July 1 was an important day for all of the electric vehicle manufacturers. The federal tax incentive for purchasing electric vehicles was cut in half, from $3,750 to $1,875.
Tesla Hides a Price Cut
Along with this price-cut came no change in Tesla Model 3 lease deals. In other words, the price to purchase a Tesla Model 3 went up but lease payments did not. That is effectively a price-cut and one that has not been advertised.
The whole thing gets hidden away because of the way the federal tax incentive works for electric vehicle leases. Instead of the tax incentive being collected directly by the customer, it is actually provided to the lessor.
This normally shows up on a lease agreement as a “capital cost reduction,” which effectively increases the down payment. It is then normally accounted for in a lower monthly payment.
But as we know, neither Elon Musk nor Tesla is normal.
The down payments on Tesla Model 3 leases are staying the same. That means Tesla just keeps the federal tax incentive, and that results in generating less revenue for Tesla.
This comes on top of previous price cuts for the Model 3, totaling almost 14 percent.
Elon Musk Is Monkeying Around
This is exactly the kind of monkeying around that we would expect from Elon Musk and Tesla. This activity is hidden. The resulting effective price cut suggests that demand for the Model 3 may be weaker than has been claimed.
This is not the kind of behavior one would expect from a public company. Any time a public company tries to hide something, investors should be suspicious. Companies should be completely transparent,