Tesla Service Now Includes Collision Repairs, Fulfilling Elon Musk’s 2018 Promise
Tesla notified customers on Friday that the company’s service centers will now offer collision repairs, something CEO Elon Musk had been talking about since 2018. Tesla reported $678 million from a combined Services and Other segment during the fourth quarter of 2020, but the company does not break out services revenue discretely. Service has been a sore point for many Tesla owners and retail investors in recent months, to the point where a retail investor asked executives on their earnings call Wednesday what the company plans to do to improve the service experience.
Elon Musk’s electric car company notified customers on Friday that Tesla Service Centers now offer collision repairs, something the company has been talking about since 2018.
In a message to customers entitled “Collision Repair is Here,” the company touted its ability to fix everything from dents and scratches to “suspension and axle damage” in its own service centers as an “alternative option to a body shop.”
Services, including collision repairs, should represent a bigger revenue segment for Tesla over time as its cars age out of warranty and the company delivers more of them around the world. While Tesla reported $678 million from a combined Services and Other segment during the fourth quarter of 2020, the company does not break out services revenue separately. Overall, that segment grew 17% from $580 million in the year-ago quarter.
Tesla operates 140 service centers in North America. The company is aiming to open more, including 46 in the first half of 2021, Tesla President of Automotive Jerome Guillen revealed on Wednesday.
Service has been a sore point for many Tesla customers in recent months, to the point where investors asked executives on the Q4 2020 earnings call, “What is Tesla doing to improve service experience? Tesla had a reputation for outstanding customer service. Now it’s impossible to even call a service center and appointments are scheduled weeks out.”
Guillen answered, “For us best service is no service. So we spent a lot of efforts trying to improve the quality and the reliability of our cars. In the last two years the frequency of service visits are reduced by one-third, so customers have to come less frequently into service, which is really the goal, no service.”
He emphasized that Tesla also offers “mobile service,” during which a Tesla service vehicle and auto mechanic go to a customer’s car to fix it. Mobile visits now represent 40% of all service visits in North America and Tesla wants that number to increase to 50% in 2021, according to Guillen.
But not all repairs can be done on a mobile visit. For example, replacing the panoramic glass roof on a Tesla vehicle must be done in a shop.
Guillen also said Tesla is pushing all customer communications about service through the Tesla app— meaning Tesla Service Centers now prefer not to or simply won’t take phone calls.
“The app is much better than the phone,” Guillen explained. “It can spot alerts directly from the car and schedule a service appointment. There is a written record of all communication between the customer and the service team. You can have pictures in there. You can take care of your payment without entering the credit card and doing all that stuff. You get updates on the service.”
Guillen predicted most other car companies will follow suit.
– CNBC