To repair, or not to repair? That is the question facing many broken Teslas.
The EVs are currently so expensive to fix that many top insurance companies are writing off low-mileage models and sending them to salvage auctions, according to a recent Reuters analysis.
Of more than 120 crashed Model Ys that were totaled and then put up for auction in December and early January, the vast majority had fewer than 10,000 miles on the odometer, according to online data from auction houses Copart and IAA.
Insurers typically total a car—that is, scrap it and reimburse the owner—when the estimated cost of repair is higher than the actual cash value of the vehicle. The retail prices of the aforementioned rides, which were all 2022 or 2023 models, ranged from roughly $60,000 to more than $80,000. Some estimated repair costs sat just under that, according to Reuters.
For example, a 2022 Model Y Long Range that was involved in a front collision and listed by IAA in early January had a retail price of $61,388 and an estimated repair cost of $50,388. Another Model Y that suffered a side collision had a retail price of $72,667 and an estimated repair cost of $43,814.
During Tesla’s fourth-quarter earnings call on Wednesday, CEO Elon Musk said the automaker is making changes to vehicle design and software to lower repair costs and premiums. With such technologically advanced EVs, even minor bumps and scrapes can cost a fortune to fix.
“It’s remarkable how small changes in the design of the bumper (and) providing spare parts needed for collision repair have an enormous effect on the repair cost,” Musk explained. “Most accidents are actually small—a broken fender or scratched side of the car.”
The CEO added that premiums from third-party insurance companies “in some cases were unreasonably high.” He said the company was trying to counter that by offering lower rates to Tesla owners. To recap, Tesla launched its own insurance arm in August 2019, promising rates up to 30 percent lower than competitors.
Costly repairs and premiums haven’t hampered Tesla’s popularity, though. It was the best-selling EV and luxury car maker last year. It also posted nearly $3.7 billion in profits and $24.3 billion in sales for the last quarter of 2022. That’s a 59 percent increase and a 37 percent increase, respectively, from the year prior. That’s certainly something Musk can smile about.
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Rachel Cormack
Digital Editor
Rachel Cormack is a digital editor at Robb Report. She cut her teeth writing for HuffPost, Concrete Playground, and several other online publications in Australia, before moving to New York at the…
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FAQs
Insurers are increasingly concluding that a broken Tesla is too expensive to fix. There were 120 Tesla Model Y electric vehicles listed in two large salvage auction houses recently, and the "vast majority" had under 10,000 miles on them, according to a report from the Reuters news service.
Are Teslas expensive to repair after an accident? ›
Tesla repair costs are $1,347 more than the average car repair. Insuring a Tesla can be up to 48% higher than other vehicles. Shop around for car insurance or adjust your coverage to make it more affordable.
Are Teslas expensive to get fixed? ›
Tesla maintenance can be low, but the combined cost of maintenance and repairs are high compared to the industry average.
Can a crashed Tesla be fixed? ›
Tesla Service Centers can perform collision repairs, from paint scuffs or scratches to minor dents in bolt-on body panels.
Can a Tesla be totaled? ›
In some states, a vehicle may be a total loss if the repair costs exceed a percentage of the vehicle's value. Your Tesla Claims Adjuster will help determine if your vehicle is a total loss and will serve as your primary contact for questions or concerns.
Can a regular body shop fix a Tesla? ›
Protect Your Factory Warranty
If you choose to get your Tesla repaired at a non-certified auto body shop, it can potentially void your factory warranty. This is because non-certified shops may not have the required expertise, knowledge, or equipment to complete the repairs as per Tesla's guidelines.
Who is liable if a Tesla crashes? ›
Tesla IS the manufacturer. Tesla FSD is not yet fully autonomous. The driver (and more accurately, the driver's insurance company) is currently just as responsible for an at-fault accident when using FSD as when not using it.
Do Teslas lose value over time? ›
Specifically, the study shows that Tesla models are losing value almost 30% year-over-year.
Will a Tesla last a lifetime? ›
What is the life expectancy of a Tesla car? The life expectancy of a Tesla car can vary, but many Tesla owners report their vehicles lasting well over a decade with proper maintenance. Tesla's battery and drive unit warranty usually spans 8 years or a specified mileage limit, which can offer a useful guideline.
What happens if a Tesla is in an accident? ›
In the event of an accident, the pyro fuse of the high-voltage contactor can trigger and disconnect the high-voltage battery from the vehicle. This is an important protective mechanism to protect the vehicle and its occupants from further damage caused by the high-voltage battery.
While Tesla vehicles are equipped with advanced safety features and have achieved high safety ratings in crash tests, accidents can still occur due to various factors beyond the control of the vehicle manufacturer. This does not take away from the technology in place to keep the car's occupants as safe as possible.
Can you sue Tesla autopilot crash? ›
To establish liability in a lawsuit against Tesla for an Autopilot car accident, the plaintiff (i.e., the injured party) would need to demonstrate that Tesla's negligence or failure to meet its legal obligations was a proximate cause of the accident and resulting damages.
Why do Tesla cars get totaled so easily? ›
Tesla's cars are tremendously complex, with a multitude of sensors and custom body parts. That makes them extra difficult to repair in the event of a crash. Insurers are increasingly declaring Tesla cars totaled in an accident instead of paying for a fix.
Is insurance high on Tesla? ›
The average cost to insure a 2022 Tesla model with full coverage is $3,007 annually or $251 per month, which is 50% higher than the national average. Many Tesla owners choose to purchase third-party protection for their Teslas rather than opting for the company's own coverage.
Do Teslas breakdown a lot? ›
J.D. Power and Consumer Reports both rank Tesla at the bottom of the pack when reliability is tested. It's reported that Tesla vehicles have an average of 171 mechanical issues per 100 vehicles. For reference, the average number for most automakers hovers around 120 problems per 100 vehicles.
Does Tesla warranty cover accidental damage? ›
Despite the breadth of this warranty, damage resulting from intentional actions (including intentionally abusing or destroying your vehicle or ignoring active vehicle warnings), a collision or accident (excluding from Battery fires as specified above), or the servicing or opening of the Battery or Drive Unit by non- ...
Are Tesla's good in accidents? ›
According to this study conducted by Lending Tree, Tesla drivers rank number 1 for highest accidents rate, among only 3 car brands that had a rate over 20%. Other car brands that ranked high on the list include Ram, Subaru, and Mazda.
Do Teslas have a lot of repairs? ›
With no regularly required maintenance and fewer moving parts to repair, we design every Tesla vehicle with the goal of eliminating the need for service. Paired with remote diagnostics and over-the-air software updates that regularly improve your car, you'll spend less time in the shop and more time on the road.
