Tesla has begun offering short-term rentals of its electric vehicles from select California stores to address slowing sales following the end of the federal EV tax credit. The program allows customers to rent models including the Model 3, Model Y, Model S, Model X, and Cybertruck for three to seven days starting at $60 per day. Renters receive perks like unlimited mileage and a purchase credit if they buy afterward.
Tesla rolled out its rental program in early November 2025, starting at stores in San Diego and Costa Mesa, California. The initiative targets excess inventory amid a slump in US sales, which dropped 24% in the first eight months of 2025 compared to the previous year. The company's market share in the third quarter fell to 38%, down from 49% a year earlier and nearly 80% several years ago.
Available vehicles include premium trims of the Model 3, Model Y, Model S, Model X, and Cybertruck, excluding base, Performance, and Plaid variants. Rental prices start at $60 per day for Model 3 or Model Y, $75 for the Cybertruck, and $90 for Model S or Model X. Rentals require a minimum of three days and a maximum of seven, with unlimited mileage but restrictions to in-state driving only. Each rental includes free Supercharging and access to Full Self-Driving (Supervised). A $30 fee applies if the vehicle is returned with less than 50% charge.
The program follows the expiration of the $7,500 federal EV tax credit last quarter, which had boosted demand but now pressures profit margins. Customers who purchase a Tesla within seven days of their rental receive a $250 credit toward the buy. Tesla describes the rentals as an extended test-drive to convert hesitant buyers, stating in an email to customers: “Rent a Tesla and see how it makes every errand, commute, and road trip more fun.”
Expansion beyond Southern California is expected before the end of 2025, marking the first nationwide implementation after a pilot hinted at two years ago in Texas job listings. This move highlights challenges from price wars, higher financing costs, and competition from legacy automakers, as seen in Hertz's recent divestment of Tesla vehicles due to low resale values.