Gary Zhou 
Key Points
- 💰 Tesla introduces a new 84-month financing term option for EV customers.
- 🚗 Previously, Tesla offered financing terms of 36, 48, 60, and 72 months for car purchases.
- 📈 Longer loan terms may lead to higher expenses due to accrued interest and increased depreciation.
- 🤝 The new financing option aims to increase demand by making vehicles more affordable for cash-strapped customers.
Tesla now offers an extended financing option for EV customers, introducing an 84-month term to provide more financial flexibility for vehicle owners. The new option was made available on Friday, in addition to the existing 36, 48, 60, and 72-month financing terms previously offered by the automaker.
Buyers have the flexibility to choose their auto loan terms, each offering unique benefits. However, longer loan terms can lead to higher overall expenses due to accrued interest throughout the loan’s duration. According to BankRate, longer-term loans can also result in increased depreciation, with up to 20 percent lost in the first year and 60 percent by the fifth year.
Tesla’s decision to introduce an 84-month financing option could potentially boost demand for its vehicles, especially among customers who may be financially constrained. With reduced monthly payments, the new financing option makes Tesla’s vehicles more affordable and could contribute to increased sales.
Despite the potential rise in orders and the introduction of Full Self-Driving transfer policy, Tesla anticipates slightly lower production in the upcoming quarter due to widespread factory upgrades.
CEO Elon Musk said:
“…we expect that Q3 production will be a little bit down because we’ve got summer shutdowns to — for a lot of factory upgrades. So, just probably a slight decrease in production in Q3 for sort of global factory upgrades.”
