Tesla announces 'revolutionary' lease option for Model S starting at $1,050/month
04-02-13, 03:29 PM
#1
Tesla announces 'revolutionary' lease option for Model S starting at $1,050/month
Tesla announces 'revolutionary' lease option for Model S starting at $1,050/month
Just how "revolutionary" you think the just-announced lease option is for the Tesla Model S will depend on a lot of factors, like how much gas costs where you live and whether or not your current car drinks premium or not.
The promised "exciting" news from Tesla Motors is what the company calls a "revolutionary new finance product." It's not really a lease, but it is claimed to combine the "best aspects of car leasing and ownership." As with everything else, Tesla is going its own way here.
There are specific lease payment costs – $1,199 a month for the 85-kWh Model S, $1,421 for the 85-kWh Performance model and $1,051 for the 60-kWh version – but Tesla is putting up invisible asterisks all over the place. Instead of highlighting those numbers, Tesla's online calculator talks about the "true cost of ownership." Tesla factors in the value of your time, cost of gas and EV incentives. We appreciate that there is much more to buying any car than the initial cost, but there is a lot of sunlight between Tesla's headline-grabbing $500/month cost and what you'll really pay. "Your net cost of ownership is five-to-six hundred dollars a month," said Tesla CEO Elon Musk in a conference call announcing the new pricing structure, adding, "As much as possible, I'd like to broaden the affordability of the car." Musk said he expects around half of the Model S "sales" in the US to be this new lease-like option.
I calculated my own numbers for the 85-kWh model and came out with an effective monthly cost of $1,133. Other Autoblog writers calculated theirs, and came up with results between $834 and $688. This makes us think that to hit that $500-a-month level you need to be in the center of a very strange Venn diagram.
In any case, Tesla has done some interesting things here. It worked with Wells Fargo and US Bank to reduce the cost of driving a Model S while also giving drivers the opportunity to own their cars. The banks, if you have good enough credit, will "provide 10% down financing for purchase" and that payment "is covered or more than covered by US Federal and state tax credits ranging from $7,500 to $15,000." Now, the loan is a 66-month term loan but, after 36 months, "you have the right, but not the obligation to sell your Model S to Tesla for the same residual value percentage as the iconic Mercedes S-Class, one of the finest premium sedans in the world, made by Daimler (also a Tesla partner and investor)."
So, that Tweet about how Musk was putting his money where his mouth is? As Tesla puts it: "Tesla CEO Elon Musk is personally standing behind that guarantee to give customers absolute peace of mind about the value of the asset they are purchasing."
http://green.autoblog.com/2013/04/02...l-s-500-month/
04-02-13, 04:19 PM
#2
Moderator: LFA, Clubhouse
There are plenty of 2008 S550s on various websites with asking prices representing nearly 60% depreciation from original MSRP.
That's the "peace of mind" that Tesla is trying to "guarantee" over a 5.5 year loan?
Like the $500/mo claim, Tesla as usual is 100% marketing and 0% substance.
That's the "peace of mind" that Tesla is trying to "guarantee" over a 5.5 year loan?
Like the $500/mo claim, Tesla as usual is 100% marketing and 0% substance.
04-02-13, 05:41 PM
#5
That is with huge depreciation factor in. They didn't say is cheap, just "revolutionary".
It is suppose to be $500 a month too after everything factor in, make sense if they compare to $500 oil change service of a S-Class. Probably $100 an hour for going to the gas station.......etc. The car is free after you counted everything, especially if you live in it
It is suppose to be $500 a month too after everything factor in, make sense if they compare to $500 oil change service of a S-Class. Probably $100 an hour for going to the gas station.......etc. The car is free after you counted everything, especially if you live in it
Last edited by BNR34; 04-03-13 at 04:50 PM.
04-02-13, 06:00 PM
#7
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Leases are never cheap, with the exception of leasing and then buying outright (with favorable market conditions).
The paradox of leasing is that it ends up being more expensive than buying outright, assuming you can get ~10-12 years out of the car (although this number obviously varies), and yet many people who tend to lease are ones who cannot afford, in the short term, to buy the car they are leasing outright. On the other hand, people who can afford to buy a car outright will usually do so (either immediately or after a 3 year lease) because they realize, in the long term, they are paying less than someone who continually leases a comparable car.
I've always said leases are for either the super wealthy who want to change cars every 3 years or the not so well off who simply don't do the long term math to find out what they're really paying in terms of an opportunity cost.
The paradox of leasing is that it ends up being more expensive than buying outright, assuming you can get ~10-12 years out of the car (although this number obviously varies), and yet many people who tend to lease are ones who cannot afford, in the short term, to buy the car they are leasing outright. On the other hand, people who can afford to buy a car outright will usually do so (either immediately or after a 3 year lease) because they realize, in the long term, they are paying less than someone who continually leases a comparable car.
I've always said leases are for either the super wealthy who want to change cars every 3 years or the not so well off who simply don't do the long term math to find out what they're really paying in terms of an opportunity cost.
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04-02-13, 07:50 PM
#8
Moderator: LFA, Clubhouse
Trying to fool the public with unrealistic figures or shaky comparisons to bad products won't win customers.
04-02-13, 11:07 PM
#10
Lexus Fanatic
its worth a shot. They need to start moving more vehicles. There is a lack of trust out there with the newest latest technology. I would out my 1k a month towards something that burns gas. The options and advancement over the last 5 years have been astonishing. We are seeing twin turbo V8s all over the place
04-03-13, 12:08 PM
#11
I meant in terms of Tesla/Musk's as-per-usual grandiose statements about the car. I think they would be much more successful if they just marketed the car on its merits (as I noted in the NYT controversy thread, which to me seemed a PR disaster on Tesla's part).
Trying to fool the public with unrealistic figures or shaky comparisons to bad products won't win customers.
Trying to fool the public with unrealistic figures or shaky comparisons to bad products won't win customers.
I do like the car, just not sure about their future, how long they will last.
04-03-13, 12:11 PM
#12
its worth a shot. They need to start moving more vehicles. There is a lack of trust out there with the newest latest technology. I would out my 1k a month towards something that burns gas. The options and advancement over the last 5 years have been astonishing. We are seeing twin turbo V8s all over the place
Fast and quiet is the goal of top executive daily sedan. I am paying attention to this car, this thing is almost as fast as an AMG S-Class at half the price, much less amenities though. But it sure is ultra quiet and smooth that no V12 can match.
IMO the only thing smoother and quieter then a Lexus LS and V12s are full electric cars.
Last edited by BNR34; 04-03-13 at 02:30 PM.
04-03-13, 02:16 PM
#14
Leases are never cheap, with the exception of leasing and then buying outright (with favorable market conditions).
The paradox of leasing is that it ends up being more expensive than buying outright, assuming you can get ~10-12 years out of the car (although this number obviously varies), and yet many people who tend to lease are ones who cannot afford, in the short term, to buy the car they are leasing outright. On the other hand, people who can afford to buy a car outright will usually do so (either immediately or after a 3 year lease) because they realize, in the long term, they are paying less than someone who continually leases a comparable car.
I've always said leases are for either the super wealthy who want to change cars every 3 years or the not so well off who simply don't do the long term math to find out what they're really paying in terms of an opportunity cost.
The paradox of leasing is that it ends up being more expensive than buying outright, assuming you can get ~10-12 years out of the car (although this number obviously varies), and yet many people who tend to lease are ones who cannot afford, in the short term, to buy the car they are leasing outright. On the other hand, people who can afford to buy a car outright will usually do so (either immediately or after a 3 year lease) because they realize, in the long term, they are paying less than someone who continually leases a comparable car.
I've always said leases are for either the super wealthy who want to change cars every 3 years or the not so well off who simply don't do the long term math to find out what they're really paying in terms of an opportunity cost.
yeah but manufacturers are often subsidizing leases with low APR and unrealistic residual value after 2-3 years so people can get 5 series of same price for smaller lease, right?
