TESLA, the electric-vehicle maker that just raised $5 billion in a private offering, said it is offering its customers guaranteed second-hand car prices to Hongkongers to reduce the cost of living and boost the city’s economy.
In an announcement on its website, Tesla said it will offer $2,500 for a second-hands Tesla Model S sedan, $4,500 on a second hand Tesla Model X SUV, $5,000 on a third-hand Tesla Model 3 sedan, and $5 at a Tesla store.
“Tesla will help our customers reduce their second-handed car prices, which are often high, by providing them with guaranteed secondhand car price in the form of a monthly payment or a one-time payment to reduce their cost of energy and reduce their carbon footprint,” said a Tesla spokesperson in a statement.
“We will also provide them with additional incentives to encourage them to stay in Hong Kong.
We expect to continue offering these benefits to our customers in the months ahead.”
The company has set up a dedicated page on its site to offer the guaranteed prices.
The page also says Tesla is working on a “second-hand-price guarantee program for our customers” in Hongkou and other locations around the world.
Tesla said the guarantee will be offered to first-time buyers of a secondhand Tesla and any first-timers who pay a deposit.
“This will ensure that all our first-timer customers who have the car they want get it before we sell it to anyone else,” the spokesperson said.
“Our second-time customers will have to pay the guaranteed second car price at a car showroom.
We will also be working with them to determine their eligibility for the program.
We’re excited to share more details with our customers as they become aware of this program.”
The guaranteed car prices are not a total refund.
Tesla said the guaranteed price will apply to “a full month’s worth of Tesla Model E” for a customer to use if they paid $5 for the car in a Tesla dealership.
“For the first-year owner, the guaranteed monthly payment will be $1,000 per month, which means a monthly bill of $1.6, which is less than a quarter of the cost per month of a regular monthly car payment, according to the company,” the company said.
“For the second-year customer, the guarantee is a full month of Model X with a $1 per month deposit.”
The guarantees are available for first- and second-timer customers who pay Tesla the minimum deposit required to qualify.
The guarantees also cover those who paid a deposit for a car when the car was on the reserve list or when the vehicle was unavailable due to an accident or mechanical failure.
The company said its guarantee program is being implemented in partnership with Hong Kong’s government and that the guarantee amounts will be paid into the city government’s “first-time” tax credit program, which provides financial assistance for first time buyers.
The guaranteed second hands will also help reduce the costs of living for those living in Hong-Kong, Tesla’s spokesperson said, noting that a “guarantee is calculated based on the average cost of a comparable second-sale car.”
“If you can afford to pay more, we recommend that you pay the $1 a month deposit, but if you can’t afford to, we will still offer your car to you at a fair price, no matter how much you can pay,” the Tesla spokesperson said in the statement.
Tesla’s first-quarter financial results, released last week, showed a loss of $0.11 per share and a loss per share of 14 cents.
The company also said it expects its second-quarter revenue to be $2.45 billion.
The Palo Alto, California-based company said it plans to continue to invest heavily in its electric vehicle business in the United States and Europe, and said it planned to begin deliveries of its Model 3 later this year.
The electric-powered cars have gained momentum in China, where they are becoming a hot commodity and attracting attention from celebrities, including Elon Musk, a billionaire who has also invested heavily in electric-traded companies.