A US judge said Tesla car owners could file a proposed class-action lawsuit accusing the electric car company owned by billionaire Elon Musk of monopolizing repair and spare parts markets, breathing new life into a lawsuit that was already dismissed last November.
U.S. District Judge Trina Thompson in San Francisco ruled Monday that owners can try to prove that Tesla forced them to pay high prices and endure long waits to have their cars repaired for fear of losing warranty coverage.
The owners said Tesla's alleged coercion violated the federal Sherman Antitrust Act and California antitrust law.
Thompson found evidence of a repair monopoly in Tesla's alleged refusal to open a sufficient number of authorized service centers and in the design of vehicles that required diagnostic and software updates that only the company could provide.
The judge said evidence of a parts monopoly includes preventing original equipment manufacturers from selling to “anyone other than Tesla,” and Tesla selling parts to consumers on only a limited basis.
Thompson also found evidence that Tesla's alleged illegal “linking” of multiple markets “forces customers to make unwanted purchases.”
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The Tesla class action lawsuit suggests that the company is carrying out monopolistic actions
Tesla and its lawyers did not immediately respond to requests for comment on Tuesday.
They argued that the complaint was based on an “irrational theory” that Tesla intentionally reduced the level of repairs and parts, thereby jeopardizing more profitable car sales and leasing.
Matt Rowan, attorney for the plaintiff's owners, said they were pleased with the court's reasonable and thoughtful decision and looked forward to the next phase of the case.
The complaint brings together five lawsuits from vehicle owners who have paid for Tesla repairs and parts since March 2019.
The Austin, Texas-based company distinguished itself from competitors by insisting on handling service and parts, rather than allowing owners to use independent shops and parts from other companies, they said.
Tesla sells its cars directly to consumers, not through franchises.
It reported $8.3 billion in services and other automotive revenue in 2023, representing 9% of its total revenue of $96.8 billion. Total car sales reached $78.5 billion.
With information from Reuters
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