I bought a Tesla Cybertruck for $100

What's up you guys? It's Graham here. So yeah, I did a thing last night. After watching non-stop videos, reading non-stop articles, and researching every aspect of this fine, odd piece of machinery, I decided to reserve a spot to order the upcoming Tesla Cybertruck in 2021. The total cost to reserve this spot was just a refundable deposit of $100. Apparently, I'm not alone in doing this either, because just last night, Elon Musk tweeted that they just surpassed two hundred thousand reservations in the first three days. Which, I'll admit, seems very impressive for such an unconventional truck designed with the aesthetics and inspiration of origami.

And I'll be honest, coming from somebody who drives a Tesla Model 3, I've never been much of a truck guy, but this thing is just... else. And that I have a feeling is exactly what Elon Musk was going for. Now let's begin by talking about the aesthetics. Because at first glance, it looks as though he's unveiling the new SpaceX Mars rover here on Earth. And that design was done very intentionally, and maybe not for the reasons you were thinking.

Now, in terms of practicality, it makes sense, because the car is designed for durability. See, normally most cars are built off of a frame, and the design you see on the outside is mostly for aerodynamic and styling purposes. But this stainless steel exterior, or exoskeleton as he calls it, is the frame itself, and it's designed to resist dents, impact, and protect its passengers. Unless, of course, you throw something at the window.

So given all of that, an ultra-strength stainless steel exterior is really just the way to go. But doing that presents a challenge. Actually manufacturing a vehicle of this material is extremely difficult, and that is partly why we see such an angular design. Just because it had to be to keep the cost down. As Elon Musk clarified on Twitter, this stainless steel is so strong that it can't easily be molded and stamped without literally breaking the machine. So building a car from all of these flat shapes just meant less work required and less overhead cost to manufacture.

Instead, you just stamp and cut pieces together and then you fold it into a truck. Done! Not to mention, this material is the same stainless steel used within SpaceX, meaning it could also be quite cost-efficient when manufacturing and using such large quantities. However, I think there's also another reason for such an extreme design in that it's different and it's polarizing. People either love it or they hate it, but absolutely no one is neutral about it.

And that would have one major advantage for Tesla, and that would be publicity. To me, this is just the ultimate PR stunt because it is so different from anything else in real life. If you love the design, you'll probably think it's so cool that you'll talk about it and then maybe place a deposit. And if you hate the design, then you're definitely talking about it and telling people how much you dislike it. And also telling people to be shorting Tesla stock. But either way, you're talking about it. And the more attention Tesla gets right now, the better this is. Because in business, being polarizing is often celebrated.

It distances the people who are not going to be interested in it and brings you closer to the people who are absolutely going to love it. And from that, I believe William Shakespeare said it best: "Love me or hate me, both are in my favour. If you love me, I'll always be in your heart. And if you hate me, I'll always be on your mind." To me, this was exactly what Tesla went for.

It was a way for them to get massive attention, massive PR, and get everyone talking about them. And the results are pretty evident. Over 200,000 deposits were placed over the first weekend with zero advertisements or paid endorsements. The car is just flat-out memorable, and I believe in some way this was also a major factor in the success of the Tesla Model 3. Not only was the price point a talking point for the entire car industry, but the interior was unlike anything else we have ever seen.

And I'll admit, at first, I thought it was really weird. I just couldn't wrap my brain around just having a single screen in the middle of the car and nothing else. And it just looked way too futuristic. Yeah, once I actually got the car, I realized how genius of a concept this was, and now I could never go back to any other car ever again with all the buttons and stuff. Now it just, to me, seems way too complicated.

But again, at the time, that interior was memorable. It was different and it got a lot of people talking about it, which was good for Tesla. So if Elon Musk went and designed a car that looked anything like a normal pickup truck, most likely we would not be talking about it. It would just be another rendition of an overly competitive market of the pickup truck industry.

Like, take the Model Y for example. In my opinion, it was just an underwhelming announced vehicle. While it certainly served a practical need in the crossover marketplace, it just wasn't that different from what was already available. And while we can only assume how many pre-orders the Model Y received, I have a feeling it was most likely less than spectacular.

Why do I say this? Well, it just seems like Elon Musk is very quick to share information when there is reason for the shareholder to celebrate. Like, he was very quick to announce the pre-order information for the Model 3, and very quick to provide these statistics for the Cybertruck. Yeah, we haven't heard a single word about the upcoming sales numbers or success of the Model Y. Why? Well, that's because I believe there was maybe less demand than expected.

With that, there's no reason to publicly share any less than amazing information. Anyway, this type of polarization under the Cybertruck context is really, really good for Tesla, especially at a time where they're soon going to be competing with Rivian, another electric car company promising a pickup truck around the same time in late 2021.

Now in terms of impressive reservation numbers, however, I do have my doubts. As big of a fan as I am of Tesla, here's the thing: I placed my deposit for the Tesla Cybertruck because I felt like a $100 fully refundable deposit with such a low barrier to entry that I may as well just give $100 to reserve my spot and then decide two years from now whether or not it was going to be a viable purchase. If yes, great, I will go ahead and get the car. And if not, then it was only $100 and I will get that back.

For Tesla, however, $100 multiplied by 200,000 deposits means an interest-free loan essentially of twenty million dollars that they could do whatever they want with. It's twenty million dollars interest-free just over the first weekend. That doesn't even include all the other people who are going to be placing deposits over the next few days, weeks, months, or even year. So I have a feeling this interest-free loan to Tesla is going to be much, much larger.

Not to mention, the more people invest in this truck early on, the more they think about it and the more likely they are to actually purchase the car when it comes out. Because they've waited already for such a long time. But I hate to be a Debbie Downer, especially because I love my Tesla Model 3 and I ended up buying Tesla stock at the time I bought the car. But I can't help but think that charging a $100 fully refundable deposit is actually going to be a good measure to decide how many people will be really willing to buy the car once it comes out.

Especially hearing that from Elon Musk, 41% of its customers pre-ordered the most expensive option of the car, which I find somewhat hard to believe that 41% of those people would buy the most expensive option once presented with the actual car and the bill to go and buy that car. Anecdotally, I will tell you that I've seen a lot of people place $100 deposits to get the car who either cannot afford the car, hope to be able to afford the car by the time it comes out, or they just want to show their support for Tesla or impress their friends by posting it on Instagram that they've got one for basically the cost of dinner for two at a fancy restaurant.

Now, maybe I'm totally wrong here, but I think this may have been done on purpose to somewhat artificially inflate the amount of demand there is for this truck. Now, I don't say this to take away from the car, because I think it's brilliant, and I think Elon Musk is a genius. But we can't ignore that on previous models, the deposit to pre-order the car has been significantly higher.

Now right now, when taking pre-orders, the Tesla Roadster has a $50,000 refundable deposit, $5,000 due upfront, $45,000 due within 10 days. The Model Y has a refundable deposit of $2,500. The Model 3 has a refundable deposit of $1,000. And when the Tesla Model X was first announced, the deposit ranged anywhere from five thousand dollars all the way up to $40,000 for a Founders Series. And then with the Cybertruck, it's only $100.

It seems like this was almost done intentionally, so that anyone who was even remotely interested in the car would just plop down $100 as a way to show their support for the company and the car. In the short term, it means immediate cash for Tesla to use for the next few years. It means a lot of immediate PR coverage for the entire company as a whole, and all of that just means more eyeballs on Tesla.

But in terms of how many of those deposits will actually convert over to sales, well, we can look back at previous numbers to get a bit of a gauge. With the Tesla Model 3, they received a whopping 230 million deposits in the first day, each with a $1,000 deposit. For context, that's equivalent to Tesla receiving 232 million dollars upfront in one day for a car that isn't yet even in production at the time.

So that was pretty amazing, because $1,000 is a pretty strong commitment that most likely you're intending to buy the car from. However, 25% of people ended up refunding their pre-order. And that makes sense. There were numerous setbacks. The $35,000 car wasn't available until much later, and a lot of people, I'm sure, just got impatient. So I think it's pretty reasonable to conclude that a $100 deposit is going to have a much higher refund rate just given that the barrier to entry is that much lower.

Because I'll tell you, if Tesla increased the deposit from $100 to $1,000, we would see far fewer people just going and placing $100 deposits on a whim to preorder the car. And from that, those pre-order numbers might end up looking far worse for Tesla. Regardless, though, I have to say this car is nothing short of impressive when you compare the stats between other competitors.

Like the crowned king of pickup trucks, the Ford F-150. On the left, we have the new 2020 F-150, and on the right, we have the new Mars rover... the Ford starts at twenty-eight thousand four hundred and ninety-six dollars. The Cybertruck starts at thirty-nine thousand nine hundred dollars.

The Ford has a payload of three thousand two hundred and seventy pounds. The Cybertruck has a payload of thirty-five hundred pounds. The Ford is able to tow twelve thousand three hundred pounds, while the Cybertruck is able to tow fourteen thousand pounds. The Ford is not bulletproof, while the Cybertruck is bulletproof.

The Ford has seventy-seven point four cubic feet of storage, while the Cybertruck has 100 cubic feet of storage. The best F-150 has a zero to sixty at five point one seconds, while the best Cybertruck has a zero to sixty up to two point nine seconds. And I think it's safe to say that both windows will break if you throw something at it. That was a joke!

Honestly, though, jokes aside, it's easy to see how just for a little bit more money, you get a much more unique experience and value with the Cybertruck. Even more when you compare it to the Rivian to see how good of a value the Cybertruck really is. The Rivian starts all the way at sixty-nine thousand nine hundred dollars.

It has a payload of one thousand seven hundred and sixty pounds, it could tow up to eleven thousand pounds, it is not bulletproof that we know of, and they have not released how much storage the back will have. The zero to sixty is 3.2 seconds, and the windows will still probably break if you throw something. So to me, it still seems like a no-brainer.

As long as Tesla can actually deliver, it's going to outperform and out-value other cars within the same segment. Now, some might argue that the cargo space isn't as practical as other cars, and I still believe it's probably more like a work in progress. But let's be real. Studies have found that most people who buy pickup trucks are not doing so because of their functionality.

It was found that 75% of truck owners used their truck for towing one time a year or less, meaning never. Nearly 70 percent of truck owners go off-road one time a year or less, and a full 35% of truck owners use their truck for actual hauling or putting something in the bed once a year or less. So given that, I think most people are going for style and performance first with functionality being a close second.

Oh, and also not to mention one of my favorite parts about the entire Tesla Cybertruck, and one of the reasons why I believe this could be a good deal financially. Just listen to this! This is because the car is estimated to weigh over 6,000 pounds, much like the Tesla Model X. That means it's eligible for what's known as the section 179 tax deduction.

And even better, wait for it: bonus depreciation. Now, this is a tax deduction that applies to business owners who intend to purchase a car for more than 50% business use, for that car weighs more than six thousand pounds. Which, as a pickup truck, could largely be used by contractors, people in the construction industry, and anyone who's self-employed and uses the car to transport people or equipment around.

This type of tax deduction means that heavy vehicles like this classify as heavy machinery. And from that, section 179 says that you could depreciate the car up to $25,000 in the first year. Then you have what's known as bonus depreciation. This allows you to potentially depreciate up to 100 percent of the cost of the vehicle in the first year it goes into service.

Meaning that potentially, depending on your business, its intended use, and how you file your taxes, you might be able to write off a hundred percent of the cost for a Tesla Cybertruck in a single year against your taxes, depending on if you use it primarily for business. And since I use my car primarily for business purposes anyway, that means that I might potentially be able to buy this car in late 2021 and then use the cost of the car as an entire write-off against my income in that single year.

And for someone in the high tax bracket, depending on the state you live in, that could mean a potential savings of over 50 percent of the cost of a Tesla Cybertruck in one year. So the tax savings on this alone would be quite large. Not to mention the federal EV tax rebates available in 2021.

As for me, that's right! I figured a $100 deposit, may as well do it and see what happens. And then two years from now, as the entire design of the car becomes more clear, I could decide at that time whether or not I'm going to be actually getting one. Plus, I also think a lot of other people are in the exact same boat as well.

They see it as an innovative new design. It's absolutely unique. It's priced in line with more conventional vehicles that are nowhere near as exciting or cool. And a hundred dollar deposit is such a low barrier to entry that most people would be able to do that on a whim and then later just see what happens.

Then Tesla can talk about really impressive sales numbers, potentially drive more interest, and then take a new direction with Tesla, which I hope a lot of their other cars will be looking as unique as this one. And all in all, for those who are not in love with the design, at least for me, it grew on me.

Plus, for business owners out there, much like the Tesla Model X, it could be a good financial tax write-off. Not financial advice, for entertainment purposes only. So I just see this as a massive win for Tesla. And coming from someone who currently drives a Tesla Model 3, I have to say once I drove an electric car like that, I can never go back to driving any other normal gas-powered car.

It's truly such an amazing experience, and everything about the car has been phenomenal. I think Elon Musk has done a really great job, and I'm really excited. I'm really excited to see what comes of the Mars rover. I mean Tesla Cybertruck. So with that said, you guys, thank you so much for watching. I really appreciate it.

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