Elon Musk admits Tesla's math was wrong - Silicon Valley Business Journal

Last week, when Tesla made the eye-popping claim that its Model S Luxury sedan could be leased for less than $500 a month, people were naturally skeptical.

It turns out they were right — that $500 pricetag relies on a Tesla buyer getting a greater-than-average tax rebate for living in certain states and being able to deduct the car as a business expense, things that very few prospective owners would be able to do. Without those favorable factors, the monthly payment nearly doubles.

Now Elon Musk is apologizing, saying the numbers didn't tell the whole story and vowing to do better.

"We appreciate the feedback from a number of journalists and customers that the first version of our financing product wasn’t quite right,” Musk said in a release. “They were right, so we are fixing it and, moreover, upping the ante by providing the best resale value guarantee in the automotive industry."

Tesla and its financing partners — Wells Fargo and US Bank — are rejiggering the terms of the lease rate to lower prices. The new terms lengthen the loan repayment time and up the resale promise to include Audi, Mercedes, Lexus and Jaguar in addition to the BMW S3. Under the new deal, Tesla owners should be able to get their payments down to about $580 a month just factoring in gasoline savings alone, Tesla said.

Click here to read Tesla's press release.

Companies: TSLA

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