Elon Musk faces more embarrassment as lawsuit accuses Tesla of over-inflating odometers
Plaintiff, Nyree Hinton, alleges that Tesla odometer readings reflect energy consumption, driver behaviour and "predictive algorithms" rather than actual mileage driven
Elon Musk's Tesla faces fresh legal trouble as a proposed class action lawsuit accuses the electric carmaker of manipulating odometer readings to prematurely void warranties.
Such a move could save the company millions in repair costs. The plaintiff, Nyree Hinton, alleged that Tesla odometer readings reflect energy consumption, driver behaviour and "predictive algorithms" rather than actual mileage driven. Based on his other vehicles and driving history, he said the odometer on the 2020 Model Y he bought in December 2022 with 36,772 miles on the clock ran at least 15 per cent fast. For a while, he said the car recorded 72 miles a day when he drove at most 20. Hinton, a Los Angeles resident, said this caused his 50,000-mile basic warranty to expire well ahead of schedule, leaving him with a $10,000 suspension repair bill that he thought Tesla should cover.
According to Hinton's lawsuit, he claims: "Rather than relying on mechanical or electronic systems to measure distance, plaintiff alleges on information and belief that Tesla Inc. employs an odometer system that utilises predictive algorithms, energy consumption metrics, and driver behaviour multipliers that manipulate and misrepresent the actual mileage travelled by Tesla Vehicles.
"In so doing, Defendants can, and do, accelerate the rate of depreciation of the value of Tesla Vehicles and also the expiration of Tesla Vehicle warranties to reduce or avoid responsibility for contractually required repairs as well as increase the purchase of its extended warranty policy."
He goes on: "These systemic inaccuracies and fraudulent business practices undermine the value of Tesla Vehicles and their warranties, erode consumer trust, and suggest intentional practices designed to financially benefit Tesla Inc. at the expense of its customers.
"By tying warranty limits and lease mileage caps to inflated 'odometer' readings, Tesla increases repair revenue, reduces warranty obligations, and compels consumers to purchase extended warranties prematurely."
Tesla can remotely monitor their cars in various ways, including through GPS, cameras, and other sensors. They can track the car's location, monitor driver behaviour, and remotely access features.
However, Tesla also claims to protect driver privacy and that some data is not transmitted to them. The complaint comes as Musk, the world's richest man, has seen his fortune tank by billions as Tesla grapples with a deepening crisis. The electric carmaker's first-quarter profit dropped 71 per cent, sparking investor panic and slashing the company's market value.
Amid growing concerns about Musk's role in Donald Trump's administration, Tesla vehicles have also become targets of vandalism in several cities, reflecting mounting public frustration.
Once the undisputed leader in EV innovation, Tesla now faces fierce competition and sliding consumer trust.
Tesla has delivered more than 250,000 vehicles in the UK.
The EV maker and its lawyer did not immediately respond to requests for comment but have denied all material allegations in the lawsuit.
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