Business

Tesla Exaggerated Its Cars’ Driving Range—And Canceled Service Appointments If Drivers Complained, Report Says

July 29, 2023

Topline

Leading electric car manufacturer Tesla programmed its dashboards to exaggerate how far the vehicles can drive on a single charge, and canceled service appointments for customers who noticed their cars’ range was shorter than expected, a report by Reuters found Thursday—the latest Tesla feature to face scrutiny.

Tesla Model Y full electric crossover SUV on dsipaly at Brussels Expo on Jan. 13, 2023 in Brussels, … [+] Belgium. Photo by Sjoerd van der Wal

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Key Facts

Tesla programmers rigged the cars’ range-estimating software to exaggerate how far they could go without running out of battery and then, when charge on the battery fell below 50%, readjust to a more realistic projection, one Tesla employee told Reuters—an idea that came directly from CEO Elon Musk himself.

The range estimates that appear on the dashboard ignored external factors like weather—extreme hot or cold temperatures can dramatically impact how far electric cars travel—as well as hilly terrain, headwinds or running the air conditioning, Recurrent Auto CEO Scott Case told Reuters, citing data analyzed by his company.

When customers noticed their range wasn’t matching the dashboard estimates and called the company to make service appointments, Tesla employees would follow directives to tell customers they’d performed “remote diagnostics” and cancel the appointment, the report said.

The company reportedly went as far as to create an entire Las Vegas-based “diversion team” devoted to quieting customer complaints about the inaccurate range, a group that was told by managers it saved Tesla $1,000 for every appointment it canceled.

Tesla did not immediately respond to Forbes’ request for comment.

What We Don’t Know

It’s unclear if the faulty algorithms are still being used for range estimates, Reuters said, but the company has been flagged several times for lying about vehicles’ range, including by the South Korean government, which fined Tesla $2.2 million earlier this year for exaggerating range by as much as 50%.

Key Background

The inaccurate projections have been going on for years, Reuters said, and started at a time Tesla was selling only two models, the now-discontinued two-door Roadster and the Model S, a luxury sport sedan. Tesla now sells four models—the Model S, Model 3, Model X and Model Y—and has several others in the works, including the Cybertruck and Roadster 2.0. Estimated range isn’t the only dashboard warning that customers say is unreliable. Tesla owners have complained that warning lights are fickle and will come on when there isn’t a problem, or don’t actually come on when there is something wrong. Other issues have included complaints that steering wheels can come off while driving and the cars break for no reason and, earlier this month, faulty seat belts led to the recall of 15,000 cars. Tesla has also drawn scrutiny for its Autopilot system after several cars were involved in accidents, and after an engineer said a self-driving demo video was staged.

Tesla Supercharger at the Burbank Town Center Thursday, Feb. 16, 2023 in Burbank, CA. Photo by Gary … [+] Coronado

Los Angeles Times via Getty Images

Forbes Valuation

We estimate Musk’s net worth at $239.3 billion, making him the richest person in the world.

Tangent

A fear of running out of battery power without access to a charger has been cited as a major hurdle for electric vehicles: There are about a third as many charging stations in the U.S. as gas stations, according to NPR, and those chargers are significantly harder to find in rural areas. It also typically takes longer to charge an electric vehicle than to refuel a gas-powered vehicle. Cars not having enough driving range to make it from one charger to another in some parts of the country remains a tough selling point for many would-be adopters, but carmakers are working to increase range and add chargers. Tesla’s charging standard is largely seen as the best on the market and several other car manufacturers have signed on to adopt it including Mercedes-Benz, General Motors, Ford, Rivian and Nissan, giving their cars access to Tesla’s network of 45,000 fast chargers. On Wednesday, a group of seven automakers said they are coming together to build their own network of fast chargers that will double the number available in the U.S. and Canada. GM, BMW, Mercedes, Honda, Hyundai, Kia and Stellantis aim to install at least 30,000 fast charging stations across the continent by 2030, which will be open to all electric vehicle owners using either the Tesla charging standard of the Combined Charging System.