Has anyone sold their leases Model 3 to a dealer? [as of 10/28/21 not possible any longer]

[CapeOne]

Rental agencies have similar rules. You can't just rent a car "for the weekend" and then go off and sell it to a 3rd party dealer.

It's not the same thing. The issue being discussed is that Tesla changed the terms (lease end options) after the lease was signed. Instead of a choice of turning the car in or selling to a third party dealer, the only option now is turning the car in.

When renting a car for the weekend, one of the "return options" would never have been going off and selling the car to a third party dealer.

 

[CapeOne]

The only reason I can think of is if Tesla is 100% dead set on taking every single leased M3 back and using it for their supposed robo taxi fleet or whatever they're calling it.

Due to this year's inventory shortages, manufacturers are trying to get back as many cars as they can so they (or their dealers) have cars to resell.

 

[jjrandorin]

It's not the same thing. The issue being discussed is that Tesla changed the terms (lease end options) after the lease was signed. Instead of a choice of turning the car in or selling to a third party dealer, the only option now is turning the car in.

When renting a car for the weekend, one of the "return options" would never have been going off and selling the car to a third party dealer.

If it was 'changing the lease terms" you might have a point, but I doubt anything at all about selling your leased tesla is in the terms, just like it wasnt for all the other brands that are now doing the same thing (most of them much earlier than October of this year).

https://cars.usnews.com/cars-trucks/lease-end-options-restrictions

 

[Gauss Guzzler]

...Tesla changed the terms (lease end options) after the lease was signed.

What terms? I haven't seen any signed lease agreements explicitly granting the lessee this option.

Are you referring to the lease return options listed on their website? Those aren't "terms", they're current offerings.

 

[CapeOne]

If it was 'changing the lease terms" you might have a point, but I doubt anything at all about selling your leased tesla is in the terms, just like it wasnt for all the other brands that are now doing the same thing (most of them much earlier than October of this year).

It really depends on what is specified in the lease contract. Whether or not someone would have a "case" here would depend on how their contract is written.

Yes, I noted in an earlier post that at least two other automakers (GM and Honda) were doing something similar.

 

[CapeOne]

What terms? I haven't seen any signed lease agreements explicitly granting the lessee this option.

Are you referring to the lease return options listed on their website? Those aren't "terms", they're current offerings.

I was referring to whatever appears in the lease contract. Tesla had given Model 3 owners (and others) the option to sell the car to third party dealerships, depending on what was allowed under the lease contract. Each lessee would have to review their contract to see what is stated. If Tesla is no longer allowing certain options specified in the contract, that could be viewed as changing the terms of the contract. It depends on how it is written.

 

[jjrandorin]

I was referring to whatever appears in the lease contract. Tesla had given Model 3 owners (and others) the option to sell the car to third party dealerships, depending on what was allowed under the lease contract. Each lessee would have to review their contract to see what is stated. If Tesla is no longer allowing certain options specified in the contract, that could be viewed as changing the terms of the contract. It depends on how it is written.

I know you have a lot of knowledge in this area, but have you ever seen a lease contract that specifically spells out specific options for selling the vehicle? My BMW lease ( for example) had specific provisions on how I could turn the car back in, and how I could purchase it myself, but there are no provisions on whether I can sell it to a mercedes dealer (or any other non BMW dealer), for example.

Tesla leases do not have a purchase at end of lease provision in them, but I would be interested to see if you had any example at all of the ability to sell the car to someone other than the captive dealer written in any such contract.

You mentioned "GM / Honda perhaps others", so to corroborate that, the article that I linked to above which was from July, had the following list:

========================

"Currently, CarMax cannot purchase a vehicle leased through the following companies: Nissan Motor Acceptance, Infiniti Financial Services, Honda Finance, Southeast Toyota Financial, GM Financial, Ford Credit, and Mazda Credit," says Unice.

=======================

There may or may not be others added to that list as of now (my money is on "may", since Tesla is now on that list). We are not looking at the contract (and tesla has a history of flying loose with some stuff) but those above companies dont, so I am sure they dont have such language in there or they wouldnt do it.

The TL ; DR version would be, "I would not expect anyone to "lawyer up" and expect to force tesla or anyone else to allow them to sell their leased car in any sort of expedited fashion.

 

[CapeOne]

I know you have a lot of knowledge in this area, but have you ever seen a lease contract that specifically spells out specific options for selling the vehicle? My BMW lease ( for example) had specific provisions on how I could turn the car back in, and how I could purchase it myself, but there are no provisions on whether I can sell it to a mercedes dealer (or any other non BMW dealer), for example.

Tesla leases do not have a purchase at end of lease provision in them, but I would be interested to see if you had any example at all of the ability to sell the car to someone other than the captive dealer written in any such contract.

Typical contract lease end options specify returning the car or buying it. The “buying” part has usually been somewhat flexible in that it includes lessee buying vehicle (possibly even at a negotiated lower price – although not in the current environment) as well as allowing a third party dealer to buy it directly which may be subject to state laws related to title transfer, sales tax, etc.

Whether or not someone is able buy at lease end or sell to a third party dealer will depend on the lease contract/agreement. Tesla lease agreements have given the option to purchase at lease end for MS and MX models (e.g., "You will have an option to purchase the vehicle at the scheduled end of the lease for $XX,XXX....") but I am not sure what the purchase option wording has been for M3 or MY models.

 

[Scrannel]

Tesla, of course, has only recently changed their mind on this. I received this Tesla email on the 7th.

Ownershiployalty​	Thu, Oct 7, 3:50 PM
to me

That is correct, 3rd party dealers are able to purchase out the vehicle but contacting Tesla finance at (844) 837 5285 OPT 1.

Best!

Now it seems to me the question in play would be, did you lease the car knowing this -- and were partly induced to lease -- because of this option? Would that have been a deal breaker? Hard to prove but just as hard to disprove. I'm not a lawyer and can't site case law. But, whether they own the car or not, maybe they can't just change a policy capriciously.

Apple a few years back had a sh!t-scandal with their "Error 53" where they just -- randomly -- decided that if you took your iPhone to an independent repair shop to have your screen replaced (eg) that the next time you updated Apple would wipe and brick your phone. The elephant in the room was Anti-trust laws, but part of Apple's reasoning was they were simply trying to provide a more secure software environment... by forcing owners to only use Apple repair. In the end Apple backed down (with class-action suits looming in the US and the EU) but one argument was that whether Apple had a legitimate reason or not, they couldn't change the buyer's expected user experience without notification. In other words, even if legit, it couldn't be retroactive.

 

[MP3Mike]

Now it seems to me the question in play would be, did you lease the car knowing this -- and were partly induced to lease -- because of this option? Would that have been a deal breaker? Hard to prove but just as hard to disprove. I'm not a lawyer and can't site case law. But, whether they own the car or not, maybe they can't just change a policy capriciously.

Even if the lease says that it can be bought by a third-party dealer does it specify the price? Maybe Tesla should just tell every dealer that inquires about buying out a lease that it costs $100k. That way they make good on offering the buy-out, but nobody would actually take them up on it.

 

[DiamondM]

It's not the same thing. The issue being discussed is that Tesla changed the terms (lease end options) after the lease was signed. Instead of a choice of turning the car in or selling to a third party dealer, the only option now is turning the car in.

When renting a car for the weekend, one of the "return options" would never have been going off and selling the car to a third party dealer

Tesla, of course, has only recently changed their mind on this. I received this Tesla email on the 7th.

Ownershiployalty​	Thu, Oct 7, 3:50 PM
to me

That is correct, 3rd party dealers are able to purchase out the vehicle but contacting Tesla finance at (844) 837 5285 OPT 1.

Best!

Now it seems to me the question in play would be, did you lease the car knowing this -- and were partly induced to lease -- because of this option? Would that have been a deal breaker? Hard to prove but just as hard to disprove. I'm not a lawyer and can't site case law. But, whether they own the car or not, maybe they can't just change a policy capriciously.

Apple a few years back had a sh!t-scandal with their "Error 53" where they just -- randomly -- decided that if you took your iPhone to an independent repair shop to have your screen replaced (eg) that the next time you updated Apple would wipe and brick your phone. The elephant in the room was Anti-trust laws, but part of Apple's reasoning was they were simply trying to provide a more secure software environment... by forcing owners to only use Apple repair. In the end Apple backed down (with class-action suits looming in the US and the EU) but one argument was that whether Apple had a legitimate reason or not, they couldn't change the buyer's expected user experience without notification. In other words, even if legit, it couldn't be retroactive.

Exactly. I specifically asked this question prior to leasing because I wanted to test the product.
I recently ordered a dual motor instead of an SR+ to upgrade and now they screwed me.
Ive also asked for my money back for my reservation due to this policy change as now I cannot
take delivery of my new car. Lots of people in this same situation. I know of 3 personally who all placed
new orders now have to either find someone to take over their leases or they are stuck. Bad business move

 

[jjrandorin]

Exactly. I specifically asked this question prior to leasing because I wanted to test the product.
I recently ordered a dual motor instead of an SR+ to upgrade and now they screwed me.
Ive also asked for my money back for my reservation due to this policy change as now I cannot
take delivery of my new car. Lots of people in this same situation. I know of 3 personally who all placed
new orders now have to either find someone to take over their leases or they are stuck. Bad business move

When you find a lawyer to take this case up for you, keep us in formed how that goes. Maybe there is a lawyer somewhere going after all the other manufacturers doing this that would be willing to help you with this?

 

[Scrannel]

None of the arguments against Apple were directly tested as Apple backed down. But there has to be some pertinent case law somewhere.

 

[jjrandorin]

None of the arguments against Apple were directly tested as Apple backed down. But there has to be some pertinent case law somewhere.

Im still having a hard time with the apple situation which is sort of "right to repair" for people who OWNED their phones, being a correlation with people who are renting something having a legal right to sell it someplace the owner of said thing doesnt want to sell it to.

Absent a specific, contracted right to sell (or buy), I dont see how this is anything other than "I dont like it". from people leasing. These leases didnt even have a contracted right for the person leasing to buy the vehicle at lease end, so they are even more restrictive than "regular" leases, contractually.

Given that this is Tesla, and there are plenty of people who love to pile on Tesla, if this is legally possible, someone will do it. I doubt it is, myself, but am certainly no expert here.

 

[CapeOne]

When you find a lawyer to take this case up for you, keep us in formed how that goes. Maybe there is a lawyer somewhere going after all the other manufacturers doing this that would be willing to help you with this?

The situation with other manufacturers is slightly different in that they're not necessarily preventing lessees from buying the car and then turning around and selling it to another dealer or private party, they're preventing the car from being sold directly (which may not be allowed in some states anyway due to title transfer, sales tax, etc. laws) to another dealer or private party.

Bottom line still is that it depends on how the lease end options are written in the contract. I know what MS and MX lease contracts have said, can anyone share what M3 or MY lease contracts state? That will be key in determining what, if any, legal action is feasible.

 

[DiamondM]

 

[CapeOne]

[[lease contract]]

I’m not sure what #26 would've had or what #33 states (it's missing/cut off) but I am not seeing any section regarding purchase options. A lease would typically have a section on purchase options, including buying at lease end, buying out the lease early, what those costs would be, etc.

Is there anything relevant above #26? It may be that Tesla hasn't been putting purchase options in writing for the M3 or MY lease contracts. That's not the industry norm but not allowing lessees to buy cars at lease end (which is how Tesla handles M3 and MY leases) is not the norm either. You, and other M3 and MY lessees, may be out of luck here.

 

[MrFusion]

The Tesla lease contract clearly states that there is no option to purchase the vehicle. So I don’t think anybody has a case against Tesla. They specifically said that you can’t buy it. I know they have allowed dealers to buy it in the past but that is technically not required of them. Per the terms of the lease you have to keep it for the whole lease and pay all the payments.

 

[DiamondM]

Well changing those terms and not allowing people to do it when they clearly asked if this was part of the process and available to them prior to leasing the vehicle seems unethical.
If they are going to change the process of what they allow and don’t allow it should be on the contract is my opinion. I’ve sent the contract to an attorney for review. Will advise on his thoughts

 

[Kairide]

Guys get over it; GM, Honda, Toyota and some other car manufacturers also changed their lease terms to not allow sales of leased vehicles to other car dealerships due to the inventory shortage.
They don't always need to spell out every little single thing. Similar to how airlines have their terms of carriage which are vague and allow them to make changes when they want. If you buy an airline ticket, you're paying to get from point A to point B, but how you get there and how long it takes is up to the airline.
When you lease a vehicle, you don't own it therefore the manufacturer can decide how they want to handle the vehicle during the lease and at the end. You are agreeing to lease the vehicle for a certain amount for a certain amount of time. If the lease contract states you have the option to purchase the lease as an individual, then you can at any time. That can't be changed and none of the legacy brands have prevented individuals from purchasing their own leases.

Tesla clearly states that 3 and Y leases cannot be purchased. You would need to find a line in the lease contract that specifically states the lease can be sold to a third party dealership at anytime up to the end of the lease terms. Even if Tesla states it on their website, they can change that at any time, which they have. The information in the lease is what is a legally binding contract, not information published on a website. Hint, read the legal page on Tesla's website for all of their "outs". So whatever Joe Blow told you verbally during the lease talks means nothing. If it's not in writing in the lease contract, it means nothing. It's not worth wasting your time on, if it were, lawyers would already be lined up to sue the legacy automakers.