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Tesla finally offers lease-to-buy options for Model 3 and Y, but it’s not available everywhere
Tesla is starting to offer the option to purchase its all-electric Model 3 and Model Y vehicles at the conclusion of a leasing period in some markets in Europe and Asia.
For some time, Tesla has not allowed owners to purchase their cars at the end of a leasing period. The car is to be returned to the automaker with no chance of a leaseholder buying out the car at the conclusion of the period. The car would be added to the company’s used inventory, to third-party resalers, or reserved for the future use of the Robotaxi fleet.
Tesla’s Leasing Program
Tesla’s leasing policy is one of the few automotive programs that is subjected to a required return policy at the conclusion of a leasing period. In its 2020 10-K filing with the SEC, Tesla details its process for receiving leased vehicles when the period is terminated.
The company states:
“Our used vehicle business supports new vehicle sales by integrating the trade-in of a customer’s existing Tesla or non-Tesla vehicle with the sale of a new or used Tesla vehicle. The Tesla and non-Tesla vehicles we acquire as trade-ins are subsequently remarketed, either directly by us or through third parties. We also remarket used Tesla vehicles acquired from other sources including lease returns.”
In some markets in the U.S., Canada, and Europe, Tesla did allow Model S and Model X leaseholders with the option to purchase the vehicle at the end of the lease period.
Tesla says:
“At the end of the lease term, customers are required to return the vehicles to us or for Model S and Model X leases in certain regions, may opt to purchase the vehicles for a pre-determined residual value.”
This program did not apply to the Model 3 or Model Y, as anyone who leased either of these cars would be required to relinquish possession of the vehicle with no chance of purchasing it at the end of the lease. However, Tesla added a new section to the 10-K in 2020, detailing the possibility of a lease-to-buy option in some markets in Europe and Asia, and it applies to the Model 3 and Model Y. The company writes, “This is not available with the Model 3 and Model Y,” on its website.
Lease-to-Buy Option for Model 3 and Model Y in Europe and Asia
Tesla added new language to the 2020 10-K filing that details its decision to allow lease-to-buy options on its vehicles in Europe and Asia.
The company wrote:
“We have outstanding direct leases and vehicles financed by us under loan arrangements accounted for as sales-type leases under ASC 842 in certain countries in Asia and Europe, which we introduced in volume during the third quarter of 2020. Depending on the specific program, customers may or may not have a right to return the vehicle to us during or at the end of the lease term. If the customer does not have a right to return, the customer will take title to the vehicle at the end of the lease term after making all contractual payments. Under the programs for which there is a right to return, the purchase option is reasonably certain to be exercised by the lessee and we therefore expect the customer to take title to the vehicle at the end of the lease term after making all contractual payments.”
In summation, Tesla is offering the option to buy a vehicle at the end of a lease in some markets. The customer has the option to return the vehicle as well in some cases, and Tesla is “reasonably certain” that the leaseholder will take possession of the vehicle title when the lease ends.
Teslarati obtained a list of the countries where this lease-to-buy option is available, according to the Online Design Studio. Some countries have explicit language that states the vehicle leaseholder must return the vehicle, while others indicate there is an option to purchase the car at the end of a lease. Some do not have any language that indicates what the leaseholder must do, which could indicate that the option to purchase the vehicle is available at the conclusion of the leasing period.
The countries where a lease-to-buy option is available are:
- Belgium
- Croatia
- Denmark
- France
- Italy
- the Netherlands
- Poland
- Taiwan
A few examples show that there is explicit language that indicates a lease can be purchased outright at the end of the period.
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- France’s Design Studio contains language that indicates the vehicle can be purchased outright at the conclusion of a leasing period.
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- Taiwan’s Design Studio explicitly states the vehicle can be bought outright at the end of a lease period.
Other Design Studio examples show that the vehicle must be returned to Tesla at the end of the leasing period.
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- Tesla does not give the option to buy the vehicle outright at the end of the lease in Germany.
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- Tesla explicitly tells U.S. leaseholders that they “forgo the option to buy your car at the end of the lease and must return it to Tesla after the lease term.”
Lastly, other Design Studios show no language either way, which seems to indicate the option to buy the car is available as the lease term expires.
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- Tesla Poland has no explicit language stating that the car must be returned to Tesla.
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- Tesla Italy also does not indicate specifically if the car should be returned to Tesla at the end of a lease.
Poland is one country where Tesla does not indicate whether the car is required to be returned at the end of a lease period. However, the option to buy the car at the end of the lease is available, according to one Polish Model 3 leaseholder who spoke to Teslarati. Model 3 leaseholder Szymon Janus said that Tesla does allow lease-to-buy options in his country of Poland, and at the end of the lease, can be purchased for “around 60% of the new car’s value,” he said. However, Tesla isn’t offering the lease-purchase option directly, it is operated through a bank, he says. This could be why Tesla has no explicit language depicting the required return of the vehicle at the lease’s end date.
Tesla has not revealed any further details within its 10-K filing that indicate whether the company will allow leased vehicles to be purchased at the end of a leasing period. However, it did detail some specific financial figures.
Tesla said:
“For the year ended December 31, 2020, we recognized $120 million of sales-type leasing revenue and $87 million of sales-type leasing cost of revenue.”
What do you think? Be sure to leave a comment below, or you can contact me directly at joey@teslarati.com or @KlenderJoey on Twitter.
Elon Musk
Tesla confirmed HW3 can’t do Unsupervised FSD but there’s more to the story
Tesla confirmed HW3 vehicles cannot run unsupervised FSD, replacing its free upgrade promise with a discounted trade-in.
Tesla has officially confirmed that early vehicles with its Autopilot Hardware 3 (HW3) will not be capable of unsupervised Full Self-Driving, while extending a path forward for legacy owners through a discounted trade-in program. The announcement came by way of Elon Musk in today’s Tesla Q1 2026 earnings call.
🚨 Our LIVE updates on the Tesla Earnings Call will take place here in a thread 🧵
Follow along below: pic.twitter.com/hzJeBitzJU
— TESLARATI (@Teslarati) April 22, 2026
The history here matters. HW3 launched in April 2019, and Tesla sold Full Self-Driving packages to owners on the understanding that the hardware was sufficient for full autonomy. Some owners paid between $8,000 and $15,000 for FSD during that period. For years, as FSD’s AI models grew more demanding, HW3 vehicles fell progressively further behind, eventually landing on FSD v12.6 in January 2025 while AI4 vehicles moved to v13 and then v14. When Musk acknowledged in January 2025 that HW3 simply could not reach unsupervised operation, and alluded to a difficult hardware retrofit.
The near-term offering is more concrete. Tesla’s head of Autopilot Ashok Elluswamy confirmed on today’s call that a V14-lite will be coming to HW3 vehicles in late June, bringing all the V14 features currently running on AI4 hardware. That is a meaningful software update for owners who have been frozen at v12.6 for over a year, and it represents genuine effort to keep older hardware relevant. Unsupervised FSD for vehicles is now targeted for Q4 2026 at the earliest, with Musk describing it as a gradual, geography-limited rollout.
For HW3 owners, the over-the-air V14-lite update is welcomed, and the discounted trade-in path at least acknowledges an old obligation. What happens next with the trade-in pricing will define how this chapter ultimately gets written. If Tesla prices the hardware path fairly, acknowledges what early adopters are owed, and delivers V14-lite on the June timeline it committed to today, it has a real opportunity to convert one of the longest-running sore subjects among early adopters into a loyalty story.
Elon Musk
Tesla isn’t joking about building Optimus at an industrial scale: Here we go
Tesla’s Optimus factory in Texas targets 10 million robots yearly, with 5.2 million square feet under construction.
Tesla’s Q1 2026 Update Letter, released today, confirms that first generation Optimus production lines are now well underway at its Fremont, California factory, with a pilot line targeting one million robots per year to start. Of bigger note is a shared aerial image of a large piece of land adjacent to Gigafactory Texas, that Tesla has prominently labeled “Optimus factory site preparation.”
Permit documents show Tesla is seeking to add over 5.2 million square feet of new building space to the Giga Texas North Campus by the end of 2026, at an estimated construction investment of $5 billion to $10 billion. The longer term production target for that facility is 10 million Optimus units per year. Giga Texas already sits on 2,500 acres with over 10 million square feet of existing factory floor, and the North Campus expansion is being built to support multiple projects, including the dedicated Optimus factory, the Terafab chip fabrication facility (a joint Tesla/SpaceX/xAI venture), a Cybercab test track, road infrastructure, and supporting facilities.
Credit: TESLA
Texas makes strategic sense beyond the existing infrastructure. The state’s tax structure, lower labor costs relative to California, and the proximity to Tesla’s AI training cluster Cortex 1 and 2, both located at Giga Texas and now totaling over 230,000 H100 equivalent GPUs, means the Optimus software stack and the factory producing the hardware will share the same campus. Tesla’s Q1 report also confirmed completion of the AI5 chip tape out in April, the inference processor designed specifically to power Optimus units in the field.
As Teslarati reported, the Texas facility is intended to house Optimus V4 production at full scale. Musk told the World Economic Forum in January that Tesla plans to sell Optimus to the public by end of 2027 at a price between $20,000 and $30,000, stating, “I think everyone on earth is going to have one and want one.” He has previously pegged long term demand for general purpose humanoid robots at over 20 billion units globally, citing both consumer and industrial use cases.
Tesla (NASDAQ: TSLA) reported its earnings for the first quarter of 2026 on Wednesday afternoon. Here’s what the company reported compared to what Wall Street analysts expected.
The earnings results come after Tesla reported a miss on vehicle deliveries for the first quarter, delivering 358,023 vehicles and building 408,386 cars during the three-month span.
As Tesla transitions more toward AI and sees itself as less of a car company, expectations for deliveries will begin to become less of a central point in the consensus of how the quarter is perceived.
Nevertheless, Tesla is leaning on its strong foundation as a car company to carry forward its AI ambitions. The first quarter is a good ground layer for the rest of the year.
Tesla Q1 2026 Earnings Results
Tesla’s Earnings Results are as follows:
- Non-GAAP EPS – $0.41 Reported vs. $0.36 Expected
- Revenues – $22.387 billion vs. $22.35 billion Expected
- Free Cash Flow – $1.444 billion
- Profit – $4.72 billion
Tesla beat analyst expectations, so it will be interesting to see how the stock responds. IN the past, we’ve seen Tesla beat analyst expectations considerably, followed by a sharp drop in stock price.
On the same token, we’ve seen Tesla miss and the stock price go up the following trading session.
Tesla will hold its Q1 2026 Earnings Call in about 90 minutes at 5:30 p.m. on the East Coast. Remarks will be made by CEO Elon Musk and other executives, who will shed some light on the investor questions that we covered earlier this week.
You can stream it below. Additionally, we will be doing our Live Blog on X and Facebook.
Q1 2026 Earnings Call at 4:30pm CT https://t.co/pkYIaGJ32y
— Tesla (@Tesla) April 22, 2026
Tesla confirmed HW3 can’t do Unsupervised FSD but there’s more to the story
Tesla isn’t joking about building Optimus at an industrial scale: Here we go
