Tesla is No Longer Guaranteeing the Resale Value of its Cars

Tesla is No Longer Guaranteeing the Resale Value of its Cars

As of July 1, Tesla ended its Resale Value Guarantee program.

The program had guaranteed the resale value of a Tesla Model S after three years when purchased through one of the company’s loan financing programs.

The value of the car was calculated as 50 percent of the base purchase price of an entry-level Model S plus 43 percent of the value of all options added to the vehicle. The program was upgraded in 2013 to guarantee that a Model S would have a higher resale value than competing Audi, BMW, Lexus, Jaguar and Mercedes-Benz models.

The plan was developed to assure early adopters that there would be a resale market for the Model S and was originally backed by Tesla CEO Elon Musk to give owners “complete peace of mind about the long term value of the product.”

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The electric car market has moved significantly since the introduction of the Model S and the Resale Value Guarantee program, and according to a Tesla spokesperson, the program was discontinued “so that we can keep interest rates as low as possible and offer a compelling Lease and Loan program to customers.” The American automaker will continue to support customers that are currently financed through the Resale Value Guarantee program.

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