buying a car every year for almost no money

[vanpan]

I am thinking of selling my 1 year old car and buy a new one ( same car, same trip, just new model year). Let me know if you guys see any holes in this. Thinking of doing this on a yearly basis until the federal government helps.

Sept 2019 - Bought a 2020 honda clarity plugin base model for 30650 ( includes tax/title and all fees) . Dealer discounted 6300 below msrp.
I got a 800$ PGE rebate and a 7500 federal tax credit.
Net cost to me is - 22350


Aug 2020 - My car now has 6000 miles on it. I got an offer from carmax for 23000. If i sell, i profit 650$.

I am thinking of selling it and may be wait till nov/dec and buy a 2021 honda clarity plugin. We have 3 cars and after selling this will have 2. With Covid, 1 car less is even better. We dont need the money, but i though why not. The math adds up to a free car a year.

Anything i am missing ?

[neilpilot]

Your even further ahead if you stay with only the other 2 cars.

[jpelder]

You'll have to make sure that there's not a limit on eligibility for the tax credits (can only use x times per lifetime, must keep car for y years, etc.) Don't forget to count sales tax in your math each time if your state/municipality charges sales tax on car purchases.

Seems like a bit of a hassle to do every year, but if it works once or twice, I guess it's cool, too.

[Katietsu]

You'll have to make sure that there's not a limit on eligibility for the tax credits (can only use x times per lifetime, must keep car for y years, etc.) Don't forget to count sales tax in your math each time if your state/municipality charges sales tax on car purchases.

Seems like a bit of a hassle to do every year, but if it works once or twice, I guess it's cool, too.

I almost did this. I too received a great manufacturer rebate when I purchased so that the math definitely worked. But Covid interfered before I moved forward and I was on the fence about the hassle of it anyway. You also need to get a good price on the next car to make it work as a free car each year, don’t you? Slightly increased insurance for a newer car. Do need to consider sales tax. For me, that would mean a trade in would be better than CarMax but that is state dependent.

[Ron Ronnerson]

I like your plan if it is repeatable. Typically, when you buy a new car and then proceed to put miles on it over the course of a year, the car depreciates (often a lot). In this case, the opposite has happened due to the credits involved. It seems odd that this situation would be repeatable over and over. If so, what would prevent someone from buying many new cars and then immediately turning around and selling each of them for profit?

[Lee_WSP]

What makes you so sure the dealer is going to offer the $6,300 discount again?

[LilyFleur]

Interesting idea, especially if you can write off the sales tax if you itemize.

It seems this works because Honda has such good resale value.

My son tells me that used cars are selling at a premium due to a COVID-related desire to buy used rather than new.

[JS-Elcano]

The rebate will phase out once Honda has sold 200,000 of those cars. They've been selling them for a few years now, and it's one of the best-selling PHEVs, so they may get there sooner rather than later.

[VCC]

Used car prices are definitely up. Recently I sold my 2018 vehicle for 1k more than what I bought it for 2 years ago. Sold it to Carvana. They had the best price compared to Vroom, Shift, Auto Nation, Carmax. They said that until new car dealers start receiving normal amounts of cars from the manufacturers later this year used cars are worth a premium right now.

[02nz]

I don't believe the federal tax credit requires you to keep the car for a certain length of time, but some state incentives (e.g., California's CVRP) do. CVRP is now one rebate per person, starting from a certain date.

[vanpan]

Used car prices are definitely up. Recently I sold my 2018 vehicle for 1k more than what I bought it for 2 years ago. Sold it to Carvana. They had the best price compared to Vroom, Shift, Auto Nation, Carmax. They said that until new car dealers start receiving normal amounts of cars from the manufacturers later this year used cars are worth a premium right now.

Thanks. Tried Carvana and got a higher offer than Carmax.

[grabiner]

I like your plan if it is repeatable. Typically, when you buy a new car and then proceed to put miles on it over the course of a year, the car depreciates (often a lot). In this case, the opposite has happened due to the credits involved. It seems odd that this situation would be repeatable over and over. If so, what would prevent someone from buying many new cars and then immediately turning around and selling each of them for profit?

The used car should be worth a lot less. If you are willing to pay $30,000 for a car which comes with a $7500 tax credit, then you should only be willing to pay $22,500 for an identical car which is not eligible for the tax credit.

However, the market for cars, like any other market, is subject to fluctuating prices, and different prices in different segments. If a particular year and model is in oversupply, its price will be lower, and you will do worse if you sell this model and better if you buy it.

[Ron Ronnerson]

I like your plan if it is repeatable. Typically, when you buy a new car and then proceed to put miles on it over the course of a year, the car depreciates (often a lot). In this case, the opposite has happened due to the credits involved. It seems odd that this situation would be repeatable over and over. If so, what would prevent someone from buying many new cars and then immediately turning around and selling each of them for profit?

The used car should be worth a lot less. If you are willing to pay $30,000 for a car which comes with a $7500 tax credit, then you should only be willing to pay $22,500 for an identical car which is not eligible for the tax credit.

However, the market for cars, like any other market, is subject to fluctuating prices, and different prices in different segments. If a particular year and model is in oversupply, its price will be lower, and you will do worse if you sell this model and better if you buy it.

Makes sense. I'm just surprised that CarMax offered to pay so much for the car and would have thought they would reduce the price they are willing to pay by the amount of the tax credit for the reason you stated. Unless the car is a collectible or truly rare, a person shouldn't be able to sell a used car with some miles on it for more than the purchase price of a new one (credits factored into the equation). In any case, it's interesting to hear about things like this when they occur.

[Afty]

I like your plan if it is repeatable. Typically, when you buy a new car and then proceed to put miles on it over the course of a year, the car depreciates (often a lot). In this case, the opposite has happened due to the credits involved. It seems odd that this situation would be repeatable over and over. If so, what would prevent someone from buying many new cars and then immediately turning around and selling each of them for profit?

The used car should be worth a lot less. If you are willing to pay $30,000 for a car which comes with a $7500 tax credit, then you should only be willing to pay $22,500 for an identical car which is not eligible for the tax credit.

However, the market for cars, like any other market, is subject to fluctuating prices, and different prices in different segments. If a particular year and model is in oversupply, its price will be lower, and you will do worse if you sell this model and better if you buy it.

You have to have >$7500 of Federal tax liability to claim the full credit, and even then you have to wait until tax time to receive it. It can't be rolled into your monthly payments unless you lease.

A lot of people either don't have enough tax liability to be eligible for the full $7500, or they are focused on monthly payments. I could imagine this leading to arbitrage opportunities for people like the OP.

[Ron Ronnerson]

I like your plan if it is repeatable. Typically, when you buy a new car and then proceed to put miles on it over the course of a year, the car depreciates (often a lot). In this case, the opposite has happened due to the credits involved. It seems odd that this situation would be repeatable over and over. If so, what would prevent someone from buying many new cars and then immediately turning around and selling each of them for profit?

The used car should be worth a lot less. If you are willing to pay $30,000 for a car which comes with a $7500 tax credit, then you should only be willing to pay $22,500 for an identical car which is not eligible for the tax credit.

However, the market for cars, like any other market, is subject to fluctuating prices, and different prices in different segments. If a particular year and model is in oversupply, its price will be lower, and you will do worse if you sell this model and better if you buy it.

You have to have >$7500 of Federal tax liability to claim the full credit, and even then you have to wait until tax time to receive it. It can't be rolled into your monthly payments unless you lease.

A lot of people either don't have enough tax liability to be eligible for the full $7500, or they are focused on monthly payments. I could imagine this leading to arbitrage opportunities for people like the OP.

Thanks for clarifying the point about it not being a refundable tax credit. I wasn't sure how that worked. It's surprising to me that this arbitrage opportunity exists for anyone actually.

[vanpan]

I like your plan if it is repeatable. Typically, when you buy a new car and then proceed to put miles on it over the course of a year, the car depreciates (often a lot). In this case, the opposite has happened due to the credits involved. It seems odd that this situation would be repeatable over and over. If so, what would prevent someone from buying many new cars and then immediately turning around and selling each of them for profit?

Agree this is probably not repeatable for ever. Might be able to do this once more next year, before honda runs out of its tax credit quota. That said this can not be done at scale because ....

"The federal tax credit isn't applicable to an electric vehicle being purchased for the purpose of reselling it. That's a gray area, though, and would be tough for authorities to prove."

If you gte a credit for lets say 10 cars, the IRS is going to investigate.

[vanpan]

What makes you so sure the dealer is going to offer the $6,300 discount again?

These cars are priced at the same as a Tesla Model3 and all things being equal most people will buy a model 3 if both cars have the exact same price.. Hence the dealers are forced to discount. Also in California they have to sell high MPGe cars to meet emission standards. While this will not be true for ever, i see it being true for this specific car model for the next couple of years.

[randomguy]

What makes you so sure the dealer is going to offer the $6,300 discount again?

These cars are priced at the same as a Tesla Model3 and all things being equal most people will buy a model 3 if both cars have the exact same price.. Hence the dealers are forced to discount. Also in California they have to sell high MPGe cars to meet emission standards. While this will not be true for ever, i see it being true for this specific car model for the next couple of years.

And why hasn't the used market reflected that? Why is someone paying 25k (or whatever carmax ends up selling it for) for a used car instead of buying it new for 23k? Some times there are rebates a lot of people aren't eligible for (i.e. you get 1500 from your city and 3k from your state) which gives you a big rebate arbitrage play but 800 bucks doesn't seem like an enough.

Obviously the risk here is that you go to buy the car in November and have to pay say 27k instead of 22.3k. Nobody can tell you if that will happen or not.

[02nz]

Sept 2019 - Bought a 2020 honda clarity plugin base model for 30650 ( includes tax/title and all fees) . Dealer discounted 6300 below msrp.
I got a 800$ PGE rebate and a 7500 federal tax credit.
Net cost to me is - 22350


Aug 2020 - My car now has 6000 miles on it. I got an offer from carmax for 23000. If i sell, i profit 650$.

OP, how have you liked the Clarity? It's on my list of potential replacements for my Volt when the lease ends (about a year from now).

[michaeljc70]

My guess is this worked because of Covid more than anything else. I doubt it is repeatable. If it is, people on the internet will be reading this, driving up the price and make it not repeatable.

[02nz]

And why hasn't the used market reflected that? Why is someone paying 25k (or whatever carmax ends up selling it for) for a used car instead of buying it new for 23k? Some times there are rebates a lot of people aren't eligible for (i.e. you get 1500 from your city and 3k from your state) which gives you a big rebate arbitrage play but 800 bucks doesn't seem like an enough.

Well the $7500 federal rebate isn't refundable, so a lot of people cannot get all of it. And there is probably something of an information gap - even some PHEV/EV buyers may not know about all of the available incentives that can bring down the cost. In CA for example, an EV after all federal, state, and utility incentives is cheaper than an economy ICE car.

[LittleMaggieMae]

how much does it cost you to sell it to carmax? Does the 23000 include all the taxes, fees, transfers charges, etc?

[Jack FFR1846]

how much does it cost you to sell it to carmax? Does the 23000 include all the taxes, fees, transfers charges, etc?

Where do any of those costs apply? If I sell a car, there's no anything. You pay when you buy.

[vanpan]

Sept 2019 - Bought a 2020 honda clarity plugin base model for 30650 ( includes tax/title and all fees) . Dealer discounted 6300 below msrp.
I got a 800$ PGE rebate and a 7500 federal tax credit.
Net cost to me is - 22350


Aug 2020 - My car now has 6000 miles on it. I got an offer from carmax for 23000. If i sell, i profit 650$.

OP, how have you liked the Clarity? It's on my list of potential replacements for my Volt when the lease ends (about a year from now).

I like the car. its not fancy but does the job. Its cheap (cheaper than an accord in california) and fuel efficient. Here is my take

+ves
cheap
quite
fuel efficient
no range anxiety ( backup gas after 45 miles)
spacious inside
spacious trunk ( i can fit 3 large boxes)
seats are comfortable

-ves
ugly styling
blind spot monitoring ( is really bad, i have a 2019 odyssey and its much better on the odyssey, its a camera instead of a beep)
front center console has a very weird design and wastes a lot of space
the automated driving is a checkmark compared to a tesla

[vanpan]

What makes you so sure the dealer is going to offer the $6,300 discount again?

These cars are priced at the same as a Tesla Model3 and all things being equal most people will buy a model 3 if both cars have the exact same price.. Hence the dealers are forced to discount. Also in California they have to sell high MPGe cars to meet emission standards. While this will not be true for ever, i see it being true for this specific car model for the next couple of years.

And why hasn't the used market reflected that? Why is someone paying 25k (or whatever carmax ends up selling it for) for a used car instead of buying it new for 23k? Some times there are rebates a lot of people aren't eligible for (i.e. you get 1500 from your city and 3k from your state) which gives you a big rebate arbitrage play but 800 bucks doesn't seem like an enough.

Obviously the risk here is that you go to buy the car in November and have to pay say 27k instead of 22.3k. Nobody can tell you if that will happen or not.

You are right. it really is cheaper to buy a new clarity than a used one. The only scenario where this is not true is if you owe less than 7500 in fedral taxes ( i am assuming this is rare). This doesn't make sense, but is the reality. I also called my dealer and he is willing to sell me a 2021 clarity at the same price he sold me last year.

[RocketShipTech]

OP do it.

I own a 2018 Nissan Leaf purchased new and was basically in the same situation as you last year and now regret not selling it.

[02nz]

Sept 2019 - Bought a 2020 honda clarity plugin base model for 30650 ( includes tax/title and all fees) . Dealer discounted 6300 below msrp.
I got a 800$ PGE rebate and a 7500 federal tax credit.
Net cost to me is - 22350


Aug 2020 - My car now has 6000 miles on it. I got an offer from carmax for 23000. If i sell, i profit 650$.

OP, how have you liked the Clarity? It's on my list of potential replacements for my Volt when the lease ends (about a year from now).

I like the car. its not fancy but does the job. Its cheap (cheaper than an accord in california) and fuel efficient. Here is my take

+ves
cheap
quite
fuel efficient
no range anxiety ( backup gas after 45 miles)
spacious inside
spacious trunk ( i can fit 3 large boxes)
seats are comfortable

-ves
ugly styling
blind spot monitoring ( is really bad, i have a 2019 odyssey and its much better on the odyssey, its a camera instead of a beep)
front center console has a very weird design and wastes a lot of space
the automated driving is a checkmark compared to a tesla

Thanks. My assumption is that whenever the Clarity gets a redesign it will switch to a more conventional blind-spot monitoring system like on the Odyssey, rather than the rather useless "LaneWatch" camera, which is installed on the passenger side where it's much less useful.

[RocketShipTech]

OP just curious why are you waiting for the 2021 model to come out? There are no changes from the 2020 model.

Are you thinking that the newer model year by itself will have higher resale value?

[IowaFarmBoy]

I think the biggest variable in this plan is what the value of a used car will be in a year when you try to trade the new car. From what I understand, the used car market is very hot right now. I read an article in the last day or two (WSJ or online somewhere?) about used car dealers scrambling for inventory- doing things like buying cars on craigslist, having to pay a lot more at auctions than normal, etc. That is probably what makes this deal work this year. I would expect that used car pricing will normalize in a year or two and this deal will not likely repeat itself. It might be worth doing this year (and as long as you can) with the expectation that at some point you return to the "normal" pattern of keeping the car for several years.

[MathIsMyWayr]

If you buy low and sell high, you make money. That is how businesses works. Question is whether you can consistently.

[Globalviewer58]

Are you including state and local sales tax, title fee and license in your figures? I see CA charges 7.5% state sales tax on value before rebates and incentives with another 2.5% local tax possible.

[Shorty]

Sell now - well played. Take advantage of localized inefficiencies that the government creates. I always say that "it's expensive to be poor". This seems to be a corollary. Like someone else says, I'd be wary of doing it too many times on the IRS side. Also, assuming you plan on holding the car anyways. How much more valuable to you is the newer car? Better features? Seems like a screaming deal if it's worth your effort. I think the value blurs somewhat at a 4 vs 5 year old car, especially EV as that market changes so quickly. You could be the odd person out in musical chairs.

If it were me - I'd pat myself on the back and buy a Tesla. Or take a time machine back and buy Tesla stock with the money . On a serious note, the Toyota RAV 4 Prime is the next such instance. Low mfr supply and high demand. It might sell well above MSRP.

[wander]

With 8% (rule of thumb) stock market return, you should compare with $24130 (minus tax) a year later when you sell the car. Since you have 3 cars, you also need to add premium insurance for the new car that you don't need.

[soxfan10]

What makes you so sure the dealer is going to offer the $6,300 discount again?

These cars are priced at the same as a Tesla Model3 and all things being equal most people will buy a model 3 if both cars have the exact same price.. Hence the dealers are forced to discount. Also in California they have to sell high MPGe cars to meet emission standards. While this will not be true for ever, i see it being true for this specific car model for the next couple of years.

And why hasn't the used market reflected that? Why is someone paying 25k (or whatever carmax ends up selling it for) for a used car instead of buying it new for 23k? Some times there are rebates a lot of people aren't eligible for (i.e. you get 1500 from your city and 3k from your state) which gives you a big rebate arbitrage play but 800 bucks doesn't seem like an enough.

Obviously the risk here is that you go to buy the car in November and have to pay say 27k instead of 22.3k. Nobody can tell you if that will happen or not.

You are right. it really is cheaper to buy a new clarity than a used one. The only scenario where this is not true is if you owe less than 7500 in fedral taxes ( i am assuming this is rare). This doesn't make sense, but is the reality. I also called my dealer and he is willing to sell me a 2021 clarity at the same price he sold me last year.

Not rare at all - that is why the market is operating the way it is (1 year used car selling for more than a new less credit) - it is the distortion in the market created by a large non-refundable credit. Maybe 20%-30% of the country could use the entirety of that credit. 45% of people have zero tax liability after the credits they are entitled to prior to any electric car credit.

To the general plan, its probably not more than a one (or perhaps two) time deal. the credits phase out and the market will no longer operate similarly.

[ClevrChico]

One downside I see is that you may be paying more for car registration long term if your state is like mine. (Ours is a sliding scale based on car age.)

If you carry comprehensive insurance, you'll be paying more long term, vs liability on a depreciated car.

You'll be paying a doc fee at the dealer for every transaction.

These costs will probably wipe out your "profit", but you'll have a new car every year.

[Helo80]

Yes, this can be done in the used exotic market (e.g. 911, Lambo) if you know what you are doing. A lot of enthusiasts and sometimes youngings you see on YT are doing this. It's not easy though, takes time to understand the ins/outs of the market and recognizing when a good deal is present or betting on an option becoming more popular over time. In some cases the cars appreciate over time. Though, I consider it like stock pickings on BHs... there's a bit of gambling and luck involved.

For traditional mass production commuter cars, this is not the case. OP, I think you're getting premium COVID pricing now as the used car market is in a supply dearth. People are extending leases, in-person auctions are not running now. The auctions that are running have more competition from the dealers. Used car auction sales are going for above retail.

OP, I would pull the trigger and exchange and move into a more ICE friendly car. I don't think the Clarity is selling well at all (at least outside of California). So, I think the depreciation curve might be higher than normal.

[dodecahedron]

You are right. it really is cheaper to buy a new clarity than a used one. The only scenario where this is not true is if you owe less than 7500 in federal taxes ( i am assuming this is rare). This doesn't make sense, but is the reality. I also called my dealer and he is willing to sell me a 2021 clarity at the same price he sold me last year.

Not rare at all - that is why the market is operating the way it is (1 year used car selling for more than a new less credit) - it is the distortion in the market created by a large non-refundable credit. Maybe 20%-30% of the country could use the entirety of that credit. 45% of people have zero tax liability after the credits they are entitled to prior to any electric car credit.

To the general plan, its probably not more than a one (or perhaps two) time deal. the credits phase out and the market will no longer operate similarly.

Totally agree with soxfan10. A relatively small percentage of American households have tax liability exceeding $7,500. And many/most of those who do have tax liability north of $7,500 may well be looking for higher end models with bigger price tags. Certainly the kind of person who think s/he can barely scrape together $23,000 to buy a one-year-old Clarity is unlikely to have an income high enough to rack up $7,500 in tax liability, especially in this COVID year.

These are not ordinary times. If I were the OP, I would get rid of this car and take my sweet time on replacing it, since it sounds like your current vehicle needs are much less than you thought they would be at the time you purchased it. You will save on insurance and maintenance in the meantime.

This is not something you can count on recurring.

[RocketShipTech]

The fact that Honda has pulled Clarity inventory from all dealers except California makes me think Clarity depreciation will slow.

Surely there are people outside of CA who are interested in buying a car that can go 47 miles on EV range alone, plus 280 miles on gas.

I bet those people will be keeping resale values high well into next year.

[stan1]

Arbitrage opportunities like you describe don't persist long term. Posting about it in this forum will help shorten its life as thousands of people will read about it. If you want to take advantage of it, great, and move out. Don't expect it to persist.

Also realize arbitrage usually comes with some level of risk. For example this weekend a poster on this forum lamented that they missed escrow closing because they were keeping down payment for a home in a higher interest account at Ally and wanted to leave it there for a few extra days. Ally didn't turn the wire transfer around in 24 hours. The poster had to pay significant costs to extend the mortgage lock and lost a non-refundable deposit to their movers. In your case the out the door cost from the dealer could change, or the trade in value could change.

[vanpan]

Thanks Everyone for the inputs. Just an update. I ended up selling the car for 23694 on carvana. A rough 1300 profit ( minus insurance costs). I am going to wait out for the pandemic to get over and see if i really need an electric car ( for the carpool sticker) for my bay area commute. The carpool sticker was saving me 20 mins each way.

[RocketShipTech]

Without any negotiation I am able to get an offer on a new Clarity for $32,300 OTD:



Subtract $7500 federal tax credit and $800 PG&E rebate and the effective price is $24,000.

I am pretty sure I’ll be able to get $24k for the car in 12 months (I plan on driving it only 5k miles)

Man this is tempting!

[brajalle]

Without any negotiation I am able to get an offer on a new Clarity for $32,300 OTD:

Subtract $7500 federal tax credit and $800 PG&E rebate and the effective price is $24,000.

I am pretty sure I’ll be able to get $24k for the car in 12 months (I plan on driving it only 5k miles)

Man this is tempting!

A 1yr old Clarity with 5k miles and I'd only have to beat $24k? I'd top that in a heartbeat since I can't max out the federal credit, don't get state/local/utility, and am in the market for a Clarity in the next 6-24 months (albeit I'd prefer and pay more for a Touring model). Probably not a huge pool of people like me, but I'd say there's enough that I'm sure you could beat that Carvana price if you wanted to bother with a private sale.

[Dudley]

Morals.

[MathIsMyWayr]

Without any negotiation I am able to get an offer on a new Clarity for $32,300 OTD:

Subtract $7500 federal tax credit and $800 PG&E rebate and the effective price is $24,000.

I am pretty sure I’ll be able to get $24k for the car in 12 months (I plan on driving it only 5k miles)

Man this is tempting!

A 1yr old Clarity with 5k miles and I'd only have to beat $24k? I'd top that in a heartbeat since I can't max out the federal credit, don't get state/local/utility, and am in the market for a Clarity in the next 6-24 months (albeit I'd prefer and pay more for a Touring model). Probably not a huge pool of people like me, but I'd say there's enough that I'm sure you could beat that Carvana price if you wanted to bother with a private sale.

Can you manufacture some taxable income to meet the federal tax credit? For example, selling appreciated investment will do. You may buy them back at the appreciated price immediately after selling.

[Jack FFR1846]

You likely can rotate the car for a new one once or maybe twice. This follows any high demand car and you are getting the government cheese for buying the car. It's not going to continue forever. Why? Just like with Teslas, buying new was difficult with year long waits and huge waiting lines. But now, there's no line to buy a Tesla. So the premium for waiting is gone. Next is the government cheese that you receive. That drys up as the car reaches numbers. Rich Rebuilds talks about Tesla owner ads for used cars at more than new because these owners remember the waiting lines and think they can get that premium for the car. When buyers look at a new car purchase and then a used and see that for the same money, they can buy new, why would they buy used? So prices drop. This is what will happen with your car. So yes, you can do that this time, but next year? 2 years down the line? Probably not. Instead of the big cheese rebates from the government, it'll be just a small slice. And the trade in value is going to drop into the Leaf range.

So in short.....do it now if you want. But don't expect it's going to continue.

[oko]

I did this last year. Traded in my 2018 Clarity Base for $24,300 and bought a brand new Touring (an upgrade). Out of pocket cost: $7,350. Tax Rebate: $7,500. Net cost: -$150.

I can not do this this year since:

1-Clarity's are not sold in Texas any more (or in most states).
2-The ones sold in CA are not that cheap, and even if it was, it is too much hassle to buy/trade-in from there.

[RocketShipTech]

Morals.

Can you explain what is immoral about this?

[RocketShipTech]

Well I decided to pull the trigger.

MSRP for base model Clarity: $34,355
Taxes & DMV fees: $3,179
BS dealer charges and accessories: $433
Negotiated discount: -$6,155
Total OTD cost: $31,912

This is the absolute lowest price at the moment in the Bay Area. I reached out to a dozen dealers.

3% cash back credit card on $2,500: -$75
Federal tax credit: -$7,500
PG&E rebate: -$800
Net cost: $23,537

I will report back in 12 months what I sold it for.

[RocketShipTech]

Agree this is probably not repeatable for ever. Might be able to do this once more next year, before honda runs out of its tax credit quota.

According to this EV sales tracker Honda has only sold 30k tax credit qualifying EVs as of mid 2019, and is only selling 1k per month.

At this rate it will take another 13 years before Honda hits the 200k limit.

Not to mention Hyundai, Kia, VW, Mitsubishi, Subaru, which haven’t really even started selling EVs en masse but have new EVs in the pipeline.

[Political comment removed by moderator oldcomputerguy]

All of which make me think this will be a viable long term strategy.

[prairieman]

I went to our Honda dealer, cash in pocket, to test drive a Clarity and they gave me nothing but a cold shoulder. Ended up with a Prius Prime which was hard to find, too.
Overall, I find switching cars yearly to take advantage of multiple government rebates to be (1) a lot of work for little personal gain and (2) an abuse of a government incentive program. The odds seem pretty high that somewhere along the line you’ll end up losing out - time, taxes, government Rebate’s fine-print....