Tesla’s Bold Move: Short-Term Rentals Roll Out as EV Tax Credits Expire

Tesla pivots to rentals as government incentives dry up—because nothing fuels innovation like a disappearing tax break.

Elon's empire adapts with a new revenue stream, betting on flexible mobility over outright ownership. The timing? Impeccable—just as the EV subsidy gravy train grinds to a halt.

Wall Street analysts nod approvingly while counting their own tax-advantaged gains. Meanwhile, Tesla drivers get a new way to experience electric freedom—at a premium, naturally.

TLDRs:

• Tesla introduces short-term rentals in California as federal EV tax credits expire.
• Rentals include Full Self-Driving and free access to Superchargers for convenience.
• Customers receive $250 credit if they purchase a Tesla after renting.
• Tesla plans to expand rental services nationwide before year-end to boost sales.

Tesla has officially entered the short-term car rental market as part of its strategy to sustain sales in the United States amid the expiration of federal electric vehicle (EV) tax incentives.

The automaker’s new program allows customers to rent vehicles directly from Tesla stores, bypassing third-party rental services like Hertz.

The initial rollout is available at Tesla’s San Diego and Costa Mesa locations, with the company planning to expand to additional stores before the end of the year. Rentals range from three to seven days, with daily rates starting at $60, depending on the vehicle model selected.

Tesla Opens Short-Term Rentals

This MOVE comes at a pivotal moment for the EV market. Federal incentives, such as the New Clean Vehicle Credit, which offers up to $7,500 for new EV purchases, have ended for vehicles acquired after September 30, 2025.

While rental customers cannot claim these credits, Tesla’s short-term program allows potential buyers to experience the vehicles over multiple days before deciding to purchase.

This extended test-drive approach aims to offset waning demand caused by the loss of tax credits.

🇺🇸 TESLA LAUNCHES NEW RENTAL PROGRAM WITH FREE FSD AND SUPERCHARGING

Tesla’s new rental program lets you borrow a car for 3–7 days starting at just $60/day. No gas, no mileage limits, no strings (except state lines).

Each rental includes free Supercharging and Full Self-Driving… https://t.co/Yk1zD0NG9a pic.twitter.com/rZvrigTwVC

— Mario Nawfal (@MarioNawfal) November 10, 2025

Rentals Include FSD And Supercharging

Tesla’s rental program is designed to showcase the brand’s technological features. All rentals include free access to Tesla Superchargers, as well as supervised use of the Full Self-Driving (FSD) package.

This gives renters a firsthand experience of Tesla’s advanced automation capabilities, potentially boosting interest in future purchases. By providing these perks, Tesla differentiates its offerings from traditional rental services and emphasizes the value of its proprietary technology.

In addition to hands-on vehicle access, Tesla is offering a $250 credit toward the purchase of a vehicle if renters decide to buy. Although this represents only a fraction of the $7,500 federal tax incentive, it serves as a strategic nudge, encouraging conversions from renters to buyers. The initiative signals Tesla’s commitment to maintaining customer engagement in a post-incentive market.

Expansion Plans Across California

Tesla’s entry into short-term rentals also represents a broader trend in OEM-managed rental fleets. The automaker relies on purpose-built software and telematics to manage bookings, payments, and vehicle monitoring across multiple locations.

These systems differ from traditional dealership loaner programs, providing real-time vehicle data and remote management tools. B2B software vendors and investors could find opportunities in these OEM rental channels as Tesla and other manufacturers seek closer customer relationships and richer data insights.

With this strategic expansion, Tesla is positioning itself to maintain momentum despite policy shifts affecting EV incentives. By combining innovative rental services with advanced features and purchase credits, Tesla is creating new touchpoints with consumers, potentially transforming short-term rentals into long-term ownership.