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Discussion in 'Model S' started by janandji, Jun 6, 2012.
Does anyone know about the lease options and financing for Tesla S?
Elon Musk - No Leasing Program From Tesla in First 12 Months
I attended the 2012 Annual Meeting of Shareholders on June 6th.
During shareholder Q&A, I asked Elon about leasing.
I introduced and explained:
1. I'm a private investor, Model S and X reservationist, and I own a small business that happens to be located in Fremont, CA of all places.
2. My wife is not happy with all the hours I've been spending reading the Tesla Motors Club forum since I reserved my S last summer. [laughter]
3. We normally lease our business vehicles for tax reasons.
4. Your competitors all lease a very significant percentage of their vehicles.
5. You need to move 20,000 Model S units next year.
6. When do you plan to offer a leasing program?
Elon gave a long answer which you can see on the recorded video webcast of the meeting. (My question is the next-to-last-one so it will be near the end of the recording.)
Basically, Elon said: (from memory)
1. We think we can "sell" cars to the earlier reservation holders, so won't need a leasing program for awhile.
2. We will definitely have a US leasing program by Q1 of calendar year 2013.
3. We may even start the leasing program by the end of this year.
4. I know a lot about leasing because I helped start and am the Chairman of Solar City, the country's largest solar installer, and most solar systems are leased.
5. I believe that a higher percentage of Tesla electric cars will be leased than ICE vehicles.
6. With leasing, you will really see the lower cost of ownership: e.g. monthly lease payment + cost of electricity will be much less than ICE lease payment + cost of gas. Electricity costs about 1/10th as much as fossil fuels.
When the TSLA microphone guy retrieved the mic from me, he said: "Great question."
Three cheers for Russ....great work on all the different threads. :biggrin:
I am on the fence about lease vs. purchase (the good news is my number is high enough to assure that I will have both options).
I have always thought that is Tesla could offer a lease on a base model 40 kWh for $5,000 down (oh look, we have all already made the down payment) and $500 per month, they would have people lined up out the doors of their showrooms to lease the car. Depending on residual value, this may or may not be possible.
Right now I spend about $350 a month of gas. I figure I will spend about $50 on electricity for my S (Cincinnati area electricity is cheap), so that will give me $300 a month is savings. I would essentials be leasing a Model S for the same monthly payment as leasing a Hyundai Sonata or Chevy Malibu. I would think that most people if asked the question "Would you rather drive a Tesla or a Hyundai" would choose the Tesla every time. If a $500 a month lease is possible, you could make that case.
I think it depends on how long you plan to keep the car. If it's 8+ years, buying makes sense but I don't know the exact numbers.
I would lease it, but since it won't happen till next year I am reluctant because by then I think I would have saved enough to purchase the car.
If you are spending $350 a month on fuel like I do you will probably blow through the 10,000 miles as year they allot you at those low payment leases. They easily go up $200 a month when you try to get 18,000 miles a year.
Yea, I would probably need 15K miles a year on a lease. Still a lease option in that price range would attract quite a few people.
Well you could start off with a lease and then purchase a used Model S that's heavily discounted from its original price, and you could easily come out ahead vs. ownership from the beginning. I honestly would probably opt for that option if leasing was available right away, and I think Tesla is aware of this. They really want to capitalize on people's impatience and the early-adopter mentality. Much less risk to lease such a car, especially when there's still a lot of uncertainty here.
I agree that makes sense logically. Esp. with potential battery technology and/or cost improvements. For this reason (and other reasons), I leased my Volt.
Leases require the setting of a fair residual value, which is hard to come by when there is little to base it on via experience. One school of thought was that the above would contribute to rapidly declining value for used EVs. Interestingly, a report just came out that stated that after one year, the Leaf and Volt retained 95% and 90%, respectively, of their post-tax credit value.
Thanks, NigelM and Bonnie. I enjoy covering these events as a service to my fellow Tesla enthusiasts who don't happen to live in Silicon Valley and/or have the time to attend.
BTW, the videocast of the TESLA 2012 Annual Meeting of Shareholders is now up on their site here:
Elon's response on leasing is at 50:20 into the video. He actually said "definitely leasing next year, maybe even later this year..."
I think to make leasing happen sooner rather than later, all of us that want to lease need to keep contacting our TSLA sales consultants and/or corporate asking about leasing.
I'm going to tell Troy Jones I am going to delay my Model S Perf 85Kwh until I can have one of the first leases. It really is much more tax advantageous for my business to do it this way, since it takes many years to depreciate a sedan. (non heavy SUV)