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Tesla Model S reservation resale

Hello,

I reservered my Tesla Model S (general production version) in June 2010. Due to changed family circumstances I'm currently considering to pass on this reservation to Tesla enthusiasts looking to get their hands on their Tesla earlier than expected.

Would anyone be interested?

It sounds to me like you just want to make more money off it. If you just ask for your money back, several thousand people will get their cars a teensy bit earlier. But I think your reservation says it's not transferrable anyway.

Unfortunately ggr is correct, the reservations are not transferable at all.

On other hand, could just buy the car and resell it.

Just out of curiosity, what's your reservation number?

Hehe, I was thinking the same question. I wouldn't want a P reservation, I am interested in the Sigs at this point since I added myself to the list too late.

I'm guessing right around 1500, given the reservation time frame of June 2010.

I think I made my reservation earlier then that and I'm P1,837

Then again, maybe it just seems like I reserved it earlier then that? Man I have been waiting a long time for my Model S... ;)

I made mine in Feb. 2010 and I'm P1649. But again, you can't sell your position.

April 2010 = P1842.....

I....can't.....take.......the.......waiting........

Linking a similar thread here, maybe it's interesting to read:
http://www.teslamotors.com/forum/forums/anybody-interested-purchasing-my...

I've posted my opinion there, so no need to repeat it here.

Hi,

Sorry for the late reply. There is no RSS on this (I think) so I was not able to monitor the responses.

Unfortunately it seems that I forgot to add that I purchased the reservation in Europe. If anyone is interested the reservation number is P282.

Secondly the reservation agreement does not specify anywhere that it is non-transferable.

And finally, yes, of course I would like to get more than 99% of what I put in. Tesla has been able to 'earn' a return on this 'deposit' certainly higher than 20% p.a. so before I cash in on 99% it is reasonable for me to see if there is any demand out there for the earlier slot.

Anyhow in case anyone is interested then please email me on partel@isepankur.ee

Wow. Tesla is making > 20% per annum on deposits? Is Bernie Madoff the treasurer?

Yeah are you serious Partel? I wonder if you really have a reservation or are just a fraudster. How can you think that they made 20%? In fact, unless they made some special deal with their credit processor, haven't they lost money on credit card processing fees?

Tesla has to keep the reservation money in a relatively liquid and safe form, which means low return, if any. I think They even mentioned it during their last investor call or report. THey have to be able to refund the money immediately if a customer cancels.

And that's what they're going to do for you. You're not allowed to sell your spot, your only option is to cancel. The reservation is in your name. Tesla will only sell and deliver the car to you. Your only option is to either buy the car and resell it (you may be able to turn a profit this way actually) or negotiate this privately.

"I purchased the reservation in Europe"
"Secondly the reservation agreement does not specify anywhere that it is non-transferable."

I doubt the European version differs from the U.S. Reservation Agreement in this fashion. Though theoretically it might.

Here's the U.S. language...

6. Deferral and Non-Transferability

If you do not wish to enter into a Purchase Agreement at the time that you are contacted by Tesla, you have the option to relinquish your reservation sequence position and defer to a later position to be determined by us (only one deferral is permitted). If you do not communicate your decision to us within ten (10) days of notification under paragraph 4, you will automatically be granted such a deferral. This Agreement is not transferable or assignable to another party without the prior written approval of a Tesla authorized representative.

Anyone familiar with financing startups is probably aware that getting capital with a cost of under 20% p.a. is quite impossible. None of the investors put on money hoping to get 8% p.a. as the risk is just too high when investing in tech startups. Therefore getting cash with effectively a negative interest rate from the customers saves them the cost of financing. The (EU version) of the agreement even stipulates the following: "Use of Funds. The Model S reservation fees will be used to fund the growth of the company and its infrastructure required for the successful launch of the Model S. You acknowledge that your reservation fee may be lost, in part
or in whole, if Tesla ceases to be viable as a company. If Tesla remains viable, but the Model S program is cancelled, you will receive a full refund."

The US agreement seems to be quite different from the one used in EU which is only one page long and has no mention of any of what you quoted. The only sections in the agreement are: Reservation Step 1, Reservation Step 2, Priority, Estimated Purhcase Price, Cancellation, Limitation of Liability and Use of Funds which I quoted above.

Anyhow if anyone is interested then my email is partel@isepankur.ee. I can provide you all the documents I've received from Tesla as well as payment slips.

brianman;
The US agreement doesn't forbid transfers, it just requires TM's approval:
"This Agreement is not transferable or assignable to another party without the prior written approval of a Tesla authorized representative." Question is whether they would withhold approval, and if so, why?

I can see a hypothetical concern about a wild secondary market in traded reservations developing, but that's rather a remote danger, I think.

As far as the EU agreement, it may be that laws there forbid restriction of transferability of any asset you've paid for. I don't know.

I'm wondering if anyone has actually approached Tesla to ask if they would consider giving written permission to transfer a reservation?

They might transfer a reservation to a relative, but not to a stranger.

Let the marketplace decide. If there is a dude that wants to pay 20% premium for a lower reservation number (and it is possible to transfer), more power to both dudes. And another proof that Tesla is selling a hot product, worth scalping.

By the way I found that the EU reservation agreement is still online so you can see the exact wording here http://webarchive.teslamotors.com/display_data/RA_ModelS_EU.pdf

Generally it would be against the law in EU to restrict such sales. Car manufacturers cannot even restrict non-official distributors selling their cars in EU (e.g. ones that are exported through Asia or South America) due to anti-trust laws.

I will contact Tesla on Monday to ask how should the transfer process look like.

Thank you, Pärtel, and make sure you post the answers here! Or maybe you want to continue the thread over in the "Europe" section as to not annoy the US reservation holders that are stuck with an overly restricted market... ;-)
http://www.teslamotors.com/forums/clubs/europe

Ah, and +1 Tiebreaker. That's exactly how it should work IMO.

The Model S Reservation OTC Exchange? Could be fun!

Of course I understood that reserving a Model S put your money at risk should Tesla slide towards insolvency, but at the same time I am assuming that, unless they are hiding it, they are not operating at the edge of complete failure, and are therefore keeping a good chunk of reservation payments for inevitable cancellations and eventual application towards purchases. I can't remember where but I thought I read/heard somewhere that they definitely maintained some sort of account for this and that they didn't just immediately begin spending the money. The shareholder letter this year showed they have a liability of about $91 million in reservations and yet are holding $255 million in cash. ( investor letter)

You are using slightly creative accounting to claim that they are making 20% off of reservation payments. I think that you are basically saying that borrowing cash from investors might cost them, for example, at least 20%. Since they are "borrowing" cash from reservation customers at 0%, then they are effectively "making" the 20% that it would have otherwise cost them to borrow the money. That sounds to me like when a politician says they are shrinking the budget by reducing the amount of (still positive) projected growth in the budget year-to-year. Or another example is if you were prepared to buy a burger for $5, but then you get to counter and happily discover that it only costs $4, and then tell everyone that you made a $1 profit by eating out today. That doesn't make any sense.

The only way Tesla is making/will make money is buy selling cars to customers and components/designs to auto makers (or by selling itself). They haven't done much of either yet. Again, ff they can take a bunch of cash, and make 20% doing a mysterious "something" that doesn't ivolve selling anything or investing in another undervalued enterprise about to start producing and selling something great, well then these folks are geniuses and should drop this silly car business and just do that full time or they're cons and you're never going to see your money again. But the notion that they are "certainly" making 20% on our deposits is crazy. That's only going to become true when they sell cars and then only if their margin is high enough.

olan;
there is some justification for the number. There is a de facto implicit cost of capital in the economy. It varies by risk, etc. If you don't need a loan, the bank will give you one at the minimum rate. But the more you need the money, the more you pay. The nominal 20% is implicitly 'calculated' to provide base ROI AFTER expected defaults across a large number of such investments.

If you can show me a safe place to put cash and return 20% p.a. In today's environment I'd find it difficult to believe you. I haven't seen interest rates that high in over 30 years, and not in the US.

MarkE;
Trick answer. I specified risk, and investment in a new company (like Tesla). How much, btw, do you think people pay on their credit cards if they just cover interest each month? How much does a venture capitalist want? How much will the bank charge for a big loan you if you work at home as an independent unincorporated consultant? (Not that such loans exist any more, which is to say the interest rate is effectively infinite.)

Hi all,

I have a Model S Signature Performance reservation # below 75, with estimated delivery ~8 weeks from now. I am willing to sell the car (or, with Tesla's blessing, the reservation) due to a change of heart.

Before the trolls attack, note that I'm a loyal Roadster owner who has spent all day hand-wringing over whether I want to sell Model S I've been looking forward to for almost 2 years. My garage is full, and I would reeeeally love to play with the toy I've been waiting for, but I am going to go with logic over emotion in this case.

It is configured black paint, black leather, piano black trim. MSRP $97,900 + tax.

If Tesla does not allow a transfer pre-sale, you would purchase from me directly in Los Angeles.

If you have a serious interest, please leave me a message with your offer at 310-997-0263, and I'll return your call. (The tax credit may not transfer to you, so please take that into account.) Thanks!

bay2la;
Surely you will know up front whether the credit transfers, and if not take that into account in the transaction price. I assure you the buyer will!!


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