By on March 18, 2020

Last month we covered an alarming trend where Tesla appeared to be intentionally removing features from vehicles as they entered the secondhand market. Used automobiles are typically sold with their original equipment intact. The previous owner may have wanted to yank out the tape deck or remove the fuzzy steering wheel cover before handing it over, but these are things you probably negotiated before any money changed hands. Unfortunately, things have only grown more complicated in the (post)modern era.

Reports have rolled in of Tesla stripping cars of thousands of dollars worth of features (mainly Autopilot and Ludicrous Mode) simply because they’re in line for a new owner. This sets an ugly precedent for the industry and undermines the time-honored tradition of the private sale. However, there seems to be some amount of confusion surrounding the company’s official policy and its behavior. 

Jalopnik, which first reported on the issue, has spent the last month trying to get answers from Tesla — with mixed results. While the company did restore the erroneously named “Full-Self Driving” suite to one de-featured Model S, citing it as a miscommunication, other secondhand shoppers weren’t so fortunate.

From Jalopnik:

One Tesla owner who reached out, Brett, bought a 2018 Tesla Model X P100D from a Tesla dealership in March 2019. Because the car was a showroom vehicle and the previous year’s model, he got it at a bit of a discount, and the car was equipped with Ludicrous Mode (he confirms it was available as an option in the menu), which was further evidenced by the badging on the car, which featured an underlined P100D badge, which is normally used to indicate a car equipped with Ludicrous Mode from the factory.

Brett added FSD to the car for $5,000 extra, though there were issues with Tesla’s systems knowing he had paid for that option. In the process of confirming he had indeed paid for FSD, Tesla decided he didn’t really pay for Ludicrous Mode (which was originally a $20,000 option) and removed Ludicrous Mode from his car.

This echoes other claims floating around various Tesla forums. Customers or independent retailers purchase a used vehicle, take it in for servicing, are subjected to a surprise “audit” and find themselves suddenly on the hook for a pricy feature the vehicle had just days earlier. In the case of Brett, upon further inquiry Tesla basically said he wasn’t entitled to the go-fast software.

“We have reviewed your situation extensively and while we understand that this misconfiguration may have caused confusion, it would not be fair to those who have paid for Ludicrous Mode to make an exception,” a Tesla employee responded. “We are happy to help you purchase the upgrade, or you’re welcome to use your vehicle with Insane Mode.”

The manufacturer has yet to issue an official response as to why this practice exists, though the brand’s customer support hotline told both us and Jalopnik that any features purchased when the car was new (that weren’t subscription based) would carry over to all subsequent owners. This would be a huge relief if we didn’t already know Tesla was acting contrary to the claim. Instead, it feels as though the automaker is testing the waters to see what it can get away with.

Considering used vehicle prices typically account for options, Tesla needs to make abundantly clear what its official policy actually is. While few wish to see Ludicrous Mode, Autopilot, and FSD embrace the subscription model, it would at least provide some clarity for secondhand shoppers. Alternatively, Tesla could stop being so greedy and simply leave the content in its cars alone. Sneakily removing content after someone purchases a vehicle is a bridge too far — tantamount to theft.

For now, the issue doesn’t appear too widespread and primarily impacts units with the most bells and whistles. There’s even a chance that these are isolated incidents (though the window for that being a viable reality is quickly closing). Tesla has had over a month to respond to this. The few answers given, however, have not been heartening.

[Image: JL IMAGES/Shutterstock]

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50 Comments on “Tesla Clearly Confused About Secondhand Vehicle Sales...”


  • avatar
    SCE to AUX

    “Sneakily removing content after someone purchases a vehicle is a bridge too far — tantamount to theft.”

    More like bait and switch.

    Another problem is the middlemen (used car dealers) who are in the dark on this. They will be providing too-high trade-in values to the original buyer, only to find their inventory has been devalued overnight – not cool.

    These features (even the FSD vaporware) should be frozen to the VIN, not the original buyer – period.

  • avatar
    R Henry

    This scenario seems pretty consistent with the history of this particular manufacturer.

  • avatar
    DC Bruce

    Some wise guy lawyer at Tesla is probably saying that, because these features are implemented in software, the license to use them is not automatically transferred to the new owner of the car. Just as if you sell your computer to someone, some of the application software on it may not be licensed to the new owner of the computer. This was especially true when software was distributed to physical media, rather than downloads.

    Expect some pretty heavy-handed regulation if this practice continues . . . and rightly so.

    • 0 avatar
      mcs

      “because these features are implemented in software,”

      Not exactly. For the sake of accuracy, FSD is hardware with software that makes it function.

    • 0 avatar
      JimZ

      “Just as if you sell your computer to someone, some of the application software on it may not be licensed to the new owner of the computer. This was especially true when software was distributed to physical media, rather than downloads.”

      in general it still keeps working, though. Exception would be “subscription” based software like Office 365 or Adobe CC. But those are clearly subscriptions with a regular recurring fee. Tesla does not advertise these features as “Subscription” so they have no reasonable expectation of being entitled to charge second owners of a vehicle for a feature it was shipped with.

      • 0 avatar
        Art Vandelay

        But with those Office 365 subscriptions I get to use them on my new Computer. If one trades in a Tesla and these features are removed, do they get them for free on their new Tesla? The current situation would be akin to me selling my Computer and Microsoft not letting the new user use it (It’s a subscription, why would they), but also blocking my login on my new Computer.

        • 0 avatar
          mcs

          @Art: do they get them for free on their new Tesla

          If you buy CPO direct from Tesla and it’s on the invoice as having been purchased, you get it.

          In the case in question, Tesla removed it even though it was on the invoice. The guy it happened to would have won in court.

          If it ever happens to me in that situation, I’ll report it as theft by hacking and let them deal with law enforcement – after warning their legal department directly.

          For used cars not sold by Tesla, it’s a matter of reading the license agreements. If it says the software goes with the vehicle and they take it away, take them to court. If it doesn’t, then don’t pay for the feature.

    • 0 avatar
      cprescott

      DC is wrong – this is all TESLA software – just like if you installed something specific to DELL, it goes with the computer. We aren’t talking about software that is sold by a second party on behalf of Tesla; this is automobile specific software even if Tesla tries to make it OWNER specific. This is one huge class action case that Tesla will end up paying through the nose. And should Tesla win, this will kill the resale value of the luxury golf carts they are selling.

  • avatar

    Tesla are playing with fire. If the practice takes hold (i.e. Tesla think they can get away with it) then before too long the resale value of Tesla’s will take a huge hit. This will be almost impossible to reverse once it happens.

    • 0 avatar
      R Henry

      @JPWhite

      “resale value of Tesla’s will take a huge hit”

      Resale value is a reflection of consumer interest and confidence in a car brand. From what I can surmise, TESLA remains a very hot brand, which gives it tremendous room to control their transactions to their own benefit.

      Could Nissan or GM pull this off? To ask the question is to know the answer.

      • 0 avatar
        SCE to AUX

        “which gives it tremendous room to control their transactions to their own benefit.”

        But the problem is Tesla’s meddling with used car transactions. They should have no control of that by decontenting vehicles.

        They’ll be forced to play fair.

  • avatar
    DenverMike

    It’s racketeering. Tesla creates “a problem” then can provide “the fix” if you want it. And it ain’t Free.

    Mobsters will break out the windows to your store then can provide “24 Hour security” if you want.

  • avatar
    JimZ

    First sale doctrine should apply here. once the original purchaser has paid for the car, the manufacturer should not have the ability to disable or remove features. No obligation to let them double dip.

  • avatar

    Again, ridiculous practice. They’ll be sued via class action eventually, and rightly so.

    • 0 avatar
      mcs

      Except, they did restore the removed features:

      https://www.theverge.com/2020/2/13/21136699/tesla-autopilot-used-model-s-owner-restored-assistance-features

      If they tried that with me, I wouldn’t bother with waiting for a class action and start legal action on my own. Sometimes a simple letter of demand works wonders.

      • 0 avatar
        JimZ

        after being essentially forced to.

        • 0 avatar
          mcs

          @jimz: “after being essentially forced to.”

          Unfortunately, that’s true for far too many companies. They know you’re right, but try to bluff their way through it. Then, when you file, they say it’s a mistake and settle. I’m running into it with non-automotive companies.

  • avatar
    slavuta

    I love it. What goes around, comes around. When 1st owners will find it difficult to sell their Teslas, and second owners will not run for them because of these practices; eventually, there will be less willing 1st owners who wants to get hit with depreciation.

  • avatar
    redgolf

    That’s Ludicrous!

  • avatar
    DenverMike

    Tesla deletes the “equipment” during updates. I hate updates, nothing good ever happens of them. I’ve had computers fail shortly after an update, so I won’t do them.

    If it works fine, I leave it alone. Except I understand a Tesla owner that had Autopilot removed was forced an update when replacing the computer (MCU) that runs the main screen.

    The Tesla MCU is a basically meant to fail, or is a “maintenance item” similar to spark plugs on an ICE engine.

    The replacement MCU is the same exact part that will also fail.

    • 0 avatar
      Lie2me

      I know I’m going to get in trouble for this, but I haven’t done a single update on my Windows 7 desktop since Microsoft tried to ram Windows 10 on me. I’ve never had such a problem free computer since and we’re talking years now

    • 0 avatar
      mcs

      @denvermke: “The Tesla MCU is a basically meant to fail, or is a “maintenance item” similar to spark plugs on an ICE engine. The replacement MCU is the same exact part that will also fail.”

      The MCUv1 was highly prone to the failure, the MCUv2 is improved, but at some point will fail. Not sure if any MCUv2s have actually failed yet though.

      There is a good aftermarket solution. For $1800, an aftermarket company will put in increased logging memory (16gb)_and root the car.

      It’s a stupid issue and occurs due to excessive logging.

  • avatar
    DenverMike

    Tesla deletes the “equipment” during updates. I hate updates, nothing good ever happens of them. I’ve had computers fail shortly after an update, so I won’t do them.

    If it works fine, I leave it alone. Except I understand a Tesla owner that had Autopilot removed was forced an update when replacing the computer (MCU) that runs the main screen.

    The Tesla MCU is a basically meant to fail, or is a “maintenance item” similar to spark plugs on an ICE engine.

    The replacement MCU is the same exact part that will also fail.

    • 0 avatar
      Art Vandelay

      “I hate updates, nothing good ever happens of them. I’ve had computers fail shortly after an update, so I won’t do them.”

      MS03-026, MS08-067, MS17-010. Google those. Then tell me nothing good comes from updates. I generally consider some rando not being able to click one button and have remote administrative access to my computer to be a positive of an update. You should also google Spectre and Meltdown and then update your BIOS.

      Seriously, The Tesla stuff is nonsense, but you should patch your computer man.

      • 0 avatar
        DenverMike

        Thanks Art, but my HP laptop is just a couple months old. But it’s already bugging for an update.

        The last one was the same HP, and it bugging me for months to do an update so I finally let it. Then every few minutes it would kick me offline and I’d have to click on the new icon that appeared on the task bar to get back online.

        I could’ve looked in to how to fix it, but the laptop was old (but fast) and would need a new battery soon.

        I hate HPs but I’m very familiar with their laptops and I’m not computer savvy. If it needs a patch it doesn’t show it.

        • 0 avatar
          Lie2me

          Don’t do it. Like I explained above I stopped all updates years ago on both my HP desktop and laptop, both have been problem free ever since and these are now both very old computers. I dread having to replace them at some point with a Windows 10 machine

      • 0 avatar
        JimZ

        I run unpatched Windows XP RTM with no firewall, and that’s the way I likes it!

        /s

        • 0 avatar
          DenverMike

          I run laptops “stock”, as-is and haven’t had a problem with viruses or attacks.

          I’ll download Google Chrome and that’s it. Whenever anything looks like a viral bug or lockdown, I’ll do a hard shutoff and it’s gone.

          Anything that offers to make changes to my computer, including updates, I’ll take a pass.

          • 0 avatar
            Art Vandelay

            If you don’t like the feature changes or whatever, fine. You can read the documentation for the updates and decide. Here is a hint…If it reads”…fixes a critical vulnerability that allows tor the remote execution of arbitrary code…” You want to apply that update.

            And if the attacker is any good, you won’t know they are there. This isn’t movie level stuff…most cyber criminals just want to steal your money or use your machine for distrubeted attacks. People not patching makes it easy.

            And no, when you do a shutdown, it definitely is not gone.

          • 0 avatar
            DenverMike

            Thanks. I just use computers like most would their Honda or Hyundai. You just want to buy and drive without tuners, deletes or mods.

            I don’t keep important personal info on my laptop, but if I’m wrong, I’m just out $300 for new laptop. Mine wear out quick anyway since they’re also my TV and stereo, they follow me around the yard, in the truck, etc.

            I’ve had 2 laptops fail from dog attacks.

          • 0 avatar
            JimZ

            ignorance is bliss, I guess.

          • 0 avatar
            Art Vandelay

            It’s not really the same as a mod…it is more of a recall in these cases. I could have kept on driving my F150 knowing that in an impact the seatbelt pretensioners may have set the truck on fire, but why would I do that? A Mod would be more akin to someone rooting their Android phone. That can introduce vulnerabilities and affect the user experience. But applying the monthly security fixes just keeps people from stealing your data or doing things like launch distributed Denial of Service attacks against entities like the CDC. Yes, if you are unpatched, an attacker can use your computer and millions of others to do that.

          • 0 avatar
            dal20402

            The right car metaphor for refusing to allow security updates to apply is removing emissions equipment.

            In today’s security environment, the update mechanism is an essential feature of any operating system. It protects not only the user but everyone else on the internet. Attackers can easily control unpatched computers without the user’s knowledge, and use them to do things like send torrents of spam or launch distributed denial of service attacks on your favorite websites.

            If you disable your updater and run with unpatched security holes, you’re spraying the virtual equivalent of soot or unburned fuel at everyone else on the net.

  • avatar

    We already discussed this issue to death. No need to repeat it every month. The key words here are: SW subscription model – all companies moving in this direction, and factory reset before selling vehicle or phone.

    Or non-transferable warranty for what Hyundai and Kia are famous for – no one make fuss about it at TTAC and we do not discuss it every month.

    • 0 avatar
      SCE to AUX

      H/K warranties are transferable. Instead of 10/100, it drops to 5/60 for second owners. That’s better than many new car warranties.

      I’ve bought a couple used H/K products with this provision.

  • avatar
    Lokki

    This is an interesting question. My 2019 5 Series comes with a variety of software subscriptions. Nav system maps, real time traffic, satellite radio, Apple CarPlay, and two or three more I can’t remember right now. Arguably the free maintenance for the first three years is also a subscription. After that the owner, whoever it is at that point must pay to continue receiving those benefits.

    The line on whether ludicrous mode is a software subscription or a purchased feature may take longer for the courts to decide than we would like.

    • 0 avatar
      Lie2me

      As long as people know up front that certain features aren’t transferable I don’t see a problem. I have a car that came with Sirius sat radio, I chose not to renew the subscription, so no more sat radio, but I knew that going in

  • avatar

    I wanted to buy a Tesla, but this, MCU wearing out, and the fact only one place can fix the car ? At least Benz won’t reprogram my ECU and reduce my HP overnight. I applaud Tesla for pushing the envelope, but no way would I trust them with near six figures…

  • avatar
    ToolGuy

    They can handle it either way they want, but they should be up-front about it. Besides re-sale, it should affect the residual [and thus the monthly lease payment] for brand-new vehicles which are leased. (Math follows.)

    Model S on the website today:
    – Long Range Plus $79,990; 36-month lease payment = $924
    – Performance [includes Ludicrous Mode] $99,990; 36-month lease payment = $1,224

    $300 lease payment difference * 36 months = $10,800. Divide this by the $20,000 up-front price difference and we get an ‘implied’ residual of 54% for the Performance ‘package’ [which is generally in-line with residual estimates for Model S as a whole].

    If the Performance features ‘disappear’ at the end of the lease term, the correct residual for the ‘package’ should be zero, and the Performance lease payment would be $1,480, an increase of $256 per month from the current quoted payment. [20,000/36=556; 556+924=1480] [Alternatively, 20K-10.8K=9200; 9200/36=256]

    I would not think ALG [Automotive Lease Guide sets lease residuals for many OEM’s] would be happy to hear about this (if the leases are being mispriced).

  • avatar
    MiataReallyIsTheAnswer

    Greedy-ass bastards.

  • avatar
    Jeff S

    I will not buy a Tesla ever and I doubt Tesla would want me as a customer. Teslas are overpriced and their attitude is you should be grateful that they are willing to let you buy one of their products and you should thank them for taking your money. I am not a fan of Detroit but I would trust GM and Ford before I would trust Tesla. GM and Ford will be coming out with their own EVs and yes GM already has the Bolt and honestly I would rather have a Bolt than anything Musk comes out with.

  • avatar
    Art Vandelay

    If these “Features” are a subscription model, I shouldn’t need to resubscribe when I byuy my new Tesla, correct? Subscriptions stay with the user. I buy these features, then I trade in my Tesla, tesla removes them from my old car and I use them on my new car if we are following the traditional model for this stuff.

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