Tesla lowers Model S financing costs, guarantees highest resale value of any luxury sedan

A month ago, Tesla Motors announced what it called a "revolutionary" financing option, and waved some magic pixie dust around to come up with a monthly cost of like $500. Today, Tesla CEO Elon Musk announced a bunch of changes to the financing options and to Tesla's online calculator to be more realistic and better represent people's real-world costs. Despite an early reshuffling of the numbers, Tesla got a lot of negative feedback regarding the pixie dust and today, Musk said, "We decided we were wrong and other people were right and we decided to fix it."

Here are some of the changes:

• Most importantly, Tesla has raised the guaranteed resale value to be the highest of any luxury sedan made in volume. That means that a "leased" Model S will be worth more than the average resale value of all Audi, BMW, Mercedes, Lexus or Jaguar vehicles in the same price range (based on ALG resale value numbers).
• In the online calculator, where Tesla talks about the "true cost of ownership," many defaults have been changed. The "time saved" option is now turned off, the expected gas price has been lowered, the MPG of the gas car has been raised. In short, the defaults are more conservative, but anyone can still enter any values that apply to them.Tesla financing partners are now also offering longer-term loans (72 months instead of 63) that will "reduce the monthly payment considerably," Tesla says. Tesla's new numbers, featuring less pixie dust, are "a monthly rate of $580 taking only gasoline savings into account" and, if you buy the car for business and we assume that 70 percent of the miles are for business use, the "effective monthly cost" is just $315. Musk said he believes that financing (or leasing, as most of us call it) is the right way to buy an electric car because, "it really highlights the savings you get form gasoline every month."

Musk said that so far, around 20-25 percent of the Model S vehicles sold since the financing options were announced have been financed, and that he expects this number to jump to 60 percent or more in the future. Early birds who jumped at the chance in April don't need to fret, since the improvements to the financial offering will be retroactive to anyone who already took advantage of the Tesla financing.

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Tesla gains legal ground in New York dealer fight

Tesla Motors gained a legal victory in its continuing efforts to expand sales across the US now that New York Supreme Court Justice Raymond J. Elliott III decided that local dealers will not be allowed to cite the Franchised Dealer Act as a reason to sue competitors, Automotive News reports.

Tesla has been embroiled in a legal tussle in the Empire State (and others) since last October, when New York dealers sued Tesla in an effort to get the California-based company to shutter the state's company-owned stores. Tesla operates three stores and two service centers in New York.

Tesla has long argued that it should be allowed to operate its own stores because of the different nature of cars like its Model S and the fact that servicing those vehicles is simply different than working on conventional vehicles. Traditional laws dictate that car sellers be franchises that are independent from automakers.

Tesla chief Elon Musk was in Texas this week lobbying for a law that would allow electric vehicle companies to sell their cars directly to the public. He hinted Tesla could build a factory in Texas, the state with the second-highest number of publicly accessible charging stations to (after California), at some point in the future.

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