Tesla Launches Trade-In Incentives and Low-Interest Loans for New Model Y in U.S. and China

Tesla is rolling out a major promotional campaign in the U.S. and China to encourage current Model Y owners to upgrade to the newly launched version of the SUV. This move comes amid Tesla’s efforts to recover from production line changes that impacted its first-quarter delivery numbers and to stay on track with its ambitious annual sales goals.

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In the U.S., Tesla is offering a $2,000 trade-in discount to existing Model Y owners who switch to the updated model. The offer accompanies additional financial incentives, including a low 1.99% APR financing rate or a zero-down payment option—effectively giving buyers an indirect discount worth several thousand dollars. These offers are designed to accelerate the adoption of the new Model Y, which has already launched in key markets like China, Europe, and North America.

China is also seeing aggressive promotions. Tesla has introduced a zero-interest loan plan for the new Model Y, valid through June 30. Buyers can secure the vehicle with a down payment of ¥79,900 and monthly installments starting at approximately ¥3,060. Tesla is simultaneously offering an ¥8,000 insurance subsidy on the Model 3 series, with certain variants also eligible for five-year zero-interest loans, reducing monthly payments to as low as ¥2,460.

The new Model Y features several enhancements over its predecessor. It now comes equipped with double-pane acoustic glass, offering a quieter cabin experience, and an optimized suspension system that improves ride comfort. The vehicle’s body has been subtly redesigned to improve aerodynamics, while refinements like quieter door closure sounds enhance overall build quality.

Despite ongoing market concerns around electric vehicle demand, Tesla continues to attract a strong base of potential buyers. Its Q1 delivery shortfall was partly due to a weeks-long production pause during factory upgrades. However, 2025 remains a pivotal year for the company, with the anticipated launch of its Robotaxi ride-hailing service and a more affordable Tesla model expected to debut.

By offering tailored incentives across multiple regions, Tesla is signaling its intent to stay aggressive in both retention and expansion—bolstering its customer base while keeping its innovation pipeline moving forward.