British motorists can now lease a Tesla electric vehicle for just over half what it cost a year ago, as Elon Musk’s company attempts to boost its flagging sales in the UK.
With Tesla’s market share falling across Europe amid stiff competition from Chinese rivals, the electric vehicle company has been forced to offer discounts of up to 40 per cent to car leasing companies to shift more units.
The ad hoc discounts to leasing companies — which pass them on to customers in the form of cheaper monthly payment plans — are also due to the lack of storage space for Tesla vehicles in the UK, according to industry sources.
Elon Musk is making Tesla cars more affordable
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A Tesla Model 3 can be leased for as little as £252 a month plus VAT on a 36-month contract at Silverstone Leasing, one of Tesla’s partners in the UK.
Tesla’s latest model, the Model Y, retails for about £60,000, but it was advertised for as low as £376.97 a month plus VAT on Synergy Car Leasing’s website last week. Other deals on the Model Y, which was only launched in May, were priced at just over £400 a month.
Last year, a Tesla Model 3 lease could cost customers £600 to £700 a month.
Tesla has not slashed the headline price of its popular models, including Model 3 and the Model Y, but it is now also offering zero interest finance deals for its cars in its retail shops to kickstart sales. That is expected to cost Tesla about £6,000 over three years for a £40,000 vehicle.
Fraser Brown, managing director of MotorVise, the automotive consultancy, said discounts to leasing companies, along with other financial incentives from Tesla dealerships, were a way of shifting more units without dropping the headline price.
“The most expensive way to find a home for these cars is by cutting the retail price. The cheapest way is to cut the monthly payments.
“So you can now buy a Tesla, through a contract hire company or through a retail environment inside a Tesla store, you can now buy one for about half what the monthly payment was previously.”
Ian Plummer, commercial director at Auto Trader, the listed marketplace for cars, which is an accredited Tesla leasing partner, acknowledged that leases on Tesla EVs were cheaper now than in previous years. “The main thing is you can access Teslas at more affordable prices and a lease is a good way to get a more affordable EV.
Protesters opposed Musk’s recent prominence in US politics, though he has now left his role in the Trump administration
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“They still have a huge chunk of the used EV market, with one in four being a Tesla. They are still popular and generate a lot of interest on our platform — new and used — no matter what people think of Elon Musk,” he said.
Tesla sales in the UK dropped by 60 per cent in July to 987 units, from 2,462 a year earlier. The decline pushed Tesla’s market share to 0.7 per cent, while China’s BYD claimed 2.3 per cent of all new registrations, according to the latest data from the Society of Motor Manufacturers and Traders.
Tesla did not respond to a request for comment.