Log in
Log in
Or log in with
GoogleGoogle
Twitter Twitter
Facebook Facebook
Apple Apple     
Sign up
Or log in with
GoogleGoogle
Twitter Twitter
Facebook Facebook
Apple Apple     
  1. Homepage
  2. Equities
  3. United States
  4. Nasdaq
  5. Tesla, Inc.
  6. News
  7. Summary
    TSLA   US88160R1014

TESLA, INC.

(TSLA)
  Report
Real-time Estimate Cboe BZX  -  11:46:37 2023-03-28 am EDT
188.76 USD   -1.59%
10:55aTesla Model X Vehicles Faces US Probe Over Reported Front Seat Belt Failures
MT
10:28aNo more diesel and gasoline: EU adopts climate targets for new cars
DP
09:30aSome improvement, but let's not get ahead of ourselves
MS
SummaryQuotesChartsNewsRatingsCalendarCompanyFinancialsConsensusRevisionsFunds 
SummaryMost relevantAll NewsAnalyst Reco.Other languagesPress ReleasesOfficial PublicationsSector newsMarketScreener Strategies

Tesla, insurers take different paths to deal with expensive repairs

01/26/2023 | 04:37pm EDT
FILE PHOTO: Tesla hands over first cars produced at new plant in Gruenheide

(Reuters) - Tesla Inc's electric vehicles are expensive to repair - so much so that the automaker and insurers are addressing the issue in sharply different ways.

Chief Executive Elon Musk says Tesla is making design and software changes to its vehicles to lower repair costs and insurance premiums.

Insurance carriers, meanwhile, are writing off low-mileage Tesla Model Ys that have been in crashes, and sending them to salvage auctions after deeming many too expensive to repair.

During Tesla's fourth-quarter earnings call on Wednesday, Musk said premiums from third-party insurance companies "in some cases were unreasonably high" and that the EV maker's insurance arm was putting pressure on those carriers by offering lower rates to Tesla owners.

Musk also said "we want to minimize the cost of repairing a Tesla if it's in a collision," citing changes to vehicle design and software.

"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," he said. "Most accidents are actually small -- a broken fender or scratched side of the car."

Tesla did not respond to a request for further comment.

So far, Tesla's reputation for expensive vehicle repairs does not seem to have dampened demand, which Musk says is running well ahead of the company's ability to produce.

SALVAGED

The data on crashed low-mileage Teslas showing up at auction presents a slightly different - and previously unreported - picture, according to a Reuters analysis.

Of more than 120 Model Ys that were totaled after collisions, then listed at auction in December and early January, the vast majority had fewer than 10,000 miles on the odometer, according to online data from Copart and IAA, the two largest salvage auction houses in the United States.

The retail prices of those cars ranged from about $60,000 to more than $80,000.

Copart and IAA auction listings note whether the vehicles were involved in front, rear or side collisions, and typically include after-crash photos of each vehicle. But the listings do not disclose specific details on the type of damage suffered.

Insurance companies typically "total" a vehicle - that is, choose to scrap it and reimburse the owner - when the estimated cost of repair is deemed too high.

Copart listings in some cases included the names of insurance companies that had bought back crashed vehicles, then listed them at auction. Those companies include State Farm, Geico, Progressive and Farmers. Geico is part of Warren Buffet's Berkshire Hathaway Inc.

Insurance companies contacted by Reuters either declined to comment or did not respond immediately to requests.

LOW MILEAGE

Tesla launched its own insurance affiliate in August 2019, promising rates up to 30% lower than competitors.

During Wednesday's earnings call, Chief Financial Officer Zachary Kirkhorn said Tesla Insurance at year-end was generating premiums at an annual rate of $300 million and growing at a quarterly clip of 20% - "faster than the growth in our vehicle business."

All the Model Ys in the Reuters analysis were 2022 or 2023 models, and were built at either the Fremont plant in Northern California or the Austin, Texas, plant.

Of the 15 Model Y Long Range vehicles built in Austin from June through November and sent to auction after being totaled in crashes, all but one had fewer than 10,000 miles on the odometer.

An Austin-built 2022 Model Y Long Range involved in a front collision and listed by IAA in early January had a retail price of $61,388 and estimated repair cost of $50,388. The vehicle's owner was not listed.

A second Austin-built Model Y, involved in a side collision and listed by IAA, had a retail price of $72,667 and estimated repair cost of $43,814.

Representatives from Copart and IAA were not immediately available for comment.

(Reporting by Paul Lienert in Detroit; Editing by Matthew Lewis)

By Paul Lienert


ę Reuters 2023
Stocks mentioned in the article
ChangeLast1st jan.
BERKSHIRE HATHAWAY INC. 0.01% 458205.25 Delayed Quote.-3.34%
COPART, INC. 0.52% 73.2 Delayed Quote.19.44%
TESLA, INC. -1.38% 189.1969 Delayed Quote.55.72%
All news about TESLA, INC.
10:55aTesla Model X Vehicles Faces US Probe Over Reported Front Seat Belt Failures
MT
10:28aNo more diesel and gasoline: EU adopts climate targets for n..
DP
09:30aSome improvement, but let's not get ahead of ourselves
MS
07:26aU.S. agency opens probe into 50,000 Tesla Model X vehicles over front seat belts
RE
06:52aSocial Buzz: Wallstreetbets Stocks Mixed Premarket; First Republic Bank Pois..
MT
06:47aUS opens investigation into Tesla seat belts coming loose
AQ
06:18aNorth American Morning Briefing: Stock Futures Steady as..
DJ
05:54aEuropean Midday Briefing: Stocks Gain Again as Bank Sector Stre..
DJ
05:04aHome battery sales in Germany may surge 59% this year -study
RE
12:36aEU states vote on the future of cars with combustion engines
DP
More news
Analyst Recommendations on TESLA, INC.
More recommendations
Financials (USD)
Sales 2023 102 B - -
Net income 2023 12 472 M - -
Net cash 2023 26 095 M - -
P/E ratio 2023 53,4x
Yield 2023 -
Capitalization 607 B 607 B -
EV / Sales 2023 5,67x
EV / Sales 2024 4,26x
Nbr of Employees 127 855
Free-Float 83,5%
Chart TESLA, INC.
Duration : Period :
Tesla, Inc. Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends TESLA, INC.
Short TermMid-TermLong Term
TrendsNeutralNeutralNeutral
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 36
Last Close Price 191,81 $
Average target price 209,03 $
Spread / Average Target 8,98%
EPS Revisions
Managers and Directors
Elon Reeve Musk Director
Zachary J. Kirkhorn Master of Coin & Chief Financial Officer
Robyn M. Denholm Chairman
Ira M. Ehrenpreis Independent Director
James Rupert Murdoch Independent Director
Sector and Competitors
1st jan.Capi. (M$)
TESLA, INC.55.72%606 907
LI AUTO INC.13.77%22 674
LUCID GROUP, INC.19.18%14 894
NIO INC.-8.41%14 756
RIVIAN AUTOMOTIVE, INC.-27.78%12 340
XPENG INC.-2.31%8 325
Secure and increase the performance of your investments with our team of experts at your side.
Securing my Investments
fermer