeit a compact luxury vehicle. Consumer Reports says that the compact EV has comfortable front seats and an interior with stylistic simplicity that creates an air of luxury. However, unlike the Model S or other luxury cars on the market, the Model 3’s ride is harsh and stiff.  

A Tesla Model 3's interior is simple yet befitting of a luxury car.
The EV has a simple yet luxurious interior | Tesla

How much does a Tesla Model 3 cost right now?

After the latest price hikes, a Tesla Model 3 with rear-wheel drive (RWD) has a starting price of $48,990. However, the Long Range trim saw a modest price increase of around $3,500, taking the starting cost from $54,490 to $57,990. However, for the extra money, shoppers get dual-motor all-wheel drive (AWD) and an electric range of 358 miles. That substantial electric range contributes to the estimated $1,694 five-year fuel cost, nearly $7,500 less than the next competitor in the segment, the sporty little 2022 Audi TT.

Those price tags might seem high, but they represent KBB’s pick for the cheapest luxury car to own over five years. With an overall five-year cost to own of $43,626, the Model 3 costs over $13,000 less than the Audi TT. Also, KBB says that the EV model depreciates just $24,298 over five years, lower than the average for internal combustion (ICE) vehicles and much more than the industry average for EVs. Finally, the Model 3 boasts the lowest average insurance costs for the cheapest luxury cars to own. 

The Tesla Model 3, like this one, has one of the cheapest costs to own for any luxury car.
Tesla Model 3 | Tesla

Is it worth getting a Tesla Model 3?

A Tesla Model 3 offers a dual-motor Long Range variation for consumers who want to do more than just commute. Furthermore, if you want a quick EV, the Performance trim will launch you to 60 mph in just 3.1 seconds, faster than most sports cars. However, the Model 3 does have its setbacks. Consumer Reports suggests that the EV has distracting controls and too-harsh a ride to compete with the luxury cars like a Jaguar XF. 

What is the cheapest Tesla to own?

The Tesla Model 3 is the cheapest EV in the marque’s lineup and has the lowest overall to own over five years. Also, the Tesla Model 3 depreciates far less than other EVs on the market, meaning you won’t lose as much of your initial investment. 

Should you buy a cheap luxury car?

While you might have an issue with the words “luxury” and “cheap” cohabitating, there are instances where it works. If you want a luxury EV with the lowest cost to own and run, consider a Tesla Model 3. However, if you want a luxury quality interior, a sharp driving experience, and a low cost to own, consider a 2022 Audi TT. Scroll down to the following article to read more about EVs!


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