Can You Legally Transfer or Sell a Tesla Model 3 Reservation?

The process of transferring or selling a Tesla Model 3 reservation can be complicated, especially when it comes to legal boundaries. In California and other states, the reservation agreement terms are strict, stating that reservations cannot be transferred or assigned without Tesla's prior written approval. This article aims to clarify the conditions and processes involved in transferring or selling a Tesla Model 3 reservation.

California State Law and Transferability

One workaround for transferability in California involves titling the vehicle under two names during the final paperwork stage. For example, one might title the car under both Jim T. and Bill C. names. Either party can subsequently make changes to the title once the vehicle is in their possession, thanks to the "or" verbiage in the title. Jim can reserve the car, while Bill can choose the options and color. Once the vehicle is obtained, Bill can then change the title to reflect only his name. A Tesla representative confirmed that they would not prevent such actions, making this method highly likely to work in California.

However, this workaround is not always applicable in other states. It is important to consult local laws and regulations to ensure the process aligns with state-specific requirements.

Non-Transferable Nature of Reservations

The non-transferable nature of a Tesla Model 3 reservation is emphasized in the company's terms of service. Titled in section 4 of the reservation agreement, it clearly states that your reservation payment will not be held in an escrow or trust fund and that your reservation is not transferable or assignable without Tesla's prior written approval. This non-assignability provision is a common feature in contracts, as it ensures full knowledge and control of the counter-party involved in the agreement.

My professional experience in reviewing legal agreements suggests that such non-assignability clauses are standard, especially in cases where one party may desire to change the counter-party due to external factors such as a corporate acquisition, which would often require the other party's consent. A clause that states "such consent will not be unreasonably withheld" is frequently included, but that specific language is absent in the Tesla reservation agreement.

Unique Circumstances for Transfer

Based on the terms outlined in the Tesla reservation agreement, the transfer of a reservation would be highly unlikely under normal circumstances. The conditions under which a reservation might be successfully transferred would likely have to be quite unique and compelling, such as the death of a family member holding the reservation.

For those interested in the full reservation agreement, it is available for viewing on the Tesla website.

While the article does not provide legal advice, it is essential to consult with legal professionals or local authorities if you are considering transferring or selling a Tesla Model 3 reservation. Understanding the legal requirements and processes is crucial to ensure a smooth and lawful transition.