Tesla Lease Details: Almost Complicated Enough to Require A Slide Rule
Tesla, along with partner Wells Fargo and US Bank, has announced a “revolutionary” new leasing program for the Model S designed to make the vehicle more affordable. Tesla has also launched a new online calculator to show you the “true cost of ownership.”
Tesla has partnered with Wells Fargo and US Bank to offer down payment financing based on the tax credit you would receive for purchasing an electric car. If you would be eligible for a $15,000 tax credit (both Federal and State) from West Virginia, for example, the bank will loan you the money and take the tax credit as payment when it arrives. Many people purchasing a Tesla could be doing so with zero money out of pocket for the down payment.
The other unique feature of this lease is that when the lease is up, you have the option to purchase or turn in the vehicle, like any other lease. But if you do decide to purchase the vehicle, you will continue to make the monthly payment that you are making now on the car until it is paid off. There is no balloon residual payment to pay to buy out the vehicle. Likewise, if you decide to turn in the vehicle, the vehicle’s residual value will be determined based on what a Mercedes-Benz S-Class is at the same time. By attaching the value of the Tesla Model S to the value of the Mercedes-Benz flagship vehicle, they are claiming that their vehicles will hold value well and should be a good investment.
Along with showing you the lease payment, you can select other factors (such as availability to drive in the carpool lane) to be factored into a “true cost of ownership.” If driving in the carpool lane would save you one hour a day of commuting, then that number is factored into the lease payment calculator. For some people, the “true cost” could be next to nothing based on the $100/hr value that Tesla places on your time. Of course, you cannot take that to the bank and use it for your payment!
When consumer confidence is down on a major brand or model, the manufacturer will often attempt to artificially inflate the value of the vehicle by offering high residuals on leasing. That can wreak havoc on the second-hand car market, but with the Tesla Model S being so new, this approach could be a very successful way to bring people into the brand, and make the vehicle more affordable.