Tesla's $100,000 EV refund due to defect

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【Summary】Tesla New Zealand has been ordered to refund a customer $104,643 for a faulty Model 3 Performance vehicle. The car had a recurring wheel alignment issue, with multiple assessments and repairs over nine months. Initially denying any faults, Tesla was found to have failed to meet the standard of "acceptable quality" by the Motor Vehicles Disputes Tribunal. The refund includes the customer's deposit and finance repayments, totaling $22,112.82.

FutureCar Staff Aug 21, 2023 4:18 PM PT

Tesla's $100,000 EV refund due to defect

The Tesla Model 3 was once the most popular new EV in New Zealand, but it was overtaken by its Model Y sibling last year.

A Tesla owner in Waikato has recently won a legal battle with Tesla New Zealand. The Motor Vehicles Disputes Tribunal found that the owner's Tesla Model 3 Performance, which cost $104,643, had a recurring wheel alignment issue. Over a period of nine months, the vehicle underwent six wheel alignment assessments, including repairs to the subframe.

Initially, Tesla New Zealand denied that the vehicle had any underlying faults. However, the tribunal adjudicator, Brett Carter, determined that the vehicle did not meet the threshold of "acceptable quality." As a result, Tesla New Zealand is required to issue a full refund to the owner. In addition, they must take back the vehicle, assume the customer's obligations with their finance company, and compensate the customer's company for the deposit and finance repayments, totaling $22,112.82.

Shaun Baker, the owner of the Model 3, purchased the vehicle in August 2022 for $104,643. On the day he collected the car, Baker noticed that it would tend to "pull right" while driving. He immediately returned to Tesla, who assessed and serviced the vehicle at their Auckland service centre. They performed a wheel alignment to correct the issue.

However, according to tribunal documents, Baker reported that the problem persisted. In November 2022, he returned to Tesla for another assessment. Once again, Tesla adjusted the wheel alignment, but the issue resurfaced later that month.

Baker had to take the car back to Tesla once again, and this time, a more significant repair was performed. The car's front subframe was adjusted to make the wheelbase left/right identical and to bring the adjustments closer to the median specification. Tesla believed that this fix resolved the problem.

Unfortunately, the issue persisted, and in February of this year, a Tesla mobile mechanic confirmed that the car's rear toe was outside of specification. Despite attempts to fix the issue, Baker took the car to a third-party group for a separate assessment. They found that the car drifted to the right, even though the steering wheel was level, and constant pressure had to be applied to the left side of the steering wheel to keep the car in a straight line.

Baker rejected the vehicle and sent an email to Tesla New Zealand, but the company denied the claims, stating that they found no faults with the vehicle. Tesla suggested that the issues may be related to the vehicle's steering compensation system, which adjusts the steering based on driving style and road conditions.

After a post-hearing test drive by an independent party and another vehicle alignment report, it was determined that the car still steered to the right on flat road surfaces. The tribunal's assessor found no evidence of a chronic or abnormal wheel alignment problem with the car.