Tuesday, October 28, 2014

Tesla Announces a New Leasing Package for Its Electric Cars

The Tesla Model S. Tesla announced over the weekend that drivers who take out Model S leases have a three-month trial period during which they can return the car. CreditTesla Motors

Tesla Motors has unveiled a new package of lease offers for its Model S all-electric sedan, including a three-month return policy.

Elon Musk, Tesla’s chief executive, said in a statement posted on the company’s website over the weekend that drivers who take out Model S leases have a three-month trial period during which they can return the car.

“If you don’t like our car for any reason in the first three months, you can just return it and your remaining lease obligation is waived,” Mr. Musk said.

The deal is not without its limits, however. Drivers cannot use the deal to immediately lease a different Model S, though Mr. Musk said buyers looking to upgrade early can do so with a “pass-through fee” to cover the difference between the used value of the current Tesla and the new one.

The automaker also announced an arrangement with U.S. Bank to begin offering Tesla leases for less than the company itself currently provides. Mr. Musk estimated the leases through U.S. Bank could be up to 25 percent cheaper, because of the bank’s lower cost of capital.

Currently, Tesla offers leases on the Model S that start at around $800 a month, and top out at close to $1,300 a month for the highest-performance model. The down payments to achieve those rates range from about $6,500 to $7,000.

Alexis Georgeson, a spokeswoman for Tesla, said the new lease deal was something the company had been “working on for quite a while,” and was not a response to the company’s sales performance, which Ms. Georgeson said continued to be favorable.

“Demand remains extremely strong for the cars,” she said.

She declined to provide detailed sales figures, citing Tesla’s policy of not releasing monthly sales numbers, but said the company planned to provide updated information on total deliveries in conjunction with its earnings announcement next week.

Tesla will announce its third-quarter earnings on Nov. 5, after the markets close.

Because Tesla, based in Palo Alto, Calif., does not reveal detailed sales data to the extent that other automakers do, estimates calculated by industry-tracking firms can vary. According to Autodata Corporation, Tesla’s September sales were down 15 percent compared to the previous year, with year-to-date sales dropping 3 percent. Wards Auto estimated that Tesla’s September sales were down 11 percent, with year-to-date sales down 26 percent.

Tesla introduced an all-wheel-drive version of its Model S this month. Versions of the car feature semiautonomous driving capabilities that offer hands-off-the-wheel, foot-of-the-pedals highway driving.

Tesla stock has experienced a meteoric rise since the beginning of 2013, when it traded for about $35 a share. Since the start of this year, the company’s stock is up nearly 50 percent, but it has been on a largely downward trajectory over the last two months. It closed at $221.67 on Monday, off more than 5 percent.

Source:- http://goo.gl/HNfMsk

Sandeep Sharma

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