Tesla Inc (NASDAQ:TSLA) could be staring down the barrel of two class action lawsuits accusing the electric vehicle maker of designing its vehicles, warranties and repair policies to flush out competition.
Brought in a San Francisco federal court, the two cases allege Elon Musk’s EV giant has unlawfully curbed competition rules by essentially preventing its vehicles, and parts, from being repaired by non-company shops.
“Tesla’s monopolisation of the Tesla repair services and Tesla-compatible parts markets has led to artificially inflated prices, decreased supply, and burdensome wait times,” one of the court filings states.
Tesla “strongly recommends” customers use its own repair services, it goes on, or risk having “coverage excluded” under its warranty.
The company is yet to appear in court to fight the accusations but joins the likes of Harley-Davidson (NYSE:HOG) in being sued over potentially ignoring “right to repair” laws, while Apple U-turned in 2021 after a long battle over independent repair.
"Tesla needs to open up its ecosystem and allow competition for the servicing of Tesla and sales of parts," lawyer Matthew Ruan said.
Filings also call for Tesla's repair manuals and diagnostics tools to be made publicly available "at a reasonable cost".
The cases could include anyone who has paid Tesla for repairs since March 2019, with the two being filed on behalf of residents in California, potentially equating to hundreds of millions of dollars in damages, Ruan claimed.
Tesla shares fell 0.4% to US$179.7.