$5.5 Million Order For 100 Tesla Model 3s Falls Through Over Quality Issues

A huge deal between German rental company NextMove, who wanted to add 100 Model 3s to its fleet, and Tesla fell through after the former was displeased with the quality of the cars.

NextMove placed the 5-million-euro ($5.5 million) order order back in 2018, but after taking delivery of the first 15 Model 3s earlier this year had issues with their quality. The two companies discussed how to fix them, but apparently didn’t come to an agreement.

According to the rental company, it was Tesla that canceled the order for the remaining 85 cars. The car maker, however, disputes that, saying that it was Nextmove that chose not to take delivery of the cars, according to Reuters.

NextMove claims that the 15 Model 3s it took delivery came with paint defects, faulty wiring, scratches on the dash, condensation in the headlights and more. A dispute followed between the two on how to fix those shortcomings, with the rental company claiming that Tesla set a “24-hour ultimatum”, triggering a refund clause.

The company did try to acquire an additional four examples of the Model 3 following the collapse of the deal, but Tesla wanted to sell them cars that had already been registered, meaning that NextMove would not be eligible for Germany’s EV incentive program and potential tax refunds.

Tesla, on the other hand, claims that it was in the process of resolving the quality issues and had provided the rental company with replacement vehicles.

“We believe the customer’s decision not to take delivery of its remaining Model 3 orders wasn’t entirely due to quality issues, but was largely influenced by their frustration with an unrelated dispute from earlier in the year,” Tesla said in a statement.