Why #Tesla Should Start a Bank

Okay, that’s an easy no. I suppose I’m not above a click bait headline or two. 

But being that Tesla is getting ready to attack the mass market in a big way, perhaps it’s time for them to start looking into financing the car loans that customers buy their cars with. 

It’s a beautiful business, when you think about it. And it’s almost exactly the same as a traditional bank. If Tesla creates a financing arm that accesses funds from credit and money markets at today’s historic low rates, it can turn around and package them into auto loans at much higher margins, to offer their customers. All the major car companies do it. It’s a good way to improve sales and also make loan profits. Last year, Mercedes Benz made €18 billion in their financing arm world wide. 

If Tesla is going to hit the big leagues in terms of sales and volume, it might be time for them to in house their financing business. 

Maybe that’s what Elon wants to announce on the 17th? 

Let’s wait and see.  

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