Cybertruck’s astronomical demand is attracting scalpers. What will Tesla do about it?

The popularity of Tesla products has been on an exponential rise with each new product launch, and the CyberTruck is no exception.

As the release date approaches, the excitement and anticipation has reached a fever pitch among reservation holders, but not all have the same priorities: Some are simply desperate to lay hands on an innovative new product. Others want to make a quick profit from the overwhelming demand.

For those who intended to own and directly use the CyberTruck, there is a growing concern that parasitic profiteering could undermine the pricing structure for the CyberTruck and lead to early reservation holders paying a premium for their foresight.

For the people that made reservations purely to sell back to the secondary market, there are concerns about the measures Tesla could implement to retain that initial profit available for early production demand.

Both the Model 3 and Model Y have seen multiple price adjustments in each market globally to balance the demand vs waiting list issue.

When wait lists are too long some individuals are prepared to pay well over the retail price to jump the queue. This in turn makes the queue longer as scalpers take up delivery slots and hold the vehicles until sold again, which in turn makes it difficult to analyse the price point/demand balance.

As noted at the  recent investor day presentation; “A linear decrease in profit margins leads to an exponential increase in demand.”

The dynamic of waiting lists and pricing for a highly coveted product like the Tesla CyberTruck could be significantly impacted by parasitic profiteering. This is when individuals or companies purchase reservations or pre-orders with the sole intent of reselling them at a higher price to those who are willing to pay more to jump the queue. 

If potential buyers are priced out of the market or feel that the pricing is unjustifiably high, they may  turn to other manufacturers for their electric vehicle needs.

Tesla does reserve the right to cancel repeat orders for those they believe are taking part in these practices, however with CyberTruck demand growing and well over 1 million reservations in place, this particular tool may be ineffective.

Even with the enormous number of reservations placed, this may not be an accurate picture of demand, as many posts in social media and discussion forums suggest many reservationists intended to buy one for themselves and sell a second and/or third in  the secondary market for profit.

Many of these people on various forums have even suggested the second vehicle would be sold to help pay for the first. With this being a distinct  possibility, Tesla could/should introduce a new sales strategy to mitigate the one-off scalping risk.  

The launch prices for the various trim levels range from $39k to $69k. Elon Musk has recently stated that delays in production schedule and unanticipated cost inflation mean the final price will be higher than first announced.

For early reservation holders an increase in prices equivalent to those seen during the production  ramp of Model 3 and Y would price some out of the offering, potentially losing their place in the  queue or simply having to wait past their place in line until the price meets the point they can  manage.  

On a post in the Cybertruck Owners Club forum, one member has suggested that a two-tier pricing  structure and sales strategy be implemented to remove the punitive cost for early reservation holders that intended to be the end user of the product.

“A clearly articulated and restrictive clause in the contract of sale that disincentivises on selling for a stipulated time frame (12-18months), possibly a lease to buy contract,” they said.

“A small proportion of monthly production allocated to delivery centres that are only  available at auction.”

This suggests that if a person wants to own the vehicle straight out of the delivery centre with the capacity to immediately resell, they could buy it at open auction facilitated by Tesla at whatever the market on that day could support.

Additionally, if a person wants to take advantage of their reservation and buy it at a price with a profit margin analogous the rest of the Tesla product range, they would need to engage in a sales contract that removed their capacity to sell it for a designated time period.

There was significant pushback to this idea on cybertruckownersclub.com as it appeared  many of the contributing members intended to sell one or more of their reservations.

The OP argued that concerns about restrictive sales contracts leading to unacceptable and  potentially challenging legal arguments around ownership are addressed by the customer entering  into the sales contract of their choice.

The high demand for the Tesla CyberTruck may amount to an upwards of 5-year backlog of production capacity. This could create an inordinate potential for parasitic  profiteering, which could undermine the pricing structure and disrupt fair access to the CyberTruck for all reservation holders.

With reservations for the Tesla CyberTruck no longer being available in many markets, including Australia, and the delivery schedule for regions outside of North America remaining unclear, the electric vehicle community will be closely monitoring the situation to determine the extent of hype  versus genuine demand for the product.

The question is, will Tesla take a proactive approach in addressing this issue to support the integrity of the reservation process and ensure that all those who have placed their trust in the company are  able to purchase the CyberTruck at a fair and reasonable price?