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Tesla Admits Defeat, Quietly Settles Model X Lawsuit Over Usability Problems (bgr.com) 129

Posted by BeauHD from the quality-control dept.
An anonymous reader quotes a report from BGR: We can talk about how innovative Tesla is for days on end. Indeed, there's no disputing the fact that the company, in injecting a bit of Silicon Valley ingenuity into the tried and true auto design process, has completely turned the auto industry on its head. At the same time, Tesla helped kickstart the EV revolution, even causing traditional automakers like Porsche and BMW to start taking electric cars more seriously. But in Tesla's zeal to move extraordinarily quickly, problems have inevitably begun to creep in. Specifically, quality control issues still seem to be plaguing the Model X. According to a recent report, avowed Tesla fan named Barrett Lyon recently returned his Model X and filed a lawsuit against Tesla arguing that the Model X was "rushed" and released before it was ready for sale. Now comes word that Tesla has since quietly settled the lawsuit. "In Lyon's lawsuit," Fortune writes, "he claimed the cars doors opened and closed unpredictably, smashing into his wife and other cars, and that the Model X's Auto-Pilot feature posed a danger in the rain. He also shared a video that shows the car's self-parking feature failing to operate successfully." Tesla's response: "We are committed to providing an outstanding customer experience throughout ownership. As a principle, we are always willing to buy back a car in the rare event that a customer isn't completely happy. Today, the majority of Model X owners are loving their cars."
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Tesla Admits Defeat, Quietly Settles Model X Lawsuit Over Usability Problems More

Tesla Admits Defeat, Quietly Settles Model X Lawsuit Over Usability Problems

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  • Shitty refund policy (Score:5, Insightful)

    by mewsenews ( 251487 ) on Wednesday June 29, 2016 @06:33PM (#52416775) Homepage

    Sounds like the guy had to file a lawsuit to attain or expedite a refund, which sucks.

    Notice the weasel language from the rep: "we'd be happy to buy back any unsatisfactory vehicles", not refund. Have to wonder if that means they will only refund market value of a used car.

    • Re:Shitty refund policy (Score:5, Interesting)

      by LordKronos ( 470910 ) on Wednesday June 29, 2016 @06:45PM (#52416849)

      If you could return the car brand new in the shinkwrap, never used, then perhaps a refund might make sense. But cars suffer wear and tear. The guy could have driven over a series of speed bumps at 30-40 miles an hour, doing significant damage that maynot yet be evident under a typical inspection. Plus already having an owner on the title affects value, and possibly even the next owner's ability to finance it as new rather than used. I don't think it's reasonable to expect a full refund, but I agree that "buy buy" is probably pretty misleading for the vast majority of customer.

      Also, the reason he had to file the lawsuit is that he probably did want a full refund, rather than the buy back which surely was in the contract he signed (we can't go understanding what we signed, now can we).

      Also, interesting thing about the guy's auto-park-fail video. First, he never shows us what's inside the garage, so who know what might be obstructing the cars path. 2nd, you notice the car stops it's autopark the very second that his motion sensitive garage light turns on. That seems like a very interesting coincidence.

      • Re:Shitty refund policy (Score:5, Insightful)

        by stabiesoft ( 733417 ) on Wednesday June 29, 2016 @07:39PM (#52416997) Homepage

        Given the car had issues almost immediately, lemon law basically says full refund. A minuscule amount would be deducted for miles driven before the FIRST problem was reported. The guy had no ax to grind, he owned a roadster and an S. Tesla was just stupid not to deal with this when he first asked. But then they have had a couple of braindead PR moments.

      • Re:Shitty refund policy (Score:5, Interesting)

        by swb ( 14022 ) on Wednesday June 29, 2016 @08:55PM (#52417219)

        If you could return the car brand new in the shinkwrap, never used, then perhaps a refund might make sense.

        And how exactly will you know the car has problems if you basically need to have it trailered to a climate controlled storage facility in order to get a refund?

        The whole "depreciation once you drive it off the lot" mindset is kind of a self-perpetuating myth that seems to have nothing to do with the actual material value of a car. I've bought used cars with 20k miles on them that were indistinguishable from new cars cosmetically and in every way practically measurable without disassembly, in-depth chemical analysis or the use of a microscope and they were good for the next 110,000 miles (and going strong).

        I think the depreciation off the lot concept is a real economic phenomenon -- I've seen $110,000 cars mechanically perfect and guaranteed bumper-to-bumper for 3 years with 5500 miles on the odometer selling for $55,000. Yet it seems un-economic that somehow nearly half the value of the new car is lost somehow. Just who is absorbing that? Even assuming a 20% markup on the new car, *someone* is walking away from $40,000 after two months? Who, exactly, is eating a $40,000 real loss on this?

        My guess is that the depreciation concept is a financial gimmick that somebody (lenders, car dealers, car manufacturers, etc) is making money on by turning phantom material depreciation into tax deductions or some other non-real loss that becomes a financial gain.

        • I totally agree, especially in the light of the fact that a dealer can drive your 'new' car around for several hundred miles with no 'depreciation', but the instant the purchaser drives away the car is suddenly worth less ? If there was any real basis for that issue I'd demand a car with ZERO miles on it.

          • Re:dealer miles; test drive miles (Score:4, Interesting)

            by swb ( 14022 ) on Wednesday June 29, 2016 @11:48PM (#52417619)

            I'm inclined to believe there's some real psychological value to a "new" car with very few miles on it, like maybe 5% of the cost of the car but I think that number has been declining over time as cars have become more reliable and durable.

            If anything, cars with no diagnosable problems and something like 5-10,000 miles ought to be MORE valuable than a "new" car. They're still new from a wear and tear and lifespan perspective, but have been largely demonstrated to be free of faulty components and assembly and have more proven reliability than a car from the factory with 3/10 of a mile on the odometer.

            • but have been largely demonstrated to be free of faulty components and assembly and have more proven reliability than a car from the factory with 3/10 of a mile on the odometer.

              As a buyer, you do not know that.

              Also, as a used car buyer, you lose the ability to pick color, any extras, maybe even the engine is not the one you would have chosen yourself.

              • Re: (Score:2)

                by swb ( 14022 )

                As a buyer, you do not know that.

                Maybe not with a '79 Chevy you don't, but with any *modern* car you take it to a good mechanic and run an ECM diagnostic, compression test and look for any broken suspension components or evidence of repair and you'll know really well what kind of condition its in.

                Plus with any late model car (1-2 years old) it still carries the bulk of the factory warranty and most dealer-sold cars are certified and carry an extension of the factory bumper to bumper warranty. Unless its a total lemon (unlikely in my exper

                • Maybe not with a '79 Chevy you don't, but with any *modern* car you take it to a good mechanic and run an ECM diagnostic, compression test and look for any broken suspension components or evidence of repair and you'll know really well what kind of condition its in.

                  Not necessarily true. It's not terribly hard to hide many mechanical problems. And many problems can be "repaired" without leaving a shred of evidence. And even the best mechanic may not find every problem with a vehicle. Sure, some things are obvious but many aren't. Intermittent electrical problems are something I've dealt with on a few VW vehicles I've had but no mechanic would be likely to run into them. I've sold several cars that I considered to be unreliable but you'd never know it even with a

                  • Re: (Score:2)

                    by swb ( 14022 )

                    I guess it depends on the mechanic you use.

                    When I bought my Volvo, I sought an independent Volvo-specific shop. The car was "Volvo Certified" which meant it had been gone over by their people and as a lease return under warranty from that same dealership, they also had the complete service history of the car (which they printed out for me). Since it was a lease and under warranty, the previous owner had zero incentive to hide defects and since it had an additional 4 years of warranty (2+2) there was littl

                  • Like the '08 impala with 15k miles I test drove a few years back at a used car dealer. It idled at 2k RPMs when most impalas were in the 500-750 range. I thanked them for the test drive and haven't gone back to that dealer since then.

          • Because the dealer does this to relocate your car, so you have to trust him like you would trust a valet [youtu.be]. A private party reselling a car after only a year probably drove into a lake on it. If a significant share of buyers were sceptical of auto dealers then the dealers would never ever drive them, at the additional cost of having a truck shuttle new cars around.

          • I totally agree, especially in the light of the fact that a dealer can drive your 'new' car around for several hundred miles with no 'depreciation', but the instant the purchaser drives away the car is suddenly worth less ?

            The biggest reason for this is the problem of information asymmetry [wikipedia.org]. When the dealer sells you a "new" car, that carries certain warranties and guarantees of condition along with it. You can reasonably assume that the vehicle hasn't been used for drag racing and that even with a few tens of miles on it that it is for all practical purposes is as good as the factory can make it and you cannot find one in meaningfully better condition anywhere. The moment you drive it off the lot as a new owner all that in

        • A car looses 25% off resale price as soon as it drives off the lot. I agree that this is a standard heavily influenced by the old industry that demanded a fat dealer markup, but with advent of private selling websites the industry has less and less say in setting resale prices. The real reasons are as follows:
          • It is natural for people to want something shrink-wrapped from the factory
          • Did the previous owner change oil? Did he redline the engine? Submerged the car in water?
          • Is the car being sold before its time

          • If something is loose on a car, it should get tightened. Did you perhaps mean lose?

          • A car looses 25% off resale price as soon as it drives off the lot. I agree that this is a standard heavily influenced by the old industry that demanded a fat dealer markup

            I completely disagree, and I can prove it.

            Go buy a brand-new car. Now, go resell that vehicle on Craigslist. No dealer involved. You're not going to get close to the brand-new price for that car.

            Resale price is what someone is willing to pay for the car, that's it. Dealer trade-in prices are lower because they have to make a profit, b

            • Last time we bought a car, we basically signed up for a 5-year loan at a trivial interest rate. Paying the car off would have been the wrong thing to do financially, since the interest rate is much below what we get on investments. That loan has a certain value in itself, and you're not getting those terms in a private resale.

              • Yep, that's exactly what I have, a 0.9% interest rate loan for 5 years. You can't buy a used car with that kind of rate.

            • This is exactly what I said, there was no need for drastic measures such as "completely disagree". However, used car dealers are still major player on the market and as such indirectly affect the prices set by private parties. For example, you cannot sell a car on Craigslist for more than asked by the dealer around the corner, because the dealer also provides a 2 month warranty, etc. As such the dealers indirectly steer the prices set on Craigslist.

        • Re: (Score:2)

          by AmiMoJo ( 196126 )

          Finance deals are responsible for some of it. The finance company can take a big hit on the value of the car after a couple of years because they made money on the loan. Their business relies on quickly selling the car and they aren't really interested in running a garage or making much effort to increase the vehicle's value, so they tend to go via auction at dealer prices and buyer-beware levels of risk.

          Dealers are to an extent the same. If they have a year old demo car with a few thousand miles on it they

          • Re: (Score:2)

            by swb ( 14022 )

            I've seen the largest depreciation on luxury cars and I'd guess that this large delta makes depreciation losses into something of a business niche itself with some complex buy-sell-lease-sell arrangement that allows the the depreciation writeoff and a high lease expense to be taken as deductions by two separate companies owned by one person which works to negate the real loss.

        • I was the third owner of a BMW. First owner paid about $50,000 and drove 24,000 miles in two years. He sold it for $25,000 to the second owner, who drove 28,000 miles in two more years and sold it for $15,000 to me. I drove it 8 more years and sold it for $1800 with 240,000 miles on the clock. I would have got more except the tranny was beat and it had to get towed away. So....looks like the first owner got boned hard - real hard!

        • Where'd you see a 110k car with 5000 miles selling for 50k??

        • I think you're missing something pretty significant.

          Depreciation on a car reflects the lower market value of a used car.

          The reason your $110K car only sells for half the price after 3 years and a paltry 5500 miles is because if you're a rich person who can afford a $110K car, why on earth would you want to save 10% and get a used car? If you can afford a $110K car, you're not going to care much about saving $11K. This is why luxury cars depreciate so much faster than regular cars. $20K-30K cars don't dep

          • Re: (Score:2)

            by swb ( 14022 )

            Since I posted my first post in this topic, I talked to someone I know in the car business and asked him, how, exactly, that car (BMW 750Li) could be sold in that condition for that asking price, and who was eating $40k on the deal, if anyone was really eating $40k.

            His thought was that the car was bought deeply discounted to begin with -- list is $110k, but he said if the model in question is slow moving the dealer themselves will get an additional 10% from the ~18% margin they're working with, so the car p

        • " I've bought used cars with 20k miles on them that were indistinguishable from new cars cosmetically and in every way practically measurable without disassembly"

          You answered your own question in the last part. Yes, a car with 20,000 miles might look new, and be functionally intact. Realistically, you don't know what's happened since it left the lot. It's actually not all that hard to replace certain parts of a car to hide damage from a vehicular accident, but that accident could leave other issues that wil

        • Re: (Score:2)

          by ed1park ( 100777 )

          I suppose you can liken it to taking a girls virginity. :)

      • He said there were failures in the car that went beyond it being undrivable, that it already damaged other cars. I would demand compensation for that, leasing a replacement new car for the amount of time it took the lawsuit to be resolved, legal fees, plus a punitive damage, all on top of a full refund for the car.

        he reason he had to file the lawsuit is that he probably did want a full refund, rather than the buy back which surely was in the contract he signed (we can't go understanding what we signed, now

  • downside of "fail fast"? (Score:1)

    by Anonymous Coward

    So this Valley Girls fail fast philosophy is not a plus if the company if you know, actually makes the mistake of producing something tangible?

    • Yes - fail often fail fast is great for a HTML editor. For actual mechanical devices that cost more than $10 - not so much.

      • For mechanical devices that go 80 miles an hour on the expressway and can kill Star Trek actors because of bad transmission UI design, it's awful.

        • For mechanical devices that go 80 miles an hour on the expressway and can kill Star Trek actors because of bad transmission UI design, it's awful.

          In some cases, it's criminal.

          (On the part of the engineer who signed off on followed plans, or the person who modified the plans).

  • As a principle? What about in practice? (Score:5, Insightful)

    by bobbied ( 2522392 ) on Wednesday June 29, 2016 @06:44PM (#52416843)

    So "As a principle, we are always willing to buy back a car...[when]... a customer isn't completely happy"

    So much for principle if in practice somebody had to sue you to make you do it..

  • How's that again? (Score:5, Funny)

    by 93 Escort Wagon ( 326346 ) on Wednesday June 29, 2016 @06:49PM (#52416853)

    ... doors opened and closed unpredictably, smashing into his wife and other cars ...

    The dude is married to a car?

    I've heard of My Mother the Car [wikipedia.org], but this is a first.

    • Re: (Score:3, Funny)

      by Anonymous Coward

      ... says the 93 Escort Wagon!

    • If a man without a woman is incomplete (as the Bible says), then I guess this guy decided to autocomplete.

  • Tesla (Score:1)

    by Anonymous Coward

    And I was just getting worried that it's been nearly a day before we went on and on about Tesla and His Holy Lordship Musk

  • Tesla is still an exotic car company. (Score:5, Interesting)

    by LWATCDR ( 28044 ) on Wednesday June 29, 2016 @07:03PM (#52416897) Homepage Journal

    Exotic cars are bought by enthusiasts and they forgive problems that your average Honda buyer will not. The Model X and 3 are now going into the hands of none enthusiasts and even Consumer Reports has taken away it's recommend from the Tesla.
    Surprise, making cars is hard.

    • Re: (Score:2, Interesting)

      by Anonymous Coward

      The Model X and 3 are now going into the hands of none enthusiasts

      The 3, sure (excepting the "now" part on that), but I'm not sure anyone who'll drop a hundred grand - on one of the first batch of the first SUV from a manufacturer on its second mass-produced car model ever, no less - counts as a non-enthusiast.

    • Re: Tesla is still an exotic car company. (Score:1)

      by Anonymous Coward

      The problem is that Tesla is pushing itself as a "luxury car" company (like Mercedes or Porsche) when in reality you're correct in that they're an "enthusiast car" company more like Caterham or those other British niche marketers.
      The disconnect between marketing and reality is the issue Tesla needs to fix.

      • Re: Tesla is still an exotic car company. (Score:1)

        by Anonymous Coward

        Thw disconnect is in the head of Musk and his fans: from tfs: "Indeed, there's no disputing the fact that ... the company has completely turned the auto industry on its head." Come on, that's not a fact, but a wild, groundless speculation.

        • You only need to see the stream of electric vehicle announcements other vehicle manufacturers have been making to realize that yes, Tesla has proven to the industry that there is a larger demand on electric vehicles than previously thought; that it is not merely a toy project, but a real threat going forward in coming decades. "Come on, that's not a fact, but a wild, groundless speculation." No, it's called reality my friend.
    • That your average Mercedes buyer will not forgive.

      Anyone who owns a Honda ex-eats to make sacrifices for a cheap car.

      Innovation does not excuse a crappy product. There is no way that a death trap seat is the result of innovation. It is the incompetence and arrogance of an inexperienced agent thinking they can make a car. Sort of like MS in security in the 1990's. Not being able to write software for doors in incompetence in embedded systems. Writing consumer embedded code is different from web server

      • Re: (Score:3)

        by LWATCDR ( 28044 )

        You may be surprised just how much less reliable a Mercedes S class or BMW 7 series is than you average Honda is.

        • No I wouldn't. I have had 2 Mercedes, one BMW, one Porsche, and 2 VWs. "Owner Financed Development" was something I learned about the hard way. The modern 7 series and their ilk are cars you NEVER NEVER EVER want to own out of warranty.

        • Re: (Score:2)

          by fermion ( 181285 )
          Mechanically, a Honda might be more reliable. On the other hand, early Hondas rusted thought and their door latches were fragile. Safety wise, like seats that move and doors that open randomly, Mercedes is likely a better choice.

    • Re: (Score:3)

      by hey! ( 33014 )

      Well, I thought the door thing was overkill; as an engineer it struck me as a "neat" demo feature but a real potential PITA, and it turns out I was right.

      • Just watched the demo. How did he manage to hit his "wife and other cars" with those doors is beyond me. It opens slowly and goes mostly up. Sounds like a bullshit case and a smear campaign.

        • Re:Tesla is still an exotic car company. (Score:4, Informative)

          by AmiMoJo ( 196126 ) on Thursday June 30, 2016 @03:37AM (#52418029) Homepage Journal

          The front driver's side door has an auto-open feature when you come near it holding the key. The rear doors can be opened remotely or via the console in the car. There are supposed to be sensors that stop them bumping into things, but a few people have said on the forums that they don't always work.

          It's the same with summon. There are sensors on the car, but there are also videos on YouTube of it running over stuffed animals standing in for children. Of course you are supposed to be paying attention yourself when using summon. The problem is that Tesla tends to hype features up and send them out as software updates, and then people use them without really reading TFM.

        • Re: (Score:2)

          by mccalli ( 323026 )
          Look how the demo is given next to another Model X. The Model X has a narrower top than the bottom, and it gives a fair amount of room at the top for this kind of things to happen - you can see the doors encroaching into the space above the widest point of the other car.

          Now imagine if that other car wasn't a Model X. Perhaps it's an SUV, or a van. No such extra space at the top, nothing for those does to use. Result? Bang.
          • I have never seen anyone park THAT close to other cars, if only to save the rear view mirrors. Then there is an issue of opening regular doors -- the driver does need to get out. I can only imagine this being an issue if it was done on purpose.

    • Tesla finding out that building a car from scratch isn't as easy as it sounds.

    • Re: (Score:2)

      by NetNed ( 955141 )
      Yeah, you don't see the problems like these with other exotic cars, probably because those companies have been making cars for a LONG time. The process gets perfected over time and quality tends to increase for the most part. The media wants to put Tesla on a pedestal all the time and claim he is revolutionizing how cars are built, which anyone that knows better knows this is utter bullshit. Tesla has used talent from Detroit and elsewhere to accomplish what they couldn't on their own, but if you believe th

  • Come on (Score:4, Funny)

    by Anonymous Coward on Wednesday June 29, 2016 @07:07PM (#52416911)

    He's totally gonna colonize Mars and stuff. Sure, airlocks will open, food won't dispense, but the species, this rock, exploration, etc etc etc

  • "there's no disputing"

    Since when does Slashdot allow logical fallacies in the summaries?

    • Now under their 3rd independent corporate ownership. I notice there are a lot bigger ads and a lot less trustworthy advertising partners too now.

  • The new way of doing business... screw people over and hide behind the promise of technological innovation. Are we that desperate for new technology that we are willing to allow companies to break long held assumptions about not taking a customer's money if they are not satisfied?
  • Think family truckster Clark!
  • Comment removed based on user account deletion

  • I think Telsa has learned some hard lessons from the Model X. They promised too many features without enough time and in the end resulted in an inferior product. They may be software bugs but when your software controls hardware, it has real consequences. I also hope they learned to not fight people trying to get a refund because there is no benefit in fighting it.

  • Or is it just Tesla that gets held to a standard no other car manufacturer is held to.

  • Watch the video linked in the summary and the moment before the car stops, a light comes on in the garage. This light probably messes with the cameras/sensors. Not making any excuses for Tesla, just making an observation.
  • Well, it does say in the article, "smashing into his wife and other cars", Maybe it also smashed into a certain Ford Model A made famous in the 1950's and 60's....Mother???
  • I always drive leased cars, using 3 or 4 years contracts. I now drive a Toyota, leased by Toyota Financial, I always check it for regular maintenance at the same dealership that leased it to me. If there's a problem with the car, it's Toyota's problem...

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