Key Takeaways
1. Tesla plans to increase lease prices for the Model Y and Model 3 after September 21, 2023.
2. The monthly lease price for the Model Y will rise from $399 to $479, and the Model 3 will increase from $299 to $349.
3. Customers must order by September 21 to utilize the $7,500 federal tax credit as a down payment for the Model Y lease.
4. Tesla is reducing some incentives due to high demand, but manufacturing costs may also lead to further price hikes.
5. The promotional APR rate for the Model Y remains at 3.99%, while the company focuses on leasing over direct cash price increases.
Tesla has hinted that the high demand for its top-selling vehicles, including the Model Y and Model 3, might lead to price increases. The company has confirmed that the current leasing promotions for the Model Y will conclude on September 21.
Upcoming Lease Price Changes
After September 21, the monthly lease price for the Model Y will rise from $399 to $479. In contrast, the Model 3 will see a smaller increase. The least expensive lease currently starts at $299, but from September 22, it will increase to $349 per month.
This means an $80 increase for the Model Y lease and a $50 rise for the Model 3. Tesla is taking advantage of the surge in orders this quarter, driven by the approaching deadline for the government tax credit expiration. Customers who wish to apply the federal tax credit as a down payment for their new Model Y must place their orders by September 21 to benefit from the $399 lease offer.
Tax Credit Remains Available
After this date, the lease price will go up. However, if customers sign a lease with a small down payment or start a trade-in, they can still utilize the $7,500 tax credit upon delivery, even if it occurs after September 30, when the credit officially ends.
Tesla mentioned that the various Model Y APR financing offers and leasing promotions have generated a level of demand not seen in recent quarters, which experienced a decline due to Elon Musk’s political actions and general issues in the electric vehicle market.
Adjustments to Incentives
As a result, the company has begun to eliminate some incentives, like free wheel or color upgrades for inventory models, but it hasn’t been enough to reduce demand. Tesla has also noted that additional components ordered from suppliers beyond the original amounts have led to increased manufacturing costs, which may require a price hike.
Given that most customers in the U.S. choose to lease their Teslas, the company decided to cut back on the promotional monthly lease rates for the Model Y and Model 3 instead of increasing the cash prices directly or modifying the promotional APR rate, which remains at 3.99% for the Model Y.
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