It’s pretty hard to go one day without there being several articles about Elon Musk and the future of Tesla. The next Apple or the the next Nokia. Batteries, solar shingles, flamethrowers, but have we overlooked the elephant in the room? What is the future demand for leasing the Model 3?
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A car is no longer a car. Day by day, week by week, month by month the automotive world is making a historic and irreversible shift. Not just to electric cars, but to the cars themselves. I submit to you that automobiles are becoming electric devices similar to tablets or smartphones. A device to be upgraded every 2 or 3 years, not owned for 10. I believe this trend will result in a huge increase in the percentage of leases versus purchasing.
Model S Versus the Model 3
The Model S lease price is over $600 per month even with $7000 down, well out of reach of the average American. MSRP $62,000. The basic Model 3 at $35,000 should lease for $250 to $350 with far less down, right in the zone for the average car buyer.
iPad Compared to the Surface
No one can deny that some people bought the Microsoft Surface, but it is a Chevette compared to the IPad. Tesla is sex. If Malcolm Gladwell ever pens The Tipping Point 2, the Tesla Model 3 will be on the cover. In my opinion the word of mouth is going to push the Model 3 to well over 1 million lessees. A chance to step into the future and drive a starship, all for the cost of what you are driving today.
I don’t own Tesla stock, but I would never bet one penny against Elon Musk.
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