Tesla Announces Certified Previously Owned Program

2014 Tesla Model S (Credit: Tesla Motors )

Have you wanted to purchase a Tesla Model S but found the price of even the entry-level version just too steep? Considering that the car is priced well above the cost of an average modern vehicle, many people have likely felt the same sense of disappointment upon learning that a Tesla is out of financial reach. The California-based automaker has a plan that will help expand its customer base beyond those who frequent country clubs and own yachts.

Automotive news originally reported the new plan from Elon Musk, calling it the CEO’s “ace up his sleeve” that could help Tesla Motors can an edge in a highly competitive market. The plan is brilliant and well-timed, considering that the Model S was originally released about two years ago. Many luxury brands see quite a few leases of brand new models, which are kept between two and five years before being returned. That would mean that there is a fresh batch to the Model S that are being prepared for consumers who want a deal for purchasing the electric car.

Presumably, Tesla would certify the overall condition of each Model S, including verifying the capacity of each battery. That kind of certification would go a long way toward easing the fears many car shoppers would feel in regards to purchasing a used Model S, considering that the battery costs a considerable amount to replace.

This news is excellent for people who are waiting a few more years until the Model 3 is released. These people have the desire to own an electric car that is advanced, luxurious and highly capable, but aren’t willing or are unable to spend $70,000-plus to own such a vehicle. With a CPO Model S, the price of the car could conceivably get down to about the anticipated price of the Model 3, opening the vehicle up to a whole new market segment.

Will this move prove to be a boon for Tesla Motors? It all depends on how much the company stands to make with each CPO sale and how many vehicles it can move through the program.