You aren't qualified for the $7,500 federal tax credit if you lease a vehicle, only if you buy. For many first-time EV owners, buying is a big leap of faith. It's a new technology and no one knows for sure where battery tech will be in 10 years. Many drivers would prefer to lease but don't get the tax benefits of purchasing, so instead they decide to stay on the fence.
Tesla just pushed them off the fence.
Coloring shades of grey into our tax laws...
The current rule is that only the first sale or lease of a car generates a tax credit; in the case of a lease, the leasing company takes the credit (see http://www.fueleconomy.gov/feg/taxevb.shtml , under "Requirements").
Somewhere between tax fraud and the current rule are some legitimate scenarios we probably do want to encourage (like buying a few-year-old electric vehicle instead of a new one, or the same electric vehicle getting leased out multiple times), but these scenarios are:
1) Harder to monitor
2) Too long-term to be compatible with the short-term nature of these tax cuts, and government budgeting in general.
1) It shows consumers that their gov't is supporting this. That's good for citizens to be aware of, regardless of whether you think this credit is a good or bad thing.
2) Ideally, it shouldn't matter but I don't trust car salesman to give consumers the best part of any deal. Consumers are generally not equal negotiators and I suspect sales people will pocket more of the tax incentive.
They can say the car is discounted to include the incentive but they may not apply the entire incentive to the discount. The more complicated a deal is, the less likely a consumer is going to get the better end of that deal.
That may be fine if you're favoring a completely free market but I prefer to side with consumers and favor protection when possible.
The residual value guarantee is pretty good though.
usually there is a separate entity that finances or leases the cars sold at the dealership, such as mbfs for mercedes benz financial services, gmac for general motors (defunct) etc
for tesla to offer the rebate directly they would have to setup a revenue split from the finance back end, or take a hit on the sales revenue, which is either difficult to get out of a bank, and not in the interest of tesla, respectively.
Elon Musk is great. He's always all-in.
Then to top it off, all with my money too boot! So for everyone who can afford a one thousand dollar monthly lease; before taxes; they get my help to pay for it.
Sorry, he is all in with our help. That isn't exactly courageous. He wants to capitalize on that tax credit before the money ends up elsewhere.
Look, I am all for having an electric car do well, but I would much rather finance the world of Leafs and similar affordable cars than a luxury vehicle to people who could make the payment regardless. People on sites like this bitch up a storm all the time about subsidies to various businesses but somehow this one gets a pass.
To that end, even though the current state of Tesla and Model S may not be picture perfect, its success is certainly more desirable than its failure, particularly given that both its Nissan and GM counterparts have basically flopped in people's minds.
Nissan Leaf, average owner income: $125,000
Chevy Volt, average owner income: $175,000
From an environmental standpoint it's going to lead to a greater reduction in fossil fuel use in the aggregate, assuming it sees the same pattern of takeup as the Prius did.
Europe has much higher costs of gasoline than the USA. They still don't have roads full of electric cars.
yet. Government subsidizes 100% electrical cars heavily in the form of low / no road taxes or lease tax, and with a high amount of <100 km commuter traffic, electrical cars with their limited range make sense.
For example: Will you tax diesel as well? If not, then people will switch to that, with poor results for our air quality.
If yes, then suddenly every since thing you buy will be more expensive, since it's all shipped.
And those are just the first two things that popped into mind - there will be a LOT more consequences.
Also shipping is starting to switch to natural gas; you may think this a good or a bad thing, but a tax on diesel would increase that.
You can discriminate between uses in a way similar to this: http://en.wikipedia.org/wiki/Red_diesel#reddiesel
Here Elon speaks at TED. Somewhere in the talk he explains the reasoning behind the more expensive vehicles at this moment. (spoiler: He plans on getting less expensive, less elegant versions on the market, with the help of these more expensive versions.)
Not only is this story a great business and strategic move, it has an added bonus of marketing/PR/goodwill + hiring benefits.
There's probably a lot we can all learn from the kind of decisions/announcements that are continuously being made from Elon Musk and Tesla.
On the minus side, the initial values in the calculator are heavily shaded towards Tesla. Who spends 15 minutes at a gas stop? Using the average cost for electricity instead of the marginal cost?
Try making the cost of gas low, and electricity high, and the "savings per month" simply drops to 0 and stays there, instead of wrapping around and becoming a cost.
Yeah it's an estimate, but it doesn't cover any of the basic possibilities.
The fact that they shaded the initial number in order to close the sale is deceiving, and honestly, surprising from a company I previously held in high esteem.
It's not that this practice is uncommon, it's that I wouldn't expect it from Tesla.
* Going from the $10k CA incentive to the $7.5k other states one changes the monthly from -80 to -11? Is the incentive sunsetting or something?
* The default settings assume you are using it for business and can deduct the cost. Just unchecking that makes it significantly more $$$.
* The gas savings assumes your gas car gets only 19 mpg and requires $5 gas.
Having a $222 business tax discount selected by default seems questionable to me though.
It is really interesting to see balloon/option loans coming back, but for a different reason.
As far as I know, no bank does leases and only the captives do them. In this case, you owe wells fargo for the full amount of the loan, but Tesla and Musk are personally guaranteeing to buy the car back. A clever way to create a lease product backed by a company that won't do leases.
But this article is really light on details:
1) Is put option available without the loan?
2) Is it available for longer than 36-month period?
If I decide to buy Tesla, it's unlikely I'm going to be replacing it in 3 years, more like 6-8 years. And I think that there is a good change that in 6 years resale value will be 0 - with more advanced battery tech available and with cheaper models around, and with old battery Model S may turn out to have no value in 6 years. So this kinda stops me from considering it.
They did bet that resale value will be higher than certain amount. Moreover, if it's higher, than what stops you from selling yourself and just returning the loan? I.e. it seems that they are not going to benefit from upside, but will suffer from downside - if resale value is lower, all people having this option will execute it.
On other hand if enough buyers will buy this option, this will effectively set the market price of the used car (as lease does for 3yo BMWs, for example).
Anyway, it seems they punish current cash buyers if this option is not available for them.
I do not consider significant reliance on the state for funding the mark of a great entrepreneur. Musk has a bold vision, and the tenacity to execute on it, and that is commendable. But not without significant aid.
I think maybe your bar is set too high.
"48 companies that have received more than $100 million in state grants since 2007."
In U.S. budget-ese, you describe costs over a 10 year span, so that's a "$5 trillon tax hike".
The point being that the EV subsidy is small potatoes. I still think it's a bad idea. Tax the gas. Let producers and consumers figure out how to use less, and let governments figure out how to compensate for the regressiveness of the tax.
EDIT: Also, you can't just give it all back. As long as emissions continue at something near current levels, you have to spend it on amelioration. It doesn't just become a slush fund.
I'd say as much of it as we can, equally per-capita.
> Some poor people drive a lot.
And either they will change their behavior, or be hurt less than if we didn't give the money back. As people generally change their behavior they will likely have more options, as demand rises for alternative modes of transportation (and for goods and services that involve burning less gas) leading to greater economies of scale.
> Some poor people don't drive at all.
But they still buy goods that were shipped by burning gas. Even so, they'll benefit more than others, but I don't think that's a problem.
> Also, you can't just give it all back. As long as emissions continue at something near current levels, you have to spend it on amelioration. It doesn't just become a slush fund.
We can certainly talk about taking a piece for amelioration, but I don't think paying that out of the general fund is unrealistic; it's what we'd be doing otherwise, and it'll be way cheaper if people have adjusted their behavior to reflect the true costs of their actions.
The very worst case, of course, is any who find themselves paying higher prices but unable for whatever reason to access the stipend.
Transporting stuff doesn't need to use all that much oil. Neither does growing.
Governments are the source of all wealth.
Subsidies, tax breaks, issuing debts, give aways (pork), purchases, loans, war profiteering, patents, etc.
Government even protects people's property rights.
Without governments, there is no wealth.
Personally, I'm quite proud that the US Govt is funding alternate energy, electric transportation, and space exploration. Many of the past investments have worked out quite well. I'm bullish about these investments too.
I have to disagree on that. Governments are the arbiter of most wealth, via taxation, subsidies, spending, the court system, etc. "Wealth" comes from production, transformation, and trade. I've taken a tree and nurtured it so that it produces fruit. The world is now one fruit-producing tree wealthier. I trade fruit with my neighbor for wool, because I value some quantity of wool higher than I value some quantity of fruit, and my neighbor values the fruit more than the wool. We are now each wealthier for trading something we have in excess for something we do not have.
The government then takes some of my fruit to feed the soldiers defending my land. Government's role in the economy is mandatory trade for the benefit of the society as a whole. I must provide fruit to the soldiers whether I want to or not. Sometimes there is a net gain through these trades (see space exploration, for example). Other times the gain from this trade is disputed (see California's high speed rail project).
Our government distributes enough risk to me already, while letting the pseudo entrepreneurs keep all the upside. That's the reason all those credit default swaps made by Goldman Sachs and others were paid for by the taxpayer.
Tesla is a recipient of government subsidy, but you pretty much have to operate in the auto market. Everybody else (big auto companies, big oil) are the recipients of massive subsidies too.
So if Tesla fails, then the "personal guarantee" simply turns into SpaceX shares. And SpaceX is a pre-IPO company.
The banks are providing: 1) cash 2) loan origination and servicing.
Tesla doesn't have a cool $1B in cash laying around to make 15,000 car loans. The banks do as they lend from customer deposits. Tesla needs the cash immediately to buy more parts / pay employees.
Also, Tesla doesn't have a team of people that know how to review and check credit. Nor do they have call centers to remind people to make their payments, and if they can't arrange a repossession.
>Tesla doesn't have a cool $1B in cash laying around to make 15,000 car loans.
Tesla doesn't need the cash in reserve to make loans to buy Tesla cars; such a "loan" in that case would simply mean "not requiring (immediate) payment". It certainly means forgoing some liquidity, but that's not the same as them having to come up with the purchase price for all their cars; they're paying themselves anyway.
That is a powerful privilege and the reason why it is smart to partner with a bank, even if you have money to spare.
No. Only central banks can create money by printing it.
An ordinary bank (commercial, S&L, or credit union) cannot loan out more money than they take in. That's why it's called "fractional reserve" banking -- i.e., a "fraction" of deposits is not loaned out, but is instead held in reserve.
The 10-fold expansion of the money supply is caused by the multiplier effect, not by banks printing money. The only way to avoid that is for the bank to make no loans at all. Any fraction -- whether 1/10 or 9/10 -- will still lead to a multiplier effect. It's just a matter of how large you want the multiple to be.
Musk is betting that the car will be so good that people will want to keep it.
If it's true, then buyers are getting a great deal and Tesla wins with a lot of cars on the market, and in turn, a lot of leverage to get their charging stations all over the place.
If it's not true, then it all goes to hell over a year period where people are returning them and Tesla is buying them back.
Musk is basically saying "there is nothing better than a Tesla, and I am willing to bet the farm on it."
Or that Tesla can sell "certified pre-owned" models for > the cost of the buyback.
It's not just a hedge against you ending up with a dud car either: you're also protected from a perfectly adequate '13 model's value being driven down by a new generation of Teslas which are drastically better (or better value). That's a worthwhile guarantee for the early-adopter of a physical product in a rapidly evolving market
Expect the most dramatic innovations from Tesla to come in 2017 and beyond then... :-)
Also as another HNer remarked, don't forget there is probably a second hand market.
Admittedly, it ends up being a lot more if you don't live in California, drive a car that gets a more reasonable MPG, etc. Whether it will turn people away or lead people to doing the research themselves remains to be seen.
the same residual value percentage as the iconic
Mercedes S Class, one of the finest premium sedans
in the world
Lamborghini, Aston Martin, and Maserati fall into the same bucket on the sporty/sports GT car side of the fence. If you want great resale value, you buy a Lexus ES -- on account of everyone wants a quiet, boring, comfortable, reliable (parts-bin to a large extent) mid-size sedan that they too can afford to repair, insure and keep running.
Incidentally, Maserati used to be owned by Ferrari, although now I think it is owned by Fiat
In 1993, Fiat acquired Maserati from De Tomaso, but a 50% stake was sold to Ferrari in 1997 -- however, at the time, Ferrari had already been under Fiat's umbrella as a sister brand (since 1969).
Edit: Based on DanielStraight/Tesla's numbers below (43% RV) that'd be a residual value of $31420 on the base model, with a penalty of $0.25 on each mile over 36k.
Tesla's True Cost of Ownership page has more:
The guaranteed resale value is 43% and there's a penalty of $0.25 per mile for each mile over 36000 (58000 km).
The main advantage of a traditional lease is an extremely low monthly payment: the lessee only pays for the depreciation on the car plus interest on the entire purchase price.
Tesla's product does not offer this, because it's simply a five year loan. Rather than for paying for 40% of the car over three years, you pay 100% over five, so the monthly payment will be roughly 50% more than with a real lease.
Why can't Tesla offer a real lease? Because no bank wants the risk on fundamentally new type of car. Normal leases are financed by banks with the car as collateral at the end of three years; this allows the bank to take the risk of much lower principal repayments over the first 36 months. Usually the car's residual is struck low enough to make this a good deal for the bank. However, banks balked at taking the Tesla Model S as collateral, because there's extreme uncertainty about how valuable these cars will be in three years--for example, if there's a breakthrough in battery technology, or if the batteries themselves don't last very long, or the car proves unreliable for other reasons, the final collateral could be worth much less than estimated.
Ideally Tesla would sell the cars to themselves, claim the $7500 tax credit themselves, and pass the savings onto the lessees via lower lease rates, essentially acting as their own bank (many car companies do this, like Nissan with their LEAF and Ford with the Focus Electric). However, Tesla doesn't have the cash or assets to do that. They need to put all of their cash into operations and can't loan it out, and they don't have enough profit for them to take advantage of the tax credit.
So who takes the risk? The customers. They must make 1.5x higher monthly payments even if they plan to sell the car back, and they're taking a risk that Tesla (or Elon) will be around in three years to honor the buyback price. Furthermore, customers cannot sell the car or the guarantee is lost; it's not transferable to a new owner. Tesla is gambling that they'll have the cash to honor the buyback prices even if the car turns out to have massively depreciated. If the car depreciates massively, Tesla may not be around anyway, so it's a good risk for the company. Likely the residual value is struck low enough (~45%) that they can probably resell the cars without a loss in the expected case, even though that number is still too risky for banks to go for.
Kudos to Elon for personally guaranteeing the resale value; that takes some cojones.
Last time I check, no banks did leases. Only the captive finance companies do leases. e.g. Ford Credit / Toyota Credit / GMAC / etc.
This type of financing has been done many times before, but for a different reason. New York and New Jersey have vicarious liability laws which means if the car damages your property, you can sue the owner of the vehicle. In a lease, the credit company has title of the vehicle, thus for a period, no leases were done in certain states, and they just did this same "guaranteed resale/baloon payment" loan.
- The bank has to place a bet on the value of the car 36 months from now--a huge risk. With a loan, they only have to bet on the credit-worthiness of the borrower, and they can ask for additional collateral, if they wish.
- In case of a lease default, there is no equity in the car, because lessors, by definition, only pay for depreciation. On a loan default, there is usually at least some equity in the car.
- Usually the down-payment is less for a lease than for a loan (Tesla's program requires 10% down, almost unheard of for a lease).
All of these factors taken together mean that the bank is much less likely to take a bath on a loan than a lease.
As I understand it, the down payment is roughly offset by the tax credit, so the experience of the buyer/lessee is similar to a normal car loan.
Parts are a little surprising (e.g. it assumes your time is worth $100/hour).
Even with the extremely optimistic numbers Tesla comes up with, this was still a luxury; without them, it's a luxury I'd be embarrassed about.
Kinda funky numbers for sure, but it is basically marketing. This is as honest as any car commercial.
If you're talking about the car owner's time, then perhaps, but given the price of the car, it's likely that whoever is buying it makes close to $100/hr (or possibly when combined with their financial partner).
30k miles/yr driven. ~20k in the Bay Area, ~10k on road trips (where Superchargers would be nice)
$5 gas, $0 electricity cost (assume charging at work)
60 minutes/day savings on commute, which is the big thing. Most of the East Bay is HOV-3, and with 2 people in the car, still no HOV access. It easily would save 20-30 minutes twice a day. On 101/237, I'm usually 1 person when I want HOV-2 access. Opening up 5-9am and 3-7pm everyday with time savings would be a huge plus.
The cheaper solution to this is to get a 2-seat gasoline car or a Leaf, though. The even faster solution is a motorcycle, but factoring in risk of death/injury on a motorcycle in rush hour on 580/80/101 and it's not worth it.
I also agree that it's non-sensical to pitch this as a $500 car. The numbers required by their calculator to reach that level are absurd. For example, a 535i gets 20/24/30 mpg (city/combined/hwy). Tesla's calculator starts at 19 MPH. That's silly.
And the Tesla calculation completely ignores the other side of the ledger: the time spent plugging and unplugging your car. Even if it only takes 30 seconds to plug it in and 30 seconds to unplug it, that adds up to half an hour per month, not much different than the time spent going to the gas station.
That results in "ridiculous numbers"
in Tesla's latest financial claims.
[..] a number of components are currently obtained from single or limited sources, which subjects the Company to significant supply and pricing risks.
Many components [..] are at times subject to industry-wide shortages and significant commodity pricing fluctuations
A significant concentration of this manufacturing is currently performed by a small number of outsourcing partners, often in single locations. Certain of these outsourcing partners are the sole-sourced suppliers of components and manufacturers for many of the Company’s products.
[..] the Company must make significant investments in research and development. [..] In contrast, many of the Company’s competitors seek to compete primarily through aggressive pricing and very low cost structures
Due to the highly volatile and competitive nature of the industries in which the Company competes, the Company must continually introduce new products, services and technologies, enhance existing products and services, and effectively stimulate customer demand for new and upgraded products.
Substantially all of the Company’s manufacturing is performed in whole or in part by a few outsourcing partners located primarily in Asia.
Many of the Company’s products include third-party intellectual property, which requires licenses from those third parties. [..] There is, however, no assurance that the necessary licenses can be obtained on acceptable terms or at all.
Thats Apple. There are a bunch more of these, too.
Tesla can't self sponsor leases because they don't have the cash and might not be able to cash in the full credit (since they haven't been making good profits).
This provides the customer a lease like situation given the above.
Apparently, Wall St agrees with me, as the stock is down 8% today as I type this.
They're not reasoned documents, they're a picture of the absolute worst-case scenario.
Start with Elon Musk personally backing the repurchase agreement. Was the bank unwilling to to take this risk? Why could they believe they can't securitise the risk? Granted this is U.S. Bancorp and Wells Fargo we're talking about. Will the risk live on Tesla's balance sheet? The silver lining would be the clarity investors will get into the assumptions that went into pricing the put.
Why we are already talking about financing? Wasn't the plan to improve accessibility by driving down prices through increasingly mass market models? Who is the marginal customer who balked at the cash price but is shifted by this? The one who doesn't have the cash? Or couldn't get a bank loan? These customers are probably less credit-worthy than Tesla's cash customers. The repurchase agreement is a callable loan to borrowers willing to fund a large discretionary purchase with debt. This will come home to roost if U.S. growth and thus incomes tank and erstwhile enthusiastic greenies start seeing their vroom vrooms as piggie banks.
We know that part of what pushed Tesla into profitability was its re-working of its DoE loan. Is this a way to pull forward sales? How are these "leases" accounted for when they're made? I'm keeping an eye open for if they recognise the full value of the sale, less an ignomiously small loss reserve, upon signing.
Comparatively minor but still irking me: why is Elon Musk implying his credit is better than Tesla's? Tesla has more loss-absorbing capital. Given the amount of Musk's net worth tied up in Tesla, his credit has a high correlation with Tesla's. I get that this is more a marketing stunt, but the emptiness is disappointing. Then again, I would have probably railed at Steve Jobs in 1998, too.
Put it this way: Portugese Insurance Group (PIG) sells you an annuity that it promises to repurchase should the market crash. You find out PIG would go broke if it had to repurchase even 1% of outstanding annuities. "No worries," the broker assures you, "we really believe in this product. You will never have to take up the option."
The guaranteed buyback is the special sauce here. So I'd want to see exactly what's involved. Are there lease type conditions on miles driven? Exorbitant charges for minor damage? The small print is rather important.
As for lining up banks to agree to financing subject to approved credit, it's fairly meaningless. Someone will always lend you money subject to approved credit.
The loan is a normal car loan with 10% down (in fact you may be able to get a better rate with a CU instead of US Bank / Wells Fargo at around 3%).
The residual on a S Class is actually on the lower end for luxury cars (~40% ish). So the risk in the buy-back option is minimal for Tesla.
Since the Model S is still relatively small in production numbers, it will likely have a much higher residual value (I'm guessing over 60% after 3 years) unless something goes horribly wrong.
It also doesn't combine the "best aspects" of leasing and buying. They show a $284 deduction for business use, which probably assumes 100% business usage.
If I were to do the same with a lease, I could write off 100% of my lease payments... but the lease vs. buy benefit certainly depends on your business situation and usage.
What I would like to see is a real lease that could compete with BMW/Audi. Good lease offers are typically a result of cars with high residuals (like reliable Hondas or brands like BMW/Audi). You wouldn't get the $7500 tax credit with the lease, but I believe the manufacturer might get it themselves and I've seen these incentives passed down to the consumer even in leases.
Maybe we'll see it in after the car has been on the market for a few years, but by that time those big tax credits will probably be gone.
Seems like this whole scheme will unravel as soon as those tax credits die out, which they will.
I've seen some people saying that these subsidies are unfair, but the US government heavily subsidizes gas too.
Some very rough calculations put the average gas subsidies paid by the US government around $4350 per driver per year.
I dislike subsidies in general, but it's too bad the credit will phase out sooner rather than later. Getting plug-in electrics on the road will save the US tons of money on gas subsidies.
1.49 gallons/driver/day * 365 days * $8/gallon subsidy = $4350.8/driver/year
Using an $8 subsidy based on some quick googling, which places the true cost of gas in the US from $12-$15/gallon. Assuming an average price of $4/gallon, that puts a conservative estimate of the subsidy per gallon around $8.
Federal credit phase out info: http://www.irs.gov/Businesses/Plug-In-Electric-Vehicle-Credi...
This article at $12.75 from May 2011:
Subtracting the $4 price of gas is what brought me to $8, conservatively. To be fair, some of the price paid at the pump is tax, but according to the previously linked wikipedia article that's 12%, so $0.48 for a $4 gallon.
Presumably Musk is anticipating that most buyers will like the Model S enough to not sell it back; if reality lines up, Tesla comes out far ahead. If not, they're doomed, but this scheme would really only be accelerating their demise in that case.
Especially if the battery pack needs replacing after 8-10 years, it seems like it would be worth upgrading it at 6+ years with a 30% better-than-new pack, assuming technology has improved by then.
A wise investment considering the alternative products. A 43% resale value buyback isn't too shabby, but my guess is the model S would be worth more than that in 5 years.
Quite the start to April for Tesla.
If you look at Tesla's ambitions - to start at the high end, experiment there then bring the innovations to the broader market - this could prove to be a much bigger change than it appears. Plus, lease-type mechanisms like this can lead to a significant greening of the auto industry over time if such arrangements take hold.
"We changed the name of a lease, so people leasing a 1500/month car can get a free $7000"
Also "we can say a $1500 lease only costs $500, because marketing and stuff"
They are trying very hard to position Tesla away from the Rich and Famous market segment. This new financing program isn't so much intended to increase sales of the Model S (which is oversubscribed IIRC) as it is to work out the kinks for the lower-end cars coming in a couple of years. And expand the market of people who can and should be considering Tesla vehicles.
(Side question: Since a leased car is actually owned by a bank or leasing entity, do they get the credit?)
Increasing sales makes the company better able to produce electric cars for the market, which I argue is the ultimate reason the government created the program. I don't see this financing option as screwing anyone any more so than a normal purchase that takes advantage of the tax.
That said, the first month before the charge station was installed we could only charge 5 miles per hour with a regular wall outlet(we hardly drove the car). Finding someone to intall a charger and getting the approval of the HOA was a huge hassel (and we're in San Francisco). The cost of the charger / installation was 2500!
The right side of that trade is to be the -buyer- of a 3-4 y/o MBZ. If you appreciate great cars but don't care about the vanity of having the very newest model to show off, that age is a sweet spot where the first owner has already paid for about 2/3 of the car yet used only about 1/4 of its lifetime utility.
I've never bought or leased a car, and I'm wondering how this compares to the terms normally offered.
So saying "for the same residual value percentage as the iconic Mercedes S Class, one of the finest premium sedans in the world" is honest but kind of deceptive. You'd much rather have the same residual value percentage as the much less expensive Jeep Wrangler.
This is basically a lease, phrased as a sale with the option to sell back, to take advantage of incentives that governments give to buyers but not lessees of electric cars. A nice option, but hardly worthy of the breathless marketing hype.
The way to "hack" this is to either stop going to the dealer after your luxury car goes out of warranty and find an independent mechanic or work on your car yourself. Both have their own drawbacks, but it's generally what you see most long term luxury car owners doing.
The other thing is that I thought they couldn't make these fast enough as is? Why do they need a financing product like this to get people into the cars?
I think the Tesla's value is more likely to follow a 911 Turbo or another sports car like that vs. a luxury car.
Being able to refinance at 36months with a 5 year used car loan at ~5% would be pretty nice, though.
I think that might be the first time I have actually used in-browser zoom for something.
What makes a luxury vehicle substantively different from a small car, if anything, you would get less benefit from the depreciation on a luxury car, because they tend to be worth more used. Also, a Luxury Car, and a top of the like 3/4 ton truck are in the same price range. Also, it is for example quite legitimate to outfit your outside sales people with a nice high end vehicle, they need to drive what their customers would expect them to.