Exclusive-Musk took leased cars back so Tesla could use them as "robotaxis." Instead, Tesla sold them

By Chris Kirkham and Abhirup Roy

(REUTERS) -Tesla past November ended an antithetic argumentation that prohibited U.S. leasing customers from buying their cars astatine lease-end.

The argumentation started successful 2019, erstwhile Tesla announced that customers could lease its mass-market Model 3 sedans but would person to instrumentality them, astatine the extremity of the lease, for usage successful Tesla's planned "robotaxi" network.

"You don't person the enactment of buying," Chief Executive Elon Musk said astatine an capitalist gathering successful California successful April 2019. "We privation them back."

"Next year, for sure," helium added, "we'll person implicit 1 cardinal robotaxis connected the road."

None of that would beryllium true. Despite repeated promises, the robotaxis ne'er came. Tesla alternatively recovered an unusually lucrative mode to marque wealth by flipping galore of the off-lease cars to caller buyers, according to 4 radical acquainted with Tesla's retail operations.

Rather than storing the utilized cars – a fast-depreciating plus – Tesla started adding features to them done bundle upgrades. It past sold the vehicles to caller customers who would wage thousands much than lease-end buyers would have, the radical said.

The signifier was an casual mode to "jack up the price" of the utilized vehicles, said 1 of the people, who asked not to beryllium identified.

Tesla and Musk didn't respond to requests for remark for this story.

Although antagonistic to what Musk said publically – and descriptions Tesla gave connected its website regarding lease presumption – the maneuver appears to person been legal. Still, the signifier denied lessees the industry-standard enactment of buying their vehicles and misled them for years astir why.

It besides perpetuated the story among investors that Tesla was adjacent afloat autonomous driving technology. That content has helped buoy Tesla stock, whose worth has acold outpaced existent net and made it the world's astir invaluable automaker.

Throughout the industry, lease contracts typically let customers to wage monthly to thrust a caller car for a specified play of time, often betwixt 2 and 4 years. The lessee doesn't ain the conveyance and indispensable instrumentality it to the trader erstwhile the lease expires. In astir each cases, customers tin take to bargain the conveyance astatine lease-end oregon earlier.

Since 2019, Tesla fiscal statements show, the institution has leased to customers worldwide much than 314,000 vehicles, oregon 4.4% of its full deliveries. It isn't wide whether the no-buy argumentation applied anyplace extracurricular the United States.

The argumentation was good suited for the years aft the onset of the COVID-19 pandemic, erstwhile conveyance inventories tightened and car prices spiked. More recently, arsenic request has plummeted – successful portion due to the fact that of immoderate consumers' distaste for Musk's right-wing governmental activities – buyers aren't arsenic enthusiastic for utilized Teslas.