Tesla has been providing unofficial discounts on new car purchases and actively addressing service and repair complaints.

According to fleet managers and leasing firms, Tesla had previously disregarded these concerns. 

Tesla Tries to Calm European Backlash Over Price Cut Fleet

Tesla is making efforts to address concerns raised by European leasing companies due to the negative impact of the automaker's frequent retail price reductions on their fleets' value.

Additionally, their corporate customers have been dissatisfied with the slow service and costly repairs.

According to interviews with executives from major leasing and rental-car firms, as well as corporate fleet managers, there have been recent efforts to tackle issues such as service, repair, and ordering complaints.

These efforts also involve offering unofficial discounts on new car purchases if they are available in stock. It appears that Tesla is taking steps to address long-standing concerns that fleet managers and leasing firms have claimed were previously ignored, as per Reuters.

Tesla has recently reduced its retail prices to boost sales, as the demand for electric vehicles has been weakening worldwide and competition, particularly from Chinese EV manufacturers like BYD, has been on the rise. However, this had a negative impact on the financial performance of its major clients in Europe, as fleet purchases account for almost half of all car sales in the region.

Leasing companies purchase brand new vehicles and organize lease agreements based on their projected resale value at the end of the lease term. Leasing firms incur financial losses due to unexpected decreases in price, which undermine the residual values.

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Tesla EV Prices Decline

Tesla's declining resale values and strained relationships with fleet customers have been acknowledged, but the company's efforts to address these issues have not been widely covered until now.

According to an anonymous top executive from a prominent European car-leasing company, Tesla has reportedly been providing unofficial end-of-quarter discounts on its Model 3 and Model Y.

These discounts, amounting to up to 2,000 euros ($2,134), were offered specifically for leasing-company purchases, as long as the vehicles were available in stock.

The executive, who preferred to remain anonymous due to the lack of permission to comment publicly on Tesla, revealed that these discounts have been available since mid-2023.

According to Tim Albertsen, the CEO of Ayvens, a prominent auto-leasing company in Europe, Tesla's service has shown signs of improvement.

However, he also expressed concern over the negative impact of falling resale values on the company's overall performance. Ayvens, known for its massive fleet of 3.4 million cars, with approximately 10% being electric vehicles, holds a significant position in the European market.

The Business Standard reported that a significant portion of Tesla sales in the UK and 15 other EU countries last year were attributed to leasing and rental-car company purchases. 

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