Luxury-brand F&I managers may not need to worry that their customers who always opt for a lease will be tempted by a Tesla Model 3.
Tesla Inc. does not plan to offer a leasing option on its white-hot Model 3 this year, as it focuses "on cash sales," the Palo Alto, Calif., electric vehicle maker confirmed in its Q1 shareholder report.
Tesla also said it financed a mere 8 percent of vehicles in the first quarter. But its official figures on leasing may understate the actual volume of leases done.
"Starting January 1, lease accounting generally applies only to vehicles directly leased by us without using bank partners," said the automaker, whose sometimes-convoluted accounting has yet to show a profit on making and delivering vehicles.
Of course, not offering leases may not matter — yet. Tesla revealed it had more than 450,000 Model 3 reservations — paid in cash — at the end of the first quarter. That is far more reservations than the number of cars Tesla is likely to produce this year.
The "mass market" Model 3 is considered Tesla's make-or-break vehicle. So far, it's proving to be more break than make. Production slowdowns and build-quality issues have prevented the Model 3 production ramp-up from getting out of second gear. Model 3 production hit 2,270 per week in April, below the 5,000 units per week that Musk said would bring the company to cash-flow positive.