John Goreham's picture

Update - Tesla for Bitcoin story not accurate

A Lamborghini dealer in California is reporting that it sold a presumably used Tesla Model S in exchange for virtual currency. A cool story. Unfortunately, not really true.
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Last week we reported that a used Tesla Model S had been purchased by a customer from a Lamborghini dealership in California. Instead of currency, the vehicle was (reportedly) paid for in Bitcoin according to the dealership’s website posting. Bitcoin is a virtual currency. It was invented about 4 years ago and it is very volatile currency. According to Forbes it is presently in a “bubble.” Meaning its value if over-rated at this time.

Update - CNBC reports now that according to the general manager of the dealership "The transaction in our bank account, we received a wire in U.S. dollars, so you could say that I didn't want bitcoins. And I never touched bitcoins." He went on to say "It's like if you come into the dealership and you want to buy a Lamborghini using gold bars. We will not accept that. We will accept U.S. dollars. You go out. You exchange it. You come back to us. That's how it worked."

Interestingly, this is one of the first stories we have heard about a used Tesla Model S as well. Tesla sells direct. It has opted not to use dealerships and that choice has led to serious difficulties in some states such as Texas. One thing we have been wondering is if dealers will accept Teslas as trade-ins. Apparently they will accept one as a trade in for a Lamborghini or other used car at a Lamborghini dealership because the website of the dealer noted it was “in inventory.”

The US government does not like competition in the area of inflated currencies with dubious value. For that reason it has shut down organizations in the past that have invented currencies. In an unrelated news story yesterday, USA today quoted Bank of America as saying “the virtual currency could become a "serious competitor" to traditional money transfer providers.” In China the government run banks are also looking closely at how Bitcoins can and should be regulated and allowed as currency.

The new Tesla Model S has a starting price someplace in the $75,000 range. That is however not its typical price point based on our observations of test cars, customer cars, and cars we have seen at the Tesla Store. Typically, Tesla Model S cars retail new for approximately $100,000. Buyers with this kind of spending power are rewarded with a $7,500 federal tax credit, and most states also allow other tax benefits such as no sales tax and further income tax credits.


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Comments

"The US government does not like competition in the area of inflated currencies with dubious value." Well put.