Tesla (TSLA) goes back to 0% financing but forces you to buy ‘Full Self-Driving

Tesla (TSLA) is already back to offering a big incentive in the US even though we are only in the second week of the new quarter, but there’s a catch.

Tesla’s incentives come in waves, which generally intensify at the end of each quarter, and then, there’s a short period without incentives at the beginning of each quarter.

That’s why I was surprised to see Tesla bring back its 0% financing this quarter in the US just a week after ending its subsidized financing program to help sales at the end of last quarter.

Tesla updated its website last night to add a new 0% APR offer on new Model Y and Model 3 orders in the US:

In the current high interest rate environment, it’s a big incentive to get subsidized rates like this, but as you can see, there’s a big caveat: Tesla makes you buy its $8,000 Full Self-Driving (FSD) package to get the rate.

Tesla appears to want to boost its FSD take-rate, which is believed to be quite low.

CEO Elon Musk claimed that Tesla vehicles became “appreciating assets” because they are all capable of FSD, and Tesla would keep increasing the price of the package as its FSD software gets better and closer to a robotaxi-level autonomous system – increasing the value of the vehicles.

However, that turned out to be false.

Tesla did increase the price to $15,000, but last year, it reversed its strategy and started decreasing the price to $8,000, which contributed to the crash in the value of Tesla vehicles.

FSD is also still far away from being capable of robotaxi level autonomy based on crowdsourced data.

The new 0% APR incentive is available on 72-month terms with 15% down payment. Tesla didn’t put a firm timeline to take advantage of the incentive.

Electrek’s Take

Tesla needs a very strong fourth quarter if it wants to be up in overall deliveries for the year so it makes sense to start early with the incentives, especially in the US.

However, I don’t know how many people are going to be willing to add a $8,000 FSD package to their purchase to get the 0% APR.

Maybe Tesla will use the eyes it will have from its We, Robot event tomorrow to promote this deal.

It’s a smart move early in the quarter as the FSD margin is going to compensate for the subsidizing of the 0% APR. Later in the quarter, I wouldn’t be surprised if Tesla removes the requirement to add FSD.