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Tesla Model 3 to be among the UK’s best company cars amid EV-friendly policy update

A right-hand-drive Tesla Model 3. (Photo: Mick Paul/Twitter)

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In what could only be described as a “milestone moment,” the UK Treasury has confirmed that employees who drive zero-emission company cars will pay no benefit-in-kind (BIK) tax for the year. This decision heavily incentivizes businesses to purchase electric vehicles for their fleets, which contribute to nearly six out of ten new car registrations in the UK today. 

Under the updated rules from the government, those who choose zero-emission vehicles will pay no company car tax for the year from April 2020, followed by a measly 1% tax from April 2021 and 2% BIK from April 2022. This is in stark contrast to the BIK taxes placed on vehicles equipped with the internal combustion engine. A BMW 3-Series with a 2.0-liter diesel engine, for example, is priced at £32,000 (~$40,200). But due to its CO2 emissions of 110 and 115g/km, the vehicle will be subject to a 31% BIK rate from April 2020. 

Considering that the UK’s personal income tax rates can hit 40% for taxpayers earning £50,001 (~$62,000) to £150,000 (~$188,500) per year, those under the income bracket would pay £4,000 (~$5,000) in BIK just for using the diesel-powered BMW 3-Series from April 2020 and March 2021. Taxpayers in the same income bracket that drive a Tesla Model 3, on the other hand, would pay no BIK for the same period. The 1% tax and 2% BIK that follows in the next two years are also marginal. 

In a statement, the government noted that the regulations are expected to encourage businesses to make informed decisions about their purchase of fleet vehicles. “By providing clarity of future the appropriate percentages, businesses will have the ability to make more informed decisions about how they make the transition to zero-emission fleets. Appropriate percentages beyond 2022-23 remain under review and will be announced at future fiscal events,” the government stated. 

It’s not just all-electric vehicles like the Tesla Model 3 that will benefit significantly from the UK’s updated policies. Plug-in hybrids could also take advantage of the government’s zero company car tax rate, provided that the PHEVs are capable of operating at least 130 miles as a pure electric car. Unfortunately, there are no PHEVs in the market today that meets this metric. This is quite ironic since BMW director of development Klaus Frölich recently stated that the carmaker is focusing its efforts in developing PHEVs with only 80 km (49 miles) of pure electric range. “PHEV gives them full freedom and 80 km of EV range,” he said. 

Plug-in hybrids with short electric ranges, such as those mentioned by the BMW executive, will still see tax breaks, though they are notably less generous than those granted to all-electric cars. PHEVs that have less than 30 miles of electric range, such as the BMW 225xe Active Tourer, will be subject to a 12% BIK tax from April next year. 

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With these new regulations in place, the Tesla Model 3 has the potential to become one of the most competitive company vehicles in the UK. The car, after all, boasts 240 miles of range even at its Standard Plus variant, and it comes from a company that competes in the premium segment. Considering that company cars used by middle-level to upper-level employees are usually premium vehicles, Tesla’s midsize sedan might prove to be a perfect fit. 

The turnover rates for company vehicles in the UK is quite quick, with approximately 300k-500k company cars coming off lease every year. If Tesla could tap into this market with the Model 3, the company could have a steady stream of EV buyers that will likely keep the demand for the vehicle thriving in the region for a considerable length of time. The UK’s company car market is now ripe for the picking for EV makers, and if Tesla plays its cards right, it could very well be on the lead to take the first bite.

Simon is an experienced automotive reporter with a passion for electric cars and clean energy. Fascinated by the world envisioned by Elon Musk, he hopes to make it to Mars (at least as a tourist) someday. For stories or tips--or even to just say a simple hello--send a message to his email, simon@teslarati.com or his handle on X, @ResidentSponge.

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Energy

Tesla Model 3 and Model Y can now do what only Cybertruck could

Tesla Model 3 and Model Y can power your home with Powerwall 3 during outages.

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Tesla has turned its two top sellers into backup batteries for the house.

Tesla Energy announced on Tuesday that Powershare Home Backup is now available for new Model 3 and Model Y vehicles paired with a Powerwall 3, saying the car can “extend your home backup by over 2 days.” Minutes later, Tesla’s main account quoted the post with a broader pitch: “With Powerwall 3, every Tesla can now serve as your home’s backup battery.”

Until this week, the Cybertruck was the only Tesla that could send power back into a home, and that capability only began working alongside Powerwall 3 last month, after years of ambitious targets.

Tesla’s updated Powershare page says every Model 3 and Model Y ordered in the U.S. or Puerto Rico on or after October 1, 2026 can use the feature. Some, but not all, earlier cars also qualify. Owners can check on the touchscreen under Software, then Additional Vehicle Information, where a capable car shows “Powershare Support: Enabled.” As Electrek reported, bidirectional power on the two cars runs through an inverter Tesla calls PCS2 Lite, and the company has not said when that part entered production on each trim.

The home side is simpler. A house that already has a Powerwall 3 and either a Wall Connector 3 or Universal Wall Connector needs no additional equipment, and Tesla says compatibility is enabled through a software update. When the grid drops, the Powerwall and the car work together, with up to 11.52 kW of continuous power available. Tesla’s “over two days” estimate assumes a home using 30 kWh per day and a car starting at a 90 percent charge. Standard trims are rated for up to two days, while the Cybertruck adds more than three.

There are limits. Powerwall 2 and Powerwall+ support is listed as “coming soon.” Model S and Model X are not included, and Grid Support, the program that lets Cybertruck owners in Texas send power back to the grid during demand spikes for bill credits, is not available for Model 3 or Model Y.

The rollout also lines up with something Elon Musk said more than three years ago. At Tesla’s March 2023 Investor Day, Musk said, “I don’t think very many people are going to want to use bidirectional charging, unless you have a Powerwall.” Tesla has now shipped the feature for its volume cars with exactly that requirement attached.

The Powerwall pairing was the hard part on Cybertruck. Tesla told owners in December 2025 that Powershare with Powerwall had been pushed to mid 2026, and lead engineer Wes Morrill explained that two devices capable of forming a home’s grid have to negotiate which one leads during an outage, across multiple generations of hardware. With that work done for the truck, Tesla was able to extend it to the Model 3 and Model Y within a month.

Ford and GM have offered home backup from their EVs for several years, but both require a separate inverter and backup hardware. Tesla’s version leans on equipment many Powerwall 3 owners already have on the wall. Powershare for the two cars also ships as part of software update 2026.38.3, the same release that began delivering Halloween Mode on Tuesday.

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Tesla ships ‘spooky’ Halloween Mode with creepy and fun features

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Credit: Tesla

Tesla is now starting to ship a “Halloween Mode” that is filled with some creepy and fun features; the company says, “This spooky update turns your Tesla into a haunted house on wheels.”

The update is just the latest in a series of updates that Tesla typically ships out in a seasonal fashion. The Spring and Summer Updates provided some fun novelty items while also packing some cool features that are actually useful for the ownership experience.

This one seems to be more fun-forward, and there are not any updates to the Full Self-Driving suite or overall operation of the vehicle. Instead, these novelty features are geared toward getting you in the mood for the Fall and Halloween.

New Ghost Costume on Car Avatar

Driver Visualization will now show your vehicle as a ghost, as an all-white sheet is draped over the vehicle. Pedestrians are turned into mummies or skeletons, and other vehicles are all a spooky green:

Credit: Tesla

Additionally, the Park Scene with your Tesla now displays that ghost costume draped over your vehicle in the foreground of a scary backdrop with Jack-o-Lanterns and a haunted house:

Credit: Tesla

Trick or Treat Mode

Trick or Treat Mode will enable the vehicle to play spooky sounds and flicker the lights as visitors approach. This might be a nice touch for when you’re handing out candy to kids on Halloween Night.

Other Features

Tesla is also adding a new Light Show, new Wrap Options, and a new Lock Sound with this update.

Credit: Tesla

Additionally, Photobooth has a new Halloween option:

Credit: Tesla

You will also be able to speak remotely through the app and transmit your voice to people outside, which is not a new feature, but the car will say it in a voice of its own, which is a new feature with that bullhorn-like feature.

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Investor's Corner

SpaceX reveals how its 1 Million AI satellite network will work and prevent space collisions

SpaceX reveals plans for one million Starmind AI satellites and calls out operators hiding maneuvers.

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Concept rendering of SpaceX Starmind constellation via Grok
Concept rendering of SpaceX Starmind constellation via Grok

SpaceX has put the largest satellite count it has ever published into writing, and it says that plan only works if every other operator in orbit starts sharing what it knows.

In a new Space Safety page highlighted Tuesday morning by Sawyer Merritt on X, SpaceX said it “plans to operate up to 100,000 Starlink satellites and up to 1 million Starmind AI satellites to meet the growing demand for broadband and supercompute.” Starlink has a little over 11,000 satellites in orbit today, so the target alone implies roughly a ninefold expansion of the broadband network.

Starmind is SpaceX’s orbital AI compute constellation. Elon Musk confirmed the Starmind name in June after an xAI trademark filing surfaced, and in August SpaceX said it was working with Nvidia on the compute payload. The FCC accepted the filing for up to one million satellites back in February.

FCC accepts SpaceX filing for 1 million orbital data center plan

SpaceX also released a new render of what a full Starmind constellation could look like. Alongside it, SpaceX VP Michael Nicolls explained why the satellites will not operate on their own. “We need to operate clusters of satellites in tight formation to get enough coherent compute to run AI models efficiently,” Nicolls said. “A cluster will be 10-ish satellites connected with 10 terabits or so of bandwidth between them, and interconnected to the broader constellation.”

That is the most specific detail SpaceX has given on how Starmind will be built. Instead of a million independent servers, the network would work as tightly packed groups of about 10 satellites acting as one compute unit, with Starlink’s laser links carrying results back to Earth.


Packing satellites that close together, at that scale, makes collision avoidance the central problem, and most of the Space Safety page is aimed at other operators. SpaceX said Starlink encountered collision risks with about 650 unique maneuvering third party satellites in 2026, and only about half of them shared data. Over six months, Starlink recorded roughly 164,000 more collision risks where the closest approach came within four hours of an unannounced maneuver.

Some operators keep maneuver plans private over proprietary concerns, while others cannot get government permission to share them. SpaceX called those policies “counterproductive,” saying they “largely only serve to create preventable collision risk between satellites.” Starlink is also offering a free ephemeris sharing and screening platform that returns risk results within a minute, backed by its Stargaze network of 30,000 optical sensors.

The push comes as the Starmind application draws opposition from astronomers and environmental groups. In a September filing with the FCC, SpaceX said each Starmind satellite could weigh up to 4,000 kg, nearly seven times the mass of a Starlink V2 Mini. Musk has brushed off crowding concerns before, telling viewers in June that “space is enormous” and that SpaceX already knows how to run very large constellations safely.

SpaceX’s Starmind page says its Gigasat factory in Bastrop, Texas, is designed to produce AI satellites at scale, with deployment of thousands of units starting as soon as late 2027.

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