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Tesla repair costs are causing insurance providers to write off low-mileage EVs: report
While Elon Musk noted during the Q4 and FY 2022 earnings call that data from Tesla Insurance is helping the company minimize vehicle repair costs, the story seems different for Teslas that are covered by other insurance providers. As per a recent report, even low-mileage Teslas are already being written off by insurance companies.
Elon Musk described Tesla’s efforts to lower its vehicles’ cost of repair in the recent earnings call. “We’ve actually adjusted the design of the car and made changes in the software of the car to minimize the cost of repair… So it’s giving us this really good feedback before, again, reducing cost,” Musk said.
Outside Tesla Insurance’s coverage, the situation is different, at least according to a Reuters analysis. Data from Copart and IAA, which are among the largest salvage auction houses in the US, indicated that many “totaled” Model Y units listed for auction in December and January had fewer than 10,000 miles on their odometers. Considering that these vehicles were bought prior to Tesla’s price cuts earlier this month, the retail prices of the cars were about $60,000 to over $80,000.
Insurance companies usually consider a vehicle a total loss when the cost of repairing it is deemed too high. Interestingly enough, out of the 15 Giga Texas-made Model Y Long Range vehicles that were part of the publication’s analysis and declared as total losses from June to November, 14 had fewer than 10,000 miles on their odometers.
These include a Giga Texas-made 2022 Model Y Long Range, which was listed by IAA with front collision damage in early January. The vehicle had a retail price of $61,388 and an estimated repair cost of $50,388. Another Model Y, which was listed with side collision damage, had a retail price of $72,667 and an estimated repair cost of $43,814.
As per Reuters’ analysis, several prominent insurance companies such as State Farm, Geico, Progressive, and Farmers, are among the providers that have considered low-mileage damaged Teslas too expensive to repair.
Considering the estimates for the repair of damaged Teslas, it is no surprise that some insurance companies are opting to write off the damaged vehicles as total losses. It’s difficult to argue, however, that such a strategy is wasteful. At this point, it seems like the best-case scenario for Tesla is to ramp up the expansion of its insurance service. This way, its owners are not burdened by insurance providers that do not seem to fully understand their vehicles.
Elon Musk said as much during the fourth quarter and full-year 2022 earnings call last week, when he explained how Tesla Insurance is giving the company a good feedback loop on how to optimize the costs of its vehicles’ repair.
“It is also giving us a good feedback loop into minimizing the cost of repair of Teslas — for all Teslas worldwide — because we obviously want to minimize the cost of repairing a Tesla if it’s in a collision… And previously, we didn’t actually have good insight into that because the other insurance companies would cover the cost. And actually, the cost in some cases were unreasonably high,” Musk said.
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News
Tesla gathers Cybercab fleet in Gigafactory Texas
Images and video of the Cybercab fleet were shared by longtime Giga Texas observer Joe Tegtmeyer in posts on social media platform X.
Tesla appears to be assembling a growing number of Cybercabs at Gigafactory Texas as preparations continue for the vehicle’s mass production. Recent footage shared online has shown over 30 Cybercabs being transported by trucks or staged near testing areas at the facility.
The images and video were shared by longtime Giga Texas observer and drone operator Joe Tegtmeyer in posts on social media platform X.
Interestingly enough, Tegtmeyer noted that many of the Cybercabs being loaded onto transport trucks were still equipped with steering wheels. This suggests that the vehicles are likely testing units rather than the final driverless configuration expected for the company’s Robotaxi service.
The vehicles could potentially be headed to testing sites across the United States as Tesla prepares to expand its Robotaxi fleet.
Additional footage captured at Gigafactory Texas also showed the Cybercab’s side and rear camera washer system operating as vehicles were being loaded onto transport trucks.
The growing number of Cybercabs at Giga Texas comes amidst the company’s announcement that the first production Cybercab has been produced at the facility. Full Cybercab production is expected to begin in April.
The vehicle is expected to play a central role in Tesla’s Robotaxi ambitions as the company looks to expand autonomous ride-hailing operations beyond its early deployments using Model Y vehicles.
Tesla has also linked Cybercab production to its proposed Unboxed manufacturing process, which assembles large vehicle modules separately before integrating them. The approach is intended to reduce production costs and accelerate output.
Musk has also noted that the Cybercab’s ramp will likely begin slowly due to the number of new components and manufacturing steps involved. However, he stated that once the process matures, Cybercab production could scale quickly.
Elon Musk
Elon Musk’s xAI, creator of Grok and Grokipedia, celebrates its third birthday
xAI Memphis highlighted several of its milestones over the years in its celebratory post.
Elon Musk’s artificial intelligence startup xAI has marked its third anniversary. The update was shared in a post from the xAI Memphis account on social media platform X.
xAI Memphis highlighted several of its milestones over the years in its celebratory post.
As per xAI, it has built three massive data centers in the city, launched a coherent cluster of 330,000 GBs, created over 3,000 jobs, and paid over $30 million in taxes to local communities.
xAI’s Memphis operation has become a key part of the company’s infrastructure as the company works to train and deploy its Grok artificial intelligence models. Elon Musk has been quite optimistic about Grok’s potential, noting in the past that the large language model might have a shot at achieving artificial general intelligence (AGI).
xAI’s Memphis’ crown jewel is its Colossus supercomputer cluster. The project was announced in 2024 and has since become the home of one of the world’s largest AI compute facilities. The first phase of Colossus reached its initial 100,000 GPU operational milestone in just 122 days, or just about four months.
Industry figures such as Nvidia CEO Jensen Huang have praised the facility, noting that projects of similar scale typically take two to four years to complete.
xAI has cited Memphis’ central location, skilled workforce, and industrial infrastructure as key reasons for selecting the city as the home of its AI training operations. The company has also emphasized plans to expand the site further as it scales compute capacity for Grok and future AI models.
News
Tesla Sweden’s Megapack Supercharger near Arlanda continues to aggravate IF Metall union
The charging site, located in Arlandastad outside Stockholm, appears to be operating despite ongoing union blockade measures tied to Tesla’s labor dispute in the country.
Tesla Sweden’s Megapack-powered Supercharger station near Arlanda Airport has continued to aggravate Swedish labor union IF Metall. The charging site, located in Arlandastad outside Stockholm, appears to be operating despite ongoing union blockade measures tied to Tesla’s labor dispute in the country.
Comments about the site were shared by IF Metall representatives in remarks to Swedish publication CarUp.
The Arlandastad location includes eight Tesla Superchargers powered by a Megapack battery system. Unlike traditional charging stations that rely on direct grid connections, the site uses a large battery installation to store electricity and power the chargers.
According to the Swedish publication, the setup allowed the station to come online despite sympathy measures from Sweden’s electricians’ union, which has attempted to prevent companies from cooperating with Tesla as part of the broader labor conflict.
IF Metall press manager Jesper Pettersson indicated that the union was not aware that the Superchargers had already been connected and activated.
“We do not know the details around this. But it is further proof of how Tesla systematically finds loopholes to circumvent the sympathy measures through active strikebreaking. Every time this happens it gives us reason to sharpen our conflict measures,” Pettersson said.
Union representatives also noted that the Megapack appears to be charged using electrical cables routed through nearby terrain, though the exact power source remains under review.
The Megapack-powered site has then prompted questions from Swedish labor unions about how electricity is being supplied to the system.
IF Metall has submitted a report to Sweden’s Energy Market Inspectorate asking the regulator to review whether the electricity supply arrangement complies with national regulations. The Megapack is reportedly charged using electricity from a local company, though the provider has not been publicly identified.
Peter Lydell, an ombudsman at IF Metall, previously stated that Swedish law limits electricity trading to companies with proper authorization.
“The legislation states that only companies that engage in electricity trading may supply electricity to other parties. You may not supply electricity without a permit, then you are engaging in illegal electricity trading. That is why we have reported this…
“This is about a company that helps Tesla circumvent the conflict measures that exist. It is clear that it is troublesome and it can also have consequences,” Lydell said.
IF Metall and Tesla Sweden’s conflict has been going on for over two years now.
Tesla gathers Cybercab fleet in Gigafactory Texas
Elon Musk’s xAI, creator of Grok and Grokipedia, celebrates its third birthday
