Bought a model Y that I thought had clean title and found out it was salvage

[stopcrazypp]

Did you click the link I posted? The OP said IAAI reported the car to NMVTIS as a salvage car the day the auction closed and the car sold. They would only do this at Tesla’s explicit direction.

The way I read the post is they do that for every single sale through them, without requiring Tesla's direction. They say explicitly they do that even for clean title vehicles.

It takes weeks for title transfer to Prime Sales and then to the owner, so we don’t know yet if IAAI put the brand on the title. But it is no assumption that IAAI reported the car as salvage to the national car salvage database on 5/3, when Prime Sales bought it.

The first two steps in your assumption path are incorrect, based on the facts the OP shared and how auctions operate. You also have a few false assumptions about title management and reporting, but that is moot given the first couple data points.

I guess we will see what will happen to warranty and see who's right. I just don't see how OP was able to reverse the supercharger status if it was really salvage.

 

[Mrbrock]

Did you click the link I posted? The OP said IAAI reported the car to NMVTIS as a salvage car the day the auction closed and the car sold. They would only do this at Tesla’s explicit direction. It takes weeks for title transfer to Prime Sales and then to the owner, so we don’t know yet if IAAI put the brand on the title. But it is no assumption that IAAI reported the car as salvage to the national car salvage database on 5/3, when Prime Sales bought it.

The first two steps in your assumption path are incorrect, based on the facts the OP shared and how auctions operate. You also have a few false assumptions about title management and reporting, but that is moot given the first couple data points.

The owner or agent of the car declares it as a salvage. Insurance was probably not involved, but that is irrelevant. Tesla took the car back from the original lease a year before the accident. Tesla had owned it for a while apart from the lease. And even in the case of the 2 mile car, if Tesla declared it a salvage and sent it to a salvage auction, it is a salvage car regardless of what anyone thinks about the extend of the damage.

That is the definition of salvaged. It costs too much to fix vs the value of the car. If Tesla is reporting a dent costs $40,000 to fix that is misrepresenting the value of the vehicle or the cost of the repair. They don't just get to declare it, they have to go through legal channels to declare it a savage which carries a legal definition that has to be met. Maybe states aren't following up but that doesn't clear Tesla of wrongdoing. Cars in this case shouldn't be called salvaged.

What Is a Salvage Title Car and Should I Buy One?

A salvage title car is an official indication that a vehicle has been damaged and is considered a total loss by an insurance company that paid out on a damaged vehicle claim. Find out more about salvage title cars and if you should buy one.

www.experian.com

Salvaged vehicles | Washington State Department of Licensing

www.dol.wa.gov

 

[exxxviii]

The way I read the post is they do that for every single sale through them, without requiring Tesla's direction. They say explicitly they do that even for clean title vehicles.

I guess we will see what will happen to warranty and see who's right. I just don't see how OP was able to reverse the supercharger status if it was really salvage.

That’s not the way auctions work. The seller determines the salvage status, and that is how the auction runs the car. IAAI is a salvage auction, so sellers would not bring their cars unless they are salvage. Tesla has precedent for restoring SC access to salvage cars. I’m not aware of any precedent posted here for restoring warranty on a salvage car.

That is the definition of salvaged. It costs too much to fix vs the value of the car. If Tesla is reporting a dent costs $40,000 to fix that is misrepresenting the value of the vehicle or the cost of the repair. They don't just get to declare it, they have to go through legal channels to declare it a savage which carries a legal definition that has to be met. Maybe states aren't following up but that doesn't clear Tesla of wrongdoing. Cars in this case shouldn't be called salvaged.

You are mistaking an insurance company’s process for declaring salvage from the fact that any car owner can declare a car salvage. They can literally declare it, it is literally that simple; there are no legal channels, other than a title clerk simply following a state’s normal title processes. In these examples, Tesla decided to declare the cars salvage, and the IAAI handled the sale and salvage reporting on Tesla’s behalf.

 

[Hormold]

After last email from Tesla, they don't send any updates to car.
But I found a way to make a force config update on car. Just cancel and buy a premium connectivity again.
Now Trip Planner back to Navigation Manu and supercharger works perfect, like it should be.

 

[stopcrazypp]

That’s not the way auctions work. The seller determines the salvage status, and that is how the auction runs the car. IAAI is a salvage auction, so sellers would not bring their cars unless they are salvage.

Not true according to their own website and also the disclaimers posted a few times.

From their website:
"IAA sells lightly damaged, salvage and clear-title vehicles, parts cars, trucks, SUVs, motorcycles and heavy equipment at auctions across the United States. Preview our huge selection of vehicles free of charge then register to view auctions and bid."
Online Car Auctions: Salvage, Repairable & Used | IAA-Insurance Auto Auctions

Seems like companies use them to auction off even vehicles they don't total.

Disclaimer says IAAI only reports to the NMVTIS as a junk/salvage auctioner, as such every sale reported ends up reporting as such.

Tesla has precedent for restoring SC access to salvage cars.

Unless the title is proven clean and they made a mistake, they will not restore it without doing a salvage inspection (an inspection which the OP has not done).
Tesla to allow salvaged vehicles back on Supercharger network
Here's a different case that they restored it based on a proven clean title, with no actual salvage inspection, meaning they canceled the salvage status (not the same as certified salvage).
Clean Title, 10k Damage Accident, but Tesla Claims Salvaged Title

I’m not aware of any precedent posted here for restoring warranty on a salvage car.

Most of the cars that this happens to are older cars (for example that one I linked is a 2019), as such warranty has either expired or it's close enough to expiring the posters may not inquire about the warranty. I guess we will see what happens in this case given it's a newer car at 2021.

You are mistaking an insurance company’s process for declaring salvage from the fact that any car owner can declare a car salvage. They can literally declare it, it is literally that simple; there are no legal channels, other than a title clerk simply following a state’s normal title processes. In these examples, Tesla decided to declare the cars salvage, and the IAAI handled the sale and salvage reporting on Tesla’s behalf.

But the point I'm making is DMV has no record of them declaring it as salvage (which by CA law they are required to do in 10 days of making such a determination, regardless if they used a insurance company or if they self insured). As such legally it's a clean vehicle, presuming the OP has checked the most recent status at DMV.

 

[exxxviii]

Not true according to their own website and also the disclaimers posted a few times.

From their website:
"IAA sells lightly damaged, salvage and clear-title vehicles, parts cars, trucks, SUVs, motorcycles and heavy equipment at auctions across the United States. Preview our huge selection of vehicles free of charge then register to view auctions and bid."
Online Car Auctions: Salvage, Repairable & Used | IAA-Insurance Auto Auctions

Seems like companies use them to auction off even vehicles they don't total.

Disclaimer says IAAI only reports to the NMVTIS as a junk/salvage auctioner, as such every sale reported ends up reporting as such.

Unless the title is proven clean and they made a mistake, they will not restore it without doing a salvage inspection (an inspection which the OP has not done).
Tesla to allow salvaged vehicles back on Supercharger network
Here's a different case that they restored it based on a proven clean title, with no actual salvage inspection, meaning they canceled the salvage status (not the same as certified salvage).
Clean Title, 10k Damage Accident, but Tesla Claims Salvaged Title

Most of the cars that this happens to are older cars (for example that one I linked is a 2019), as such warranty has either expired or it's close enough to expiring the posters may not inquire about the warranty. I guess we will see what happens in this case given it's a newer car at 2021.

But the point I'm making is DMV has no record of them declaring it as salvage (which by CA law they are required to do in 10 days of making such a determination, regardless if they used a insurance company or if they self insured). As such legally it's a clean vehicle, presuming the OP has checked the most recent status at DMV.

I wrote my likely flow of events above in hope that the OP/buyer would see it and not give up his pursuit of Prime Sales to unwind the sale. Prime Sales almost certainly misrepresented the car.

This comes from my many years of experience in the wholesale automotive industry. I have been to dozens of auctions across North America and a few in the UK. I have consulted with auction GMs & AGMs, front office, back office, inspections, shop, auctioneers, title clerks, buyers, and sellers - nearly every aspect of auction operations. I stood up a remarketing organization, including obtaining their dealer license, that sells tens of thousands of cars a year. I developed analytics models to detect dealer fraud. I am familiar with these businesses, and your counterpoints do not reflect how auctions and title management actually happens, and I have covered most of them above already.

Just the last point about DMV having no record of salvage has errors and false assumptions. Tesla's warranty does not require a clean or unclean title, so that whole bullet is moot. Tesla explicitly states any car declared as salvage, independent of title status, would invalidate warranty. IAAI declared it salvage in NMVTIS on Tesla's behalf and at Tesla's direction. IAAI probably did the same with the title when they transferred the title on Tesla's behalf to Prime Sales, but the OP/buyer may not have the new title yet, so we don't know. Title processing through CA is extridanorily slow, so it could take months before the OP/buyer receives the title.

 

[exxxviii]

Yes I have been reading the whole story but still went and discussed with IAAI the issue and they did agree that such information should be listed. They will not take full responsibility but they are trying to make it clear for the next Tesla viechles.
It seems Tesla had the car at their lot and after the damage they reported it to themselfs and later send it to the auction.

Did you buy the car at IAAI directly or did you use a broker?
When you met with them, whom did you talk with (arbitrations, front office, dealer services, GM)?
Did they tell you if they reported the salvage at time of sale to NMVTIS and why?
Can you get a copy of the car’s announcements and lights when it ran?

Most auctions follow NAAA arbitration guidelines. You have a small window of time to open an arbitration case if the seller misrepresented the car or the auction made a mistake, so find out what that is and get it started before the clock expires.

 

[Ivan009]

Did you buy the car at IAAI directly or did you use a broker?
When you met with them, whom did you talk with (arbitrations, front office, dealer services, GM)?
Did they tell you if they reported the salvage at time of sale to NMVTIS and why?
Can you get a copy of the car’s announcements and lights when it ran?

Most auctions follow NAAA arbitration guidelines. You have a small window of time to open an arbitration case if the seller misrepresented the car or the auction made a mistake, so find out what that is and get it started before the clock expires.

Bought directly from IAAI with dealer license.
I have talked to the front office and they stated that nothing was reported. To this day noone is saying if they reported it or not. They are trying to blur the case with the excuse that cars are sold As is" but to not report a Branded title in California is illegal so I am hoping to get them on that. I will get some more detialed reply today or tomorrow and update.

Anyway i see more cases of new Teslas bought at 2mil which is strange. How is possible that 50% of low millage Teslas at auctions accross all stats are at 2mil. Something is not quite right with the Teslas and I will dig down to see what is going on.

 

[exxxviii]

Bought directly from IAAI with dealer license.
I have talked to the front office and they stated that nothing was reported. To this day noone is saying if they reported it or not. They are trying to blur the case with the excuse that cars are sold As is" but to not report a Branded title in California is illegal so I am hoping to get them on that. I will get some more detialed reply today or tomorrow and update.

Anyway i see more cases of new Teslas bought at 2mil which is strange. How is possible that 50% of low millage Teslas at auctions accross all stats are at 2mil. Something is not quite right with the Teslas and I will dig down to see what is going on.

Ooof, if they ran it As-Is, you probably cannot make a case for arbitration. Did you do an NMVTIS lookup at a site like VINCheck® Lookup | National Insurance Crime Bureau. Did your salvage record get posted the day of your sale. If so, it is almost certain that IAAI did it and they did at at the direction of the seller. Most US auctions get limited power of attorney from the sellers to handle everything about the sale and transfer of the cars.

Do you have your new title yet? Sometimes that takes a while, especially in CA. Since you bought the car with a dealer's license, I assume that they will transfer title to your dealership and then you will have to again transfer the title to you personally from your dealership. I wonder if IAAI is required to also post brand to the title when they transfer title to the buyer/dealer, or if it is the dealer's obligation to post the brand to the title. (Most US auctions only sell to licensed dealers, so it can get a little messy for auctions that also sell to the public.)

You are right that by CA law, dealers are required to post the history and branding. Since you bought it with a dealer license, I wonder if you or the auction is expected to put the brand on the title according to CA law. CA law requires licensed dealers to obtain an NMVTIS report and post a disclaimer if it is reported as junk or salvage. The quirk is the title brand... where does that actually come from - is it just an insurance thing, since insurers probably brand titles in the vast majority of cases? If so, NMVTIS is gospel and there could be cases where cars are self-declared as salvage without insurance in the ownership path.

I have an upcoming project to help a client build a national, centralized title management platform. I intend to ask about title branding (particularly in CA) purely out of curiosity, when that project is underway...

 

[zoomer0056]

other than a title clerk simply following a state’s normal title processes.

This means the title should reflect salvage status. So apparently, Tesla did not do this. Also apparently, IAAI did not do this. Buyer beware is the moral of this story. Snake oil sales people everywhere.

 

[exxxviii]

This means the title should reflect salvage status. So apparently, Tesla did not do this. Also apparently, IAAI did not do this. Buyer beware is the moral of this story. Snake oil sales people everywhere.

Tesla would not be the one to do this...

Branding a title probably occurs at time of title transfer. In the case of an insurance claim, the insurer buys the car from the owner and handles transfer of the title from the owner to the insurance company. At that time, they could brand the title. Or, they could wait and brand the title when they sell the car to the eventual owner. But, in the case of an auction, the seller does not do any of the title management. Auction sellers give limited power of attorney to the auction to handle the sale and title. So, the brand ideally should occur when the auction transfers title from the seller (Tesla) to the dealer.

Here's where it gets interesting... in most cases, auction buyers are licensed dealers and it may be their obligation to put the brand on the title based on the information disclosed at auction and the NMVTIS data. Auctions may not be legally obligated to brand titles during transfer, as long as they reported everything above board to the buying dealer. So, the fault may fall squarely and solely on the purchasing dealer.

 

[zoomer0056]

Tesla would not be the one to do this...

Branding a title probably occurs at time of title transfer. In the case of an insurance claim, the insurer buys the car from the owner and handles transfer of the title from the owner to the insurance company. At that time, they could brand the title. Or, they could wait and brand the title when they sell the car to the eventual owner. But, in the case of an auction, the seller does not do any of the title management. Auction sellers give limited power of attorney to the auction to handle the sale and title. So, the brand ideally should occur when the auction transfers title from the seller (Tesla) to the dealer.

Here's where it gets interesting... in most cases, auction buyers are licensed dealers and it may be their obligation to put the brand on the title based on the information disclosed at auction and the NMVTIS data. Auctions may not be legally obligated to brand titles during transfer, as long as they reported everything above board to the buying dealer. So, the fault may fall squarely and solely on the purchasing dealer.

Buyer beware.

 

[Occhis]

So what should prospective individual buyers look for, in order to avoid a situation like this, or at least minimize the risk?

 

[exxxviii]

So what should prospective individual buyers look for, in order to avoid a situation like this, or at least minimize the risk?

That is tough... Short answer is buy used cars from franchise dealers, major national brands (Carmax, Carvana, Vroom, Sonic, Penske, etc.), or local used dealers with a very high local reputation.

The long answer is that there are around 70K licensed dealers in the US. The major of those won't exist in three years (very high churn). There are probably 7K to 10K US dealers that are in it for the long haul and focus on selling high-quality cars.

If you buy from a 2nd-tier dealer, then ask a lot of questions about the origin of the car, NMVTIS status, get the Carfax and AuthCheck, etc. (Professional auction buyers use both Carfax and AutoCheck.)

Never buy from a salvage auction.

Never buy from a auto auction directly or through a broker unless you are a highly experienced buyer (or your broker is highly experienced with years and thousands of cars buying experience).

 

[zoomer0056]

So what should prospective individual buyers look for, in order to avoid a situation like this, or at least minimize the risk?

Good question! I did not know about IAAI or how salvage sales happened before reading this thread. More cynical I am now. I think basic to all things is don't act quickly (most of the time) or emotionally (ha!). Before jumping, research. Things change all the time. One phrase comes to mind: trust but verify.

 

[stopcrazypp]

I wrote my likely flow of events above in hope that the OP/buyer would see it and not give up his pursuit of Prime Sales to unwind the sale. Prime Sales almost certainly misrepresented the car.

This comes from my many years of experience in the wholesale automotive industry. I have been to dozens of auctions across North America and a few in the UK. I have consulted with auction GMs & AGMs, front office, back office, inspections, shop, auctioneers, title clerks, buyers, and sellers - nearly every aspect of auction operations. I stood up a remarketing organization, including obtaining their dealer license, that sells tens of thousands of cars a year. I developed analytics models to detect dealer fraud. I am familiar with these businesses, and your counterpoints do not reflect how auctions and title management actually happens, and I have covered most of them above already.

I don't doubt your experience, just posting counterpoints and actual cases where people were able to get Tesla to reverse the salvage status in their database by proving a car has a clean title. There haven't been an example of this yet for warranty, but the OP may be the first case (given success for supercharging).

Just the last point about DMV having no record of salvage has errors and false assumptions. Tesla's warranty does not require a clean or unclean title, so that whole bullet is moot. Tesla explicitly states any car declared as salvage, independent of title status, would invalidate warranty. IAAI declared it salvage in NMVTIS on Tesla's behalf and at Tesla's direction. IAAI probably did the same with the title when they transferred the title on Tesla's behalf to Prime Sales, but the OP/buyer may not have the new title yet, so we don't know. Title processing through CA is extridanorily slow, so it could take months before the OP/buyer receives the title.

The point about bringing up the law is that the insurer, self-insurer, or owner is required by law to report it to the CA DMV within 10 days of making a total loss determination:

https://codes.findlaw.com/ca/vehicle-code/veh-sect-11515/

They don't have to wait for a title change from a sale and it's not the responsibility of the buyer (Prime Sales). As such, if DMV has no such record 2 months after the sale, Tesla or their insurance have either violated the law or they never made a total loss determination in the first place. The reason I lean toward the latter is because OP was able to get supercharger reversed with no inspection, which suggests to me the salvage label did not originate from Tesla.

Maybe OP can clarify when was the last time he checked with CA DMV.

 

[exxxviii]

I don't doubt your experience, just posting counterpoints and actual cases where people were able to get Tesla to reverse the salvage status in their database by proving a car has a clean title. There haven't been an example of this yet for warranty, but the OP may be the first case.

Got it. We actually agree on this point and I had written the same in one of the posts you responded to. It seems like Tesla is getting away from blocking salvaged cars from SC access. And yeah, if Tesla decided to salvage the car, it seems highly unlikely they would restore warranty.

The point about bringing up the law is that the insurer, self-insurer, or owner is required by law to report it to the CA DMV within 10 days of making a total loss determination:

They don't have to wait for a title change or a sale and it's not the responsibility of the the buyer (Prime Sales). As such, if DMV has no such record 2 months after the sale, Tesla or their insurance have either violated the law or they never made a total loss determination in the first place.

I don't think we know yet if this didn't happen. And second, if it was required and didn't happen, I don't think we know if it is Tesla's or IAAI's responsibility. We do know that the purchasing dealer has a legal obligation to pull the NMVTIS history and share that with prospective consumers buying the car. In both of these cases, we know that the cars got their required NMVTIS updates at time of sale at the auction.

I am pretty confident that a 10-day clock, if applicable, would have begun at the time of sale to buying dealer. Up to that moment, the sellers could have changed their minds and chosen to sell the cars as either repaired or as-is with damage (but not salvage).

You do make a strong point in your last sentence - it is entirely possible that these sales were not required to have a branded title, that the NMVTIS postings alone were legally sufficient under CA law, and that Tesla and IAAI accurately fulfilled their legal responsibilities in these transactions.

 

[Mrbrock]

That’s not the way auctions work. The seller determines the salvage status, and that is how the auction runs the car. IAAI is a salvage auction, so sellers would not bring their cars unless they are salvage. Tesla has precedent for restoring SC access to salvage cars. I’m not aware of any precedent posted here for restoring warranty on a salvage car.


You are mistaking an insurance company’s process for declaring salvage from the fact that any car owner can declare a car salvage. They can literally declare it, it is literally that simple; there are no legal channels, other than a title clerk simply following a state’s normal title processes. In these examples, Tesla decided to declare the cars salvage, and the IAAI handled the sale and salvage reporting on Tesla’s behalf.

Ugh, the LEGAL definition of salvage (which since we are talking about titles means legal) is that there is damage to the car that will cost more to repair than it is worth. How do you get the worth of a vehicle without having it appraised and the damage appraised? This is all done through insurance appraisers/adjusters. While an individual can file the paperwork, there stills needs to be value and damage assessment done at some point.

In your world, an individual and car company can write their own titles and do whatever they want. Not true. Also, why would anyone willingly declare their vehicle salvage unless you are trying to scam an insurance company? It will hurt the value which means less money in your pocket.

 

[exxxviii]

Ugh, the LEGAL definition of salvage (which since we are talking about titles means legal) is that there is damage to the car that will cost more to repair than it is worth. How do you get the worth of a vehicle without having it appraised and the damage appraised? This is all done through insurance appraisers/adjusters. While an individual can file the paperwork, there stills needs to be value and damage assessment done at some point.

In your world, an individual and car company can write their own titles and do whatever they want. Not true. Also, why would anyone willingly declare their vehicle salvage unless you are trying to scam an insurance company? It will hurt the value which means less money in your pocket.

No. Any car owner, independent of an insurance company, can declare their car a salvage by sending a form and $15 to CA DMV. Another poster linked to CA vehicle code about this at least four times. CA code does not require any of the stuff you added, unless you are a lawyer and are aware of something more than what is writtten in California Code, Vehicle Code - VEH § 11515.

As to the 2nd question, I have no clue why Tesla would salvage what appeared to be a perfectly fine car. They intentionally sent the car to a salvage auction and had them declare it salvage to NVMTIS. If they had sent it to Manhem Riverside or Manhem California, they would probably have got $5K - $10K more, without doing repairs. Total mystery.

 

[Mrbrock]

No. Any car owner, independent of an insurance company, can declare their car a salvage by sending a form and $15 to CA DMV. Another poster linked to CA vehicle code about this at least four times. CA code does not require any of the stuff you added, unless you are a lawyer and are aware of something more than what is writtten in California Code, Vehicle Code - VEH § 11515.

As to the 2nd question, I have no clue why Tesla would salvage what appeared to be a perfectly fine car. They intentionally sent the car to a salvage auction and had them declare it salvage to NVMTIS. If they had sent it to Manhem Riverside or Manhem California, they would probably have got $5K - $10K more, without doing repairs. Total mystery.

No. Did you read 11515? The only way you can claim salvage without it beping declared as a total loss by an insurance company is for you to be a self-insurer. Either $35k cash deposit with dmv or net worth over $2.2mil and 25 or more vehicles. Cars are insured, you don’t get to make unilateral decisions about them without the insurance company. Just because the section says an owner can declare doesn’t mean they aren’t claiming a legal definition. If you read the legal definition (since you want to quote vehicle code, there are legal definitions that you have to abide by when declaring a vehicle is salvaged), salvaged actually is Total Loss Salvage.

If your vehicle has not been determined a total loss salvage and you sign the form for the DMV, you are falsifying a legal government document. In the case of these vehicles, Tesla didn’t claim they were a total loss so they should be sold as a clean title. Them blacklisting them after the fact is BS. If they want to claim salvage, then they need to file the proper paperwork.

Law section

California Drivers Are Not Necessarily Required to Have Auto Insurance — Conejo Valley Guide | Conejo Valley Events

Yes, it is true, technically, the law does not state that drivers in California MUST carry auto insurance. However, California Vehicle Code Section 1656.2 does have certain "compulsory financial responsibility" requirements most easily met by maintaining valid auto liability insurance

www.conejovalleyguide.com