Tesla dramatically reveals a 66-month car loan that acts like a lease

Amid a drumbeat of publicity about a major announcement today, Tesla Motors dramatically took down its website and held a conference call to reveal...a fancy car loan.

For Tesla, having built 4,750 Model S sedans, such things still count as big news. And given the difficulties of selling an all-electric sedan that starts at $62,000 with worries about how long the batteries will last, the loan has a few unique quirks, including a personal guarantee from Elon Musk of the car's future value. But with a monthly payment of more than $1,000, it's not for everyone.

The majority of luxury buyers drive off the dealership lot with a lease, the less-costly way in the short term to buy a car. But with no history of how its vehicles would age over the years nor how quickly their value would decline, traditional finance companies and banks wouldn't write a lease deal for a Model S.

The new deal, negotiated with Wells Fargo and US Bank, looks like a 66-month car loan, with 10 percent down and a 2.95 percent interest rate. After three years, the owner can — but isn't obligated — to sell it back to Tesla for what the company says is a guaranteed residual value of about 61 percent, or roughly the same depreciation as a Mercedes S-Class. As a backstop, Musk says he will guarantee the value of the Model S with his own personal wealth.

While Tesla says the deal can reduce the monthly cost of owning a Model S from a minimum of $1,051 to nearly $500 a month, its own calculator demonstrates acrobatics rarely seen outside a Cirque de Soleil show to reach that number, assuming things like business tax deduction and the value of time reclaimed from pumping gas. (It has no entry for time spent recharging.)

"As much as possible, I'd like to broaden the affordability of the car," Musk told reporters today. "By providing a compelling financing solution for the Model S, we're helping to broaden the access of customers to the car." But Musk also reaffirmed, following the cancellation of the cheapest Model S variation on Monday, that a lower-price Tesla was still some distance in the future. Before it can change the world for good, Tesla has to prove it can make money in the same way automakers do today.