Tesla Plans to Use Model 3 Lease Program to Stock Ride-Hailing Fleet

Tesla has launched a leasing offer for its $35,000 Model 3 electric sedan — without the standard option that allows consumers to purchase their vehicles at the end of the term. “With full autonomy coming in the future via an over-the-air software update, we plan to use those vehicles in the Tesla ride-hailing network,” the OEM said.

Tesla is betting that its ride-hailing network will be ready to go by 2022, said Jeremy Acevedo, manager of industry analysis at Edmunds. “Three years is when off-lease vehicles will start to roll in,” he said. “To put a pretty hard timeline on a [ride-hailing network] is aggressive.”

At the end of last year, the OEM reported that production was expected to outpace North American deliveries by 10,000 units during first-quarter 2019. However, due to “unforeseen challenges [Tesla] had only delivered half of the quarter’s numbers ten days before the end of the quarter,” the company reported this week noting a large number of vehicle deliveries will shift into Q2. Model 3 deliveries reached 63,000, but the OEM did not report production numbers for Model 3 during the first quarter.

Model 3 lease pricing starts at $504 per month for a 10,000-mile-per-year, 36-month lease.

Meanwhile, competition in the electric vehicle space is on the rise, Acevedo said. “When you look at the increased [electric vehicle] competition with BMW Group, Audi AG, and Jaguar, all these brands have fleshed out finance arms that are [comfortable with] extending lease deals to consumers,” he said, noting that 54% of luxury vehicles were leased in the first quarter. “This is an area of competition where Tesla historically has not been competitive.” By comparison, the 2019 BMW i3 electric vehicle monthly lease payment starts at $399 per month for a 36-month term.

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