Tesla Built a Secret ‘Diversion Team’ to Squash Exaggerated Range Complaints

Tesla is perhaps the most prolific EV maker in the world. With a software-first approach to electric cars, the Texas-based EV maker has attracted a lot of buyers. Couple that with fantastic advertised range and the largest charging network in the U.S., and it's no wonder that Tesla was able to take a huge bite out of traditional car sales. But new EV buyers are quickly finding that the real-world range of their new cars might not be as high as advertised, and as uncovered by a Reuters investigation, Tesla even resorted to building a secret team to thwart consumer complaints.

Speaking to Reuters, a person familiar with Tesla's internal workings claims that CEO Elon Musk ordered the range algorithm to see the world through rose-colored glasses... at least while the vehicle is above 50% state of charge.

“Elon wanted to show good range numbers when fully charged,” the source told Reuters. “When you buy a car off the lot seeing 350-mile, 400-mile range, it makes you feel good.”

These range estimates were optimistic, and when the vehicle dropped below 50% SoC, its algorithm started to present more realistic predictions, dropping the range much more quickly. It's not clear if Tesla still uses these range estimates, but it would appear that a number of customers are still unable to squeeze the advertised range out of Tesla's vehicles.

Tesla reportedly combated complaints from these customers by forming a so-called “Diversion Team” based in Las Vegas. When a customer attempted to open a support request in the app related to range, it would send the request to the Diversion Team—which dealt only with range cases—rather than the local service center.

This team was said to exist solely to handle complaints from customers who believed there were range issues with their cars. The advisers would run remote diagnostics on customers' vehicles and as long as there were no hardware-related range issues, they were trained to tell the customers that range estimates were just a prediction and that batteries degrade over time. Reuters says that if there were other issues found while running remote diagnostics, the Diversion Team was instructed to not tell the customer, cancel the service appointment, and close the case. And to celebrate successful cancellations, a supervisor reportedly purchased a metal-keyed xylophone that employees could strike whenever they convinced a customer to cancel their service appointments.

At one point, the team was said to be fielding around 2,000 range complaint cases each week and was expected to close at least 750. Employees were overwhelmed with cases and were reportedly instructed to no longer run remote diagnostic cases in the interest of time. Tesla eventually removed the ability for customers to schedule service visits for range complaints, leaving customers to be contacted by the team, and the team was reportedly instructed to close the case as "unresponsive" if they could not reach the customer by phone even once.

Tesla's argument here seems to be that there isn't actually an issue with the car's battery. Instead, it would appear that customers aren't getting the range they expect out of their new vehicles—so is the problem the car's hardware or the customer's expectation?

Much like gas cars, the range and efficiency of an EV can vary based on things like weather and how heavy a driver's foot is. New EVs also have to undergo federal labeling for their fuel economy, just like combustion-powered vehicles. ICE cars label their efficiency as miles per gallon (mpg), whereas EVs are labeled as miles per gallon of gasoline-equivalent (MPGe). Likewise, the total vehicle range is listed.

Manufacturers are able to generate the total range in one of two ways. First, the automaker can use a pre-defined EPA calculation based on MPGe numbers. But if the automaker feels that number is inaccurate—or perhaps if they believe they can generate more favorable results—the automaker can conduct additional tests. Gregory Pannone, a seasoned industry veteran with stints at Chrysler, General Motors, and BP throughout his career, says that the only reason that an automaker would choose to conduct additional tests is to "generate a more favorable estimate."

Ford, Mercedes-Benz, Porsche, and many other automakers use the standard EPA formula, according to Reuters. Mercedes even told Reuters that it uses the EPA formula because it finds that it provides "a more accurate estimate." The EPA must still approve the final window sticker number and routinely audits between 15% and 20% of all new EVs to ensure that it comes to the same conclusion. Since 2020, the EPA has tested six Tesla models.

Recently, SAE International published a study co-authored by Pannone which showed that, on average, EVs fall short of their advertised range at highway speeds by approximately 12.5% across the industry. Tesla, according to Pannone, fell significantly above the average rate. In fact, the study showed that three separate Tesla models averaged a loss of 26% over their advertised range at highway speeds.

“I’m not suggesting they’re cheating,” said Pannone. “What they’re doing, at least minimally, is leveraging the current procedures more than the other manufacturers.”

Similar to Pannone, Edmunds decided to test just how well Tesla's vehicles held up to the automaker's range estimates back in 2021. Edmunds tested six vehicles, running each one from 100% to 0% and observing the distance traveled. None actually achieved their EPA-stated range. After the test results were published, Tesla complained to Edmunds that the stated range actually included a 15-mile safety buffer—which, to be clear, no normal person would use in the real world for day-to-day driving—that begins when the vehicle hits zero miles remaining. Edmunds once again tested the vehicles, and only two reached their stated range when taking the safety buffer into account.

Jonathan Elfalan, Edmunds vehicle testing director, says that it has continued to test EVs since 2021 and no Tesla vehicle has met its EPA estimated range.

“They've gotten really good at exploiting the rule book and maximizing certain points to work in their favor involving EPA tests,” said Elfalan in a statement to Reuters. Elfalan said that by working the system, Tesla could potentially “misrepresent what their customers will experience with their vehicles.”

South Korean officials fined Tesla $2.2 million earlier this year after it deemed that Tesla exaggerated the "driving ranges of its cars on a single charge, their fuel cost-effectiveness compared to gasoline vehicles as well as the performance of its Superchargers." The country's antitrust regulators noted that the driving range could degrade as much as 50.5% in cold weather versus their advertised normal driving range, and it was not advertised that the range could dip in freezing weather.

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