Tesla developing an used-car program to sell second-hand Model S EVs

Article by Andrew Christian, on October 6, 2014

According to the latest reports, Tesla Motors is now developing a program to sell second-hand Model S vehicles. Apparently, there are some good reasons for doing this: drop the cost of the $71,000 electric sedan and developing a certified pre-owned program in order to better compete with similar-sized models offered BMW or Mercedes-Benz.

For those who don’t know, back in 2013 Elon Musk a.k.a. company’s CEO reassured customers about the guaranteed resale value of the Model S. Buyers who financed a Model S are able to return the car after three years and still recover between 43 to 50 percent of its original price tag. Musk said that even if Tesla is not able to honor the buyback guarantee, he will personally do it.

So, if the owners are interested about his offer, this means that the company will have a hefty number of used Model S sedans by 2016 and many more in 2017. Tesla offers business leases since April but quietly started to offer 36-month Model S leases to retail customers last week, on October 1.

The offers includes a $5,000 initial payment and $932 a month. With the used-car program Tesla will reach a new segment on the market and according to John Krafcik. a.k.a. president of TrueCar online car-buying service, the company will make between $6,000 and 10,000 for each used Model S that it sells.

This means more money for Tesla. Those who are seeking to buy a Tesla that costs around $40,000 will still have to wait for the new Model III, but will not get the same features available on the Model S.

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