Tesla pushes leases and buyouts as it increases US EV tax credit?

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Wait, the US tax credit for electric vehicles is over, right? What do I do by putting it in the title now?

Well, a month ago, we wrote about some news that broke before the US EV tax credit expired. Ford and GM have figured out a loophole to primarily use the tax credit after the third quarter. They were essentially selling their cars to themselves before the deadline, scoring the tax credit, and then they would be able to lease those cars at discounted rates.

At the time, I wrote the following regarding Tesla: “Now, what about Tesla? Tesla doesn’t have separate dealers. So, Tesla presumably couldn’t take advantage of this loophole. There’s no clear network of dealers who are independent partners of the electric car company and can enter into a binding written contract with the company. Unless I’m missing something, it looks like Tesla will lose out here and suffer competitively from the loophole.” This may in fact be the case and Tesla is simply trying to find a creative way to rally support in this difficult time. But here’s the email from Tesla that made me wonder about this again:

Leasing has its benefits

When you lease, you’ll be able to use all the features that make driving Tesla cars so fun – from Tesla Arcade to driving modes to full self-driving (supervised).¹ And at the end of the lease, you can buy your Tesla outright.²

Rental rates will increase by up to $80, request and apply by November 4, 2025 to qualify.³

Note there that rental prices will rise soon. Why? Are you running out of Teslas that you can somehow register before October 1st and get the tax credit? Or is it the high costs that impose this?

Whatever happens, Tesla is now offering and pushing something it hasn’t offered for a long time – lease takeovers. Maybe it’s that simple – the company is trying to stimulate sales, so it’s highlighting something that many may not know, which is that they can lease a Tesla and then buy that car at the end of the lease.

As a final point, intuitively, the value of that car will be higher now than the car was worth at the end of its lease a month ago, because there is no longer a $7,500 tax credit to reduce the cost of the new Tesla. This will help Tesla. Instead of being able to sell a car for $25,000 at the end of the lease, as a hypothetical example, maybe she could sell that car for $30,000 or $32,500 to the lessee. Increasing the value of a car after its lease expires is a clear benefit for Tesla, and there is no easier way to sell it without additional costs (transportation, cleaning and inspection, auction, etc.) than selling it to a lessee.

Any other thoughts on this? Will the percentage of Tesla sales that are leases increase in the fourth quarter? Historically, this is a very low percentage for Tesla compared to other automakers.