Tesla’s Model S Buyback Plan: Genius or Crazy?
When Tesla Motors (NASDAQ:TSLA) first introduced its unconventional Model S finance plan back in April, critics questioned the strategy’s potential and charged the automaker with overstating customer savings. However, now it looks like electric car genius Elon Musk is once again ready to have the last laugh, because more and more analysts are coming around and recognizing the plan’s boosted revenue potential, and soon, more traditional automakers may also be jumping on board.
According to Bloomberg, Tesla’s finance strategy is advantageous for the Palo Alto, California-based electric car manufacturer because it sells its sedans exclusively through its own stores, and not through a dealer. That allows Tesla to set its own used vehicle resale prices for its customers who take advantage of the automaker’s lease-style options, and according to Bloomberg Industries analyst Kevin Tynan, that very control is what could help Tesla generate used Model S sales as high as $368 million in annual revenue in 2016.