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Business

Tesla partner with Manheim, Adesa to manage used cars




To manage a growing used car business, Tesla is relying on outside companies, including Manheim and Adesa, according to two people familiar with the situation.

As it has dismantled vehicle production and sales , Tesla has been grappling with what CEO Elon Musk called "delivery logistics hell." A burgeoning volume of used cars poses yet another operational challenge to Tesla, while also giving the company new revenue streams and a way to bring electric vehicles to the masses.

This move is something of a departure for Tesla, which operates as a "vertically integrated" business that sells its new cars direct-to-consumer, provides repair services through its own service centers, and manufactures parts of its cars that most Auto-makers do not attempt to, including its own batteries, car seats, and chips that power Tesla Autopilot features.

Tesla is handling a higher volume of used cars than ever before, partly because it offered a 2- year lease option for it s Model S and Model X electric vehicles back in the third quarter of 201[ads1]6, and 3-year leases before that.

One Tesla employee involved in the growing used car operation said around half of the Tesla vehicles that go to its partners come back retail-ready, waardoor Tesla kan verkopen als gecertificeerde pre-owned voertuigen, of om ze als leners en werknemerswagens meteen te gebruiken. Its partners sell some of the other Tesla vehicles through physical and online wholesale auctions.

Most of what Tesla sends off to its partners are Model S and Model X cars coming off lease, but others are trade-ins (including some made by other car makers), lemons, or cars repossessed after non-payment, people familiar said. Tesla's used car inventory has barely begun to include Model 3s.

Recent job listings posted online by Tesla to its careers page and Glassdoor.com, including listings for a Used Vehicle Quality Specialist, Remarketing Manager, Used Vehicle Sales Advisor and others- , reveal at the company is targeting a "30-day or less turn-rate in the sale of pre-owned inventory." The job listings also acknowledge that Tesla is working with third party vendors on "timely and high quality repairs."

Manheim, which is a division of Cox Enterprises, and Adesa, which is part of Kar Auction Services, both declined to comment citing client confidentiality. Tesla also declined to comment.



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