As I was looking through my new Automotive News online subscription, I ran across this intriguing story of buying a used Tesla. It described the buyers purchasing a Tesla Model S only to find out it had a salvage title. The problems mounted from there.
Imagine the used Tesla Model S you just purchased has no viable title. The repairs it needs, the dealer said, are still covered under warranty, and Tesla says it will not cover anything under warranty because it has a salvage title.
That's what John Porter and Isaiah Graham say happened to them as they explained it to their attorney. They have sued a Mercedes-Benz dealer in California and Tesla, alleging consumer law violations, fraud, and misrepresentation.
John says,
"We purchased a used Tesla Model S, and the dealer failed to disclose that it had been in a accident and now has a salvage title. The car is still under warranty, but, Tesla says they will not cover the warranty issues."
The report from Automotive News says, "John Porter and Isaiah Graham claim a California Mercedes-Benz dealer failed to disclose the car had been in an accident, "lied" about it not having a branded title, and misrepresented that the manufacturer's warranty was still in effect."
They Allege Tesla Also Lied About the Title's Status
AN says that the suit also contends Tesla "lied" about the vehicle's salvage status to withhold warranty repairs and accuses the company of having "a pattern and practice of deeming vehicles as 'salvage' when those vehicles do not meet the industry or statutory definition of 'salvage' so Tesla can unfairly deny warranty coverage.
Tesla denied the allegations in the answer it filed on January 13. Lawyers for Tesla and Mercedes-Benz declined to comment on the case.
According to the complaint, John Porter and Isaiah Graham bought the 2021 Tesla Model S in February 2024 for $76,196. When they later tried to use the manufacturer's warranty, they allege that Tesla responded that the warranty was void because the car was deemed to have a salvage title.
"Mercedes-Benz of Oxnard and/or Tesla each engaged in, and continues to engage in deceptive acts and/or practices," the suit alleges, "And the plaintiffs contend they wouldn't have bought the Model S if they'd known about its accident history or that its warranty was voided."
Carfax reports Damage to the Tesla Model S Before the Car Was Purchased
The plaintiff's lawyer, Michael Klitzke, said, "Carfax reported damage to the front of the vehicle before my clients' purchase. As far as anyone has found, no salvage title was ever issued for this vehicle, and the National Motor Vehicle Title Information System does not show that an insurance company deemed it a total loss/salvage. That would suggest Tesla's salvage claim and denial of warranty coverage was wrong."
In the Automotive News report, Klitzke, of Escondido, told them that he is unaware of any court decisions on the subject but "heard about Tesla treating structural damage (frame or unibody damage) as salvage in the past, which would not appropriate."
"Tesla may have been aware of the total loss through its own insurer but did not report it to parties "downstream," he said.
"It is also possible, and I think much more likely, that Tesla is aware of the damage event through Carfax, Tesla service center, or a Tesla-certified body shop and has decided to call it a salvage, which would void the warranty."
The plaintiffs are asking Mercedes-Benz of Oxnard to rescind the sale and for compensatory and punitive damages and attorney fees.
What Should Used Car Buyers Do To Ensure They Don't Buy a Car With a Salvage Title?
To avoid buying a car with a salvage title, you can:
Check the vehicle history:
Use a vehicle history report from a service like CarFax or AutoCheck to see if the car has a salvage title. You can also check the National Motor Vehicle Title Information System (NMVTIS).
Get an inspection:
Have a mechanic inspect the car for hidden damage or problems.
Ask for records:
Ask the seller for repair receipts and maintenance records.
Check for recalls:
Use a free tool from the National Highway Traffic Safety Administration (.gov) to check for safety issues and recalls.
Get insurance and financing quotes:
Get quotes from insurance providers and lenders to see if they will work with the car.
Be wary of fraud:
Sellers may downplay damages, so be skeptical and rely on your inspection and vehicle history reports.
Consider the car's condition:
A vehicle with a salvage title may have lingering issues, even after repairs. For example, some auto re-builders may not properly align the structure or install airbags.
Final Thoughts and Questions
When you purchase a used car from a private party, using a vehicle history report from a service like CarFax or AutoCheck is essential to see if the vehicle has a salvage title. If you purchase a car from a car dealer, also ask for a vehicle history report.
You should also check the title document for accuracy, verify the VIN matches the car, and, if unsure, consider getting a third-party title inspection through the National Motor Vehicle Title Information System (NMVTIS).
Have you ever purchased a used vehicle with a salvage title? Click the red Add New Comment link below and tell us about your experience.
Check out my Tesla Model X story titled; Tesla Model X Owner Says, People Say It Must Be Bad In the Snow, and Hard to Charge, I Laugh and Say I Don't Have to Go Out Of My Way to Pump Gas in Sub-Zero Temps
I am Denis Flierl, a Senior Torque News Reporter since 2012. My 30+ year tenure in the automotive industry, initially in a consulting role with every major car brand and later as a freelance journalist test-driving new vehicles, has equipped me with a wealth of knowledge. I specialize in reporting the latest automotive news and providing expert analysis on Subaru, which you'll find here, ensuring that you, as a reader, are always well-informed and up-to-date. Follow me on my X SubaruReport, All Subaru, WRXSTI, @DenisFlierl, Facebook, and Instagram.
Photo credit: Denis Flierl via Tesla dealer
Comments
CA State law: failure to…
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CA State law: failure to disclose the branded title was ILLEGAL on the part of the dealer. It's FRAUD, plain and simple. Time to contact an attorney, sue both Tesla and the MBZ dealership. Someone purposefully did not disclose the salvage title.
The dealer is only required…
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The dealer is only required to disclose if vehicle was in accident if it has a salvage title. Article says it doesn’t have salvage history. Sounds like Tesla is making excuses or Tesla insurance failed to report salvage damage themselves. Either way this isn't on the dealer and is on Tesla.