Discounts on new cars have grown rare. Discounts on new Tesla models are exceptionally rare. The all-electric automaker grew into America’s best-selling luxury car marque while regularly raising prices and rarely offering incentives.
Yet, if you can buy a car in the next 10 days, you might qualify for a rare discount on a new Tesla.
The company is offering $7,500 off the price of its Model 3 sedan and Model Y SUV if you can take delivery before the end of the year. Buyers also get 10,000 miles of free electricity on Tesla’s Supercharger network, provided they use it within two calendar years.
Probably a Response to Tax Law Changes
Tesla no longer operates a public relations department to answer reporters’ questions. So, we can’t get an official explanation. But we almost certainly have the federal government to thank for this rare opportunity.
Congress last year enacted changes to federal law controlling tax credits for electric vehicles. Those changes kick in on January 1.
Related: How Do Electric Car Tax Credits Work?
Tesla vehicles aren’t eligible for any federal tax credit before that date. But, come January 1, all Model Y SUVs and some Model 3 sedans will qualify.
That has caused many buyers to ask Tesla to delay delivery of their new car until January 1 or later so that they can claim the $7,500 credit on their federal taxes. Earlier this month, reports emerged that so many buyers had asked for the delay that Tesla executives were growing alarmed.
They briefly offered buyers half the credit’s value to take delivery before the first. With the deadline growing closer, they’ve now increased the offer.
Executives May Be Worried About an Artificially Low Delivery Report
Why does Tesla care whether you take delivery of your new car on December 31 or January 1? Likely, because the company reports sales results quarterly.
Tesla has had a rough quarter. Its stock value has plunged from more than $255 at the start of the quarter to, at press time, just over $125. Opinion surveys suggest the public has soured on the company amid controversy over CEO Elon Musk’s behavior since buying the social media site Twitter.
One survey even suggested the company’s famous brand loyalty has slipped, with many Tesla owners now unwilling to buy another Tesla.
Buyers delaying delivery could artificially lower fourth-quarter delivery figures when the company is ill-prepared for more bad publicity.
So Tesla would rather offer you a $7,500 discount today than see you take a $7,500 discount from the federal government later.
The Offer Means Some Should Act Now
Is there any risk in taking the deal? Not much. The fine print on the offer notes that “Tesla shall not be liable if delivery of your vehicle does not happen before December 31, 2022.” So it’s possible to place an order in time to get the discount but not qualify for it if the company delivers late. But, in that case, you could be eligible for the federal credit instead.
The offer is also a no-brainer for some buyers. It’s offered on every Tesla Model 3, but not every Model 3 will qualify for the tax rebate. The new rules institute a price cap of $55,000 for sedans and $80,000 for trucks and SUVs. Many Model 3 cars don’t qualify for the federal tax credit on price – but Tesla is offering the discount on those, anyway.
The federal offer is also income-limited, and Tesla’s isn’t. Buyers who don’t qualify under federal income caps — individuals with adjusted gross incomes over $150,000, $225,000 for those filing as head of household, and $300,000 for joint filers — can qualify for Tesla’s discount but not the tax rebate.
