Guest Post: Tesla Performs Stealth Recall With Misleading Messages, Customer NDAs

Tyler Durden's picture

Authored by E.W. Niedermeyer via NewCartographer.com,

In early 2014, a Tesla Motors Model S that was part of the Edmunds.com test fleet suddenly lost power while merging onto a freeway. The car flashed several warning messages — "12V Battery Power Low - Car May Shut Down Unexpectedly" and "Car Needs Service - Car May Shut Down Unexpectedly" — before coming to a stop on the freeway onramp. Eventually a tow truck came to haul the stricken vehicle to a Tesla service shop, where the company replaced its drive unit for the third time.

This was a big deal. Not only is it embarrassing when a media outlet’s car breaks down in such a dramatic fashion, but any defect that causes a sudden loss of vehicle power is typically considered safety-related. There was also a grim point of comparison: the GM ignition switch scandal that was just starting to explode into the mainstream media had involved a defect that produced a similar sudden loss of vehicle power. Several months later, on Tesla’s second quarter earnings call, CEO Elon Musk addressed the incident by telling analysts:

“Well, there's definitely some genuine issues we have with the car, but they had one of our early production units, and in fact most of the problems that they have encountered there are not present in current cars. We also -- I think this may be ending up being counterproductive, but the service team was ultra proactive with the Edmunds car. So they would -- they were doing their best to make Edmunds happy, and I think unfortunately that resulted in them changing things up, just on the off-chance something might go wrong.

 

So that drive unit issue that I mentioned earlier were, the drive units [were] replaced even though it wasn't a drive unit problem, that happened with them twice. So, unfortunate sort of case, but I don't think it's broadly correct.”

Earlier in the call Musk had addressed the issue of Model S drive unit failures more broadly, explaining that the issues were often unrelated to the drive unit itself and that the necessary fixes --a $3 cable tie and a 50 cent shim for the differential-- were not expensive. With Musk’s assurance that these mysterious issues were not costing the company significant amounts of money, investors and the public eventually lost interest. NHTSA, which had its hands full with the GM scandal, never investigated. Though apparent drive unit failures continued to be reported, including several instances of cars suddenly losing power as the Edmunds car had, the whole issue steadily receded from public attention.

Then, in January of 2015, a Model S owned by a French taxi driver lost power while accelerating on a highway. The car threw the same error messages as the Edmunds car had before coming to a stop on the side of the road. The Model S taxi was also towed to a Tesla repair shop, but there its story diverges from the Edmunds story. Tesla didn’t replace the car’s drive unit, as it had with Edmunds, and its service invoice made no reference to the terrifying loss of power the driver had just experienced. In the field designated “Description du probleme: customer states,” Tesla wrote (in English):

“As part of providing peace of mind and a great ownership experience, Tesla vehicles are equipped with telematics systems to provide remote diagnostics support. We have been notified this vehicle has been remotely diagnosed that the Power Switch and Power Supply would benefit from the latest generation components.”

This use of what appeared to be boilerplate language surprised the taxi driver. Why didn’t Tesla simply describe what had happened to him in the space designated for just that? Why was a repair following a potentially dangerous incident being described as an “update” intended to “benefit” his car, and attributed to Tesla’s remote diagnostics? The taxi driver became suspicious.

It turned out that a number of Tesla owners had reported remarkably similar incidents in online forums, and that the failure of high voltage contactors was a fairly well-known issue. An owner who posts on the Tesla Motor Club forum under the username mknox describes an almost identical failure, complete with the loud bang and warning messages, and reported that Tesla service subsequently replaced his car’s high voltage contactors. Another owner, posting on the official Tesla.com forum under the name bobgriswold, reported the same malfunction while accelerating on a highway, which was also traced back to a faulty contactor. A TMC poster going by wk057 also lost power on the road, and after initially being told by Tesla engineering that the car’s firmware was to blame, the problem seemed to sort itself out. Then, about a month later he reported receiving an email from Tesla that was identical to the message that appeared on the French taxi driver’s invoice:

“As part of providing peace of mind and a great ownership experience, Tesla vehicles are equipped with telematics systems to provide remote diagnostics support. We have been notified this vehicle has been remotely diagnosed that the Power Switch and Power Supply would benefit from the latest generation components.”

Variations of this message have been reported by Tesla owners around the world. An owner in Washington State reports receiving the following email:

"Engineering has identified your car as potentially benefitting from a switch and power supply update. The technicians will evaluate your high-voltage system and determine whether it would benefit from having the latest generation power switches installed. If they determine that it would, we will perform the installation.

Over a dozen owners from around the world also report being contacted by Tesla and told that they would benefit from a contactor update. One owner recounts such a phone conversation:

“I got the call about a month ago, but they were not specific and required the car to be in the SC for two days, they did not provide details why needed to be changed, they keep insisting that nothing is wrong and is a ‘proactive’ fix.”

Tesla’s emphasis on the proactive nature of this campaign and the “non-safety related” nature of the issue was critical. If Tesla ever admitted, in any form of customer communication, that a contactor failure could result in danger to the driver or other motorists it would be required by law to issue a recall on the part. The TREAD Act of 2000, passed in the wake of the Ford/Firestone recall scandal, requires automakers to report any defect to NHTSA within five days of determining that it affects safety, after which it must order a recall. The same law also requires automakers to report to NHTSA

“Notices, bulletins, customer satisfaction campaigns, consumer advisories, and other communications sent to more than one owner regarding any defect in its motor vehicle equipment, including any failure or malfunction beyond normal deterioration in use, or any failure of performance, or any flaw or unintended deviation from design specifications, regardless of whether or not such defect is safety related.”

Rather than report and recall the contactors as a safety-related defect, Tesla issued a technical service bulletin (TSB). It is unclear when exactly the original TSB was issued, but the first revision was issued in May of 2013 and a second revision was issued in June of 2014. TSBs are only an accepted alternative to a recall by NHTSA if the defect it repairs is not safety related, and Tesla was careful to avoid giving the safety regulator any hint of a risk to drivers. For starters, Tesla called SB-13-44-003 a “HVIL [High Voltage Interlock Loop] Connector Upgrade,” implying that it was intended to improve performance rather than fix a defect. There wasn’t a hint in the bulletin that faulty contactors could cause sudden power loss, just the possibility the defect might make a car fail to start.

By calling the bulletin an “upgrade” and by suggesting that the worst case scenario was an inability to start the car, just four months after the Edmunds car had lost power on a highway onramp, Tesla buried the problem. It was a tactic that had worked before: according to a 2015 report by the Department of Transportation’s Inspector General [ PDF ], NHTSA investigators missed an opportunity to catch the GM ignition switch defect because GM filed a TSB that conspicuously failed to mention the possibility of a vehicle stalling.

Concealing the potential for a defect to cause a vehicle stall is well outside the norms of US auto safety reporting. NHTSA has considered such a fundamental loss of performance to have intrinsic safety implications since the 1970s and between 2004 and 2013, some 91 recalls were carried out to address defects that caused stalling. One of these was even for an electric vehicle: in November of 2013, Ford recalled its Focus Electric car for a problem involving a sudden loss of power that was eerily similar to Tesla’s contactor issue.

Even closer to home, both of Tesla’s (now-former) automaker partners, Mercedes and Toyota, have recently recalled their Tesla-powered vehicles for sudden losses of drive power. Mercedes recalled its electric B Class in 2015 for a problem involving an incorrect signal regarding the status of the high voltage contactor in its Tesla-sourced drivetrain, which could cause the vehicle to lose power. The problem was solved with a firmware update, but Mercedes still went through the recall process that Tesla has strenuously avoided. In 2015 Toyota recalled its own Tesla-powered electric vehicle, the RAV-4 EV, for a software issue that caused the vehicle to unexpectedly shift into neutral.

Why would Tesla not recall vehicles for sudden power loss, when there was no shortage of owner reports of the phenomenon and when both of the automakers who used its drivetrains did? Perhaps because they could. These decisions were made before NHTSA knew that Tesla made owners sign a non-disclosure agreement before performing “goodwill repairs” on defective vehicles or buying them back. The French taxi driver eventually signed an NDA as part of a buyback deal, and at least one online report of lost vehicle power appears to have concluded with an NDA. If owners weren’t independently reporting defects, NHTSA’s only other source of data about defects in Teslas was Tesla itself.

Had Tesla owners been more diligent in reporting sudden power loss to safety regulators, or if NHTSA safety investigators regularly read the online forums where Tesla fans do report defects, this might have been caught years ago. Because so many Tesla owners are also investors, forums often discourage defect reporting for fear that it might lead to bad publicity. So even though Tesla owners were able to connect reports of sudden power loss to the contactor flaw, their knowledge never made it to the safety regulators.

While there are no reported cases of injury or death as a result of this vehicle failure, Tesla repeatedly avoided the regulatory framework created by NHTSA to protect drivers. As the GM ignition switch case and many others have shown, the temporary embarrassment of a recall is far better than burying a defect with potentially serious safety implications. Tesla’s apparent attempts to avoid standard safety regulatory procedures are troubling.

At the time of publication, Tesla had not responded on the record to requests for comment.

Neither NHTSA nor the Department of Transportation responded to requests for comment.

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SloMoe's picture

Just need a longer extension cord...

Arnold's picture

Shovel in a little more coal.

nuubee's picture

Musk Tax Stream Inc...
1) Electric cars (subsidized through tax rebates)
2) Electric home battery systems. (subsidized through tax rebates)
3) Goal of putting people on "Mars" (subsidized by suing the U.S. Military for a chance at launch contracts)

He's a robber-baron setting himself as the new Steve Jobs to excuse his blatant sucking the government's teat.

Jeffersonian Liberal's picture

This "error message" is like MS replacing the old Blue Screen of Death with a message that states:

Your MS operating system is equipped with a diagnostic feature that indicates that your PC may benefit from being shut down and restarted.

 

DetectiveStern's picture

Sounds like Windows ME. That would shut down and restart whithout even bothering to tell you.

Last of the Middle Class's picture

Fucking windows ME!! I haven't thought about that shit in years. Windows (M)ight (E)xplode any second. I never saw a computer that could run that shit without barfing up a BSOD.

Rockatanski's picture

totally agree. his cars would not be on the road AT ALL if it wasnt for uncle sugar tit. and if they were, they'd cost 4 times as much.

musk is a dickhead.

jcaz's picture

Gonna be interesting to see how long Ford and GM put up with Uncle Sugar Tit, seeing how Tesla is now valued higher than either;

I can see their CFOs now- "WTF???"

At what point does Tesla cut the cord, so to speak?  

Easy to build an electric car when you don't have to worry about making a profit.....

Hell, why not just give them away?  What's the diff at this point?

kochevnik's picture

Anyone driving a Tesla is driving betaware.  How bad were cars when Henry Ford built the Model T?  I an happy that Musk decided to make something useful of his talent instead of selling drugs to children or bombing brown people abroad

If Americans would fill their lives instead of living in quiet, stupid desperation, they would stop feeling the warmonger bloodlust.  Read a fucking book or go out in the sun

And yes I know Russian cars are bad. but they are adapted to our roads which are no worse then USA roads now!

2_legs_bahhhhhd's picture

Paging Mr Musk to the courtesy phone

You have a margin call from the American taxpayer

SloMoe's picture

Translated from google, but as they say, a picture's worth a thousand words.

"Tesla driver: car crashed completely autonomous"

https://translate.google.com/translate?hl=en&sl=nl&u=http://www.autoblog...

http://www.autoblog.nl/nieuws/tesla-model-s-botst-op-vrachtwagen-97589

Games Without Frontiers's picture

I'm sure the recall would be government subsidized as well.

SILVERGEDDON's picture

How the fuck is Elon gonna go to Mars if he is fixing his broken fucked up poorly engineered shit box cars ?

Fucking insensitive article.  

SILVERGEDDON's picture

The Muskie one is a fucking genius liar / thief / tax payer robber baron - nothing more, nothing less. 

peippe's picture

he's selling the concept of Mars, not trips. 

he sells the concept of an electric vehicle, 

they just happen to have improper differential pre-load, 

it takes a mechanic three hours or more to re-set preload, 

even if the shim is 50 cents.

  This guy Elon puffs up his own shit & concepts while degrading anything but his own lame-ass executed ideas.

One day his BS will kill enough people spectacularly enough that the backers of his insanity will walk away. 

IF they aren't standing too close to his latest 'breakthrough' when it goes off.

I am Jobe's picture

Didn't Piper Jaffrey upgrade Tesla?

I am Jobe's picture

TESLA sucking on GOVT TITS for WELFARE. State of Nevada is going to regret the tax breaks

Stan Smith's picture

   Weather or not many Tesla owners are investors as well would lead me to the next question... couldnt these same people be implicated as suppressing information to the public in regards to the safety of the vehicles?    Couldnt that come back to bite them, not just Tesla?

GETrDun's picture

Easily repaired with duct tape.

BULLISH.

venturen's picture

NDA recalls should be ILLEGAL!

booboo's picture

Reminds me of the time the wife took an Accord in to the dealer, they changed the oil and other service work but then called and said we needed to return the car because the mechanic used crankcase cleaner instead of oil. Yea, I told them to come tow the car, the rep said it won't hurt the vehicle to drive it, just drive it straight back. I said fine, then we can leave it in there then and change it in 5000 miles and hung up, he called back to say he was sending a tow truck.

2_legs_bahhhhhd's picture

Haha, we once had a Nissan Maxima in for a 4000$ "goodwill" repair on a misdiagnosed valve sensor issue. A few days later I discover that they forgot to put in the four bolts connecting the steering column....ooops

TwelveOhOne's picture

My mom had one of her cars serviced, and they put the radiator fan in backwards.  Doh!

More recently I had a car serviced and their stupid sales department kept texting me in the early AM hours, and I kept telling them to stop.  Got a $600 repair for free, which means, they knew I had a case, and probably could have gotten more had I pursued it.  I'm happy with the free repair though, and no additional headaches.

Consuelo's picture

 

 

 The 'fad' of Tesla is almost exclusive to the $ad-revenue (FANG) economy of the Bay Area.   When (not if) the fad of showing off what you had for dinner and how it came out the other end takes a powder, the 'bad day for shorts' is going to prove a very $$$good day indeed.

Winston Churchill's picture

Makes you wonder what other porkies Elon is telling us

Pork pies= lies, in Cockney.

True Blue's picture

Don't be a garden fence. Even someone without watch and chain knows that with the gov't as your briney marlin, you don't need to worry about bottles and stoppers hauling you before the bubble and squeak before stripping you to your thick and thin when the whole thing goes pie and mash. Musk can't take the long Bo-Peep soon enough.   

Dealyer Turdin's picture

What!!!! Awesome, hats off to the inventor of teh English Corkscrew!

ThanksIwillHaveAnother's picture

If Tesla did a recall, how would they handle the repair volume?  Fake car company.

Magooo's picture

Consumer Reports ranks Tesla near bottom for reliability

http://www.cnbc.com/2016/10/24/consumer-reports-ranks-tesla-near-bottom-for-reliability.html

 

Who buys these pieces of shit?

 

Oh right - almost nobody.

 

Tesla sold only sold 4,050 new vehicles in the US in March, according to Autodata
http://wolfstreet.com/2017/04/04/carmaggedon-not-yet-declining-auto-sales-record-incentives/

adr's picture

TESLA SAYS THEY SOLD OVER 25,000 CARS IN THE FIRST QUARTER!!!!!!!

MUSK WOULDN'T LIE

Oh wait, he's hebrewish.

moorewasthebestbond's picture

Telsa = Literally a flaming POS!

TheRideNeverEnds's picture

No no no, you've got it all wrong.

Its just a simple case of un-commanded rapid oxidation whereby O2 is converted into CO with a few by products. Nothing too serious, no need to panic. Just sign this NDA and we will come pick it up with a flatbed at 3am.

VWAndy's picture

 If there are electrons involved it will be screwing up.

  NDA ? WTF? I was under the impression its called a non disclosure agreement. This sounds more like a you better keep your mouth shut order.

Bernie Madolf's picture

berry vullish

If only they lost more per car this thing will really run

NAVIGATOR0832's picture

Indeed  Nicoli Tesla's bankrupting dream was wireless electrical transmission.

Cruel Joke's picture

Burning is just one of the features of Turdsla. Ball joints in the front suspension breaking - making one front wheel swing 120 degrees out is another. Makes for an interesting ride! And watch out for cracks in the A-pillar, and never ever use the auto-pilot self-driving-thingy.

aloha_snakbar's picture

Ewok Mush should be drawn and quartered for daring to use the name of an actual, real visionary, Nikola Tesla...fucking pussy accidental billionaire...

1.21 jigawatts's picture

2018 drivetrain updates include

"Ludicrous" mode and "Boat Anchor" mode.

adr's picture

Because a recall of Musk's only car would cause billions in stock market fantasy wealth to evaporate instantaneously. Always the great scam artist, Musk papered over the problem and Teslasuckers bought it.

aldol11's picture

comments are hilarious , i think i upvoted every single one before getting fed up.

my only commnet is obvious to all of you:

musk is a fraud

tesla is the new enron  

Truly Inspiration's picture

US engineering needs a lot of crash dummies as it is mostly based on trial and error. Just look at aerospace history or Microsoft.

Pulp Culture's picture

contactors. tesla can't master the low tech stuff. trust their autopilot? 

Kefeer's picture

The more of these defects the better chance we won't be forced to drive their evil crap!

 

I love the phrase "proactive fix"; people really invent new ways to lie.  Musk is a liar and his company is a fraud that continues because of taxpayer funding.

Last of the Middle Class's picture

Passed a couple of thos POS on the interstate in downtown Houston a few weeks back. Basically looked like they were tying up traffic, you have to go into another lane and fricking go around them to get by. I just don't see those things as ready for prime time any time soon. Big loss per vehicle just to get them off the fricking lot and absolutely no accounting for the $$$ needed for maintenance and battery upgrade, not to mention recycling the rare earth elements in the battery pack or the massive open pit mining needed to get the rare earth metals in the first place. Not good, A con is a con is a con. Elon will be juggling his bullshit eco greenie save the earth piece of shit companies all the way to Mars.

Smerf's picture

Tesla is a technology company, not a car company, therefore they don't do recalls, they're updates.

Westcoastliberal's picture

Just forget it and buy a Prius.

Let it Go's picture

Tesla is crusing for a fall. Elon Musk is one of those iconic figures the world occasionally conjures up to wow and entertain the masses. With his youthful looks and forward thinking the media latched on to Musk and propelled him into being viewed as a visionary and wonder-boy that turns everything he touches to gold.

As to the source of his success, it seems Tesla Motors Inc., SolarCity Corp. and Space Exploration Technologies Corp., known as SpaceX, together have benefited from an estimated $4.9 billion in government support and subsidies. The article below delves into both Tesla and Musk and whether they will go down in flames.

 http://brucewilds.blogspot.com/2017/02/elon-musk-and-tesla-motors-overview.html

J2nh's picture

Tesla is a government owned and financed vehicle company with all the efficiency and dependability that comes with that moniker.