[happytiger]

Rising cost of repairs are causing this as new car are becoming so complex and are so difficult to repair they are causing catastrophic loss to insurance companies.

Electric cars lead this change with eye watering repair costs, but just look at the cost of replacing the headlight on a 2024 f-150 — it is almost 1400 bucks, plus labor. Each. So a minor fender bender is thousands and for insurance you have to use approved parts, which are most always OEM and painfully expensive.

Cars are complicated and expensive to repair and getting more complicated. And manufacturers are doing strange things. Like the 2024 Lexus GX has a hutch included in every model (yay, finally), but then it sticks out several inches and is welded to the frame so even a minor fender bender can total the car — it’s the first thing that gets nailed when someone read ends it and it goes straight to the frame. That’s not a good plan, and could (in my opinion definitely will) lead to totaling the car from minor fender benders.

And electric cars in general are even more expensive to repair.

https://www.repairerdrivennews.com/2022/07/12/ccc-report-rep...

It all comes out in higher insurance costs.

[hn_throwaway_99]

I think there should be changes in laws that limit someone else's liability based on what you are driving.

For example, look at the viral report of a minor fender bender of a Rivian that was quoted for 40k in repairs. While going in-depth this particular instance looked more like border-line insurance fraud, I think it's ridiculous that if you decide to drive an exceedingly fragile (at least when it comes to repair costs) vehicle that other people on the road should be responsible for that. Like if I use a faberge egg as a hood ornament and someone dings it, do I get to sue them for a couple million?

It feels like limits on vehicle liability will at the very least force car makers to take repairability into consideration when designing their cars.

[happytiger]

That’s such the point. You’ve got one of the core issues about what is going articulated perfectly.

The problem is that the manufacturers are incentivized to build them with high repair costs based on how they make money… they make a ton from parts. And there are massive changes forecast for the parts market.

If you really want to dig in, and you may know all of this already, this is a great article outlining the transition currently happening for tier1 parts suppliers:

https://www.bcg.com/publications/2023/growth-strategy-tier-o...

All of these changes are coming out in the insurance industry, but the insurance industry is constrained by what insurance commissioners will allow, and of course there’s the point you are making at core — they’re not making parts affordable because it’s become a profit center for them. A lot of money is now being made in the backend as companies optimize their supply chains for BEVs.

Take a look at the New Strategies section of that article.

[jjtheblunt]

> And electric cars in general are even more expensive to repair.

Something has gone crazy over the past ten years: my 2014 BMW i3 over 79,900+ miles cost all of about $200 in maintenance, not including occasional new tires. EVs can be very frugal.

Is it profiteering and collusion now?

[aeternum]

Probably, Elon has some quote about how creating a successful new car company isn't hard because cars are hard to design.

It's hard because cars are generally sold with razor thin margins and all the money is made selling parts and service. Seems crazy but perhaps this is actually true.

[jjtheblunt]

(Upvoted) i think about exactly what you wrote, now with a 2024 electric BMW, in that clearly there is an initial excess cost (not because of being BMW) over similar ICE models (like i7 vs 7 series, m440 vs i4, etc.). And i think that excess cost passed to the buyer for electric over ICE effects includes the profit an ICE would have "earned" over time, because ev models have significantly simpler and less costly powertrains to build, and service. But, i can’t back up that guess with data.

[oliwarner]

But when the battery finally has a terminal issue, you're looking at a $30k quote to replace it. Or scrap the car. That's a real figure from this year for US i3 owners. But other cars are $20k+ too.

It's hard to offset long term expenses against car values, but it's certainly something am insurer needs to consider for liabilities.

[jjtheblunt]

BMW replaced The battery in my 2014 i3 (no rex, pure ev) in 2021 because of a faulty heat pump that let the battery roast in Arizona heat. They paid even though technically out of warranty and shipped the entire battery back to Germany to do forensics, and the work order showed $25k part cost, in summer 2021, that they spent, so that fits.

[jjtheblunt]

That’s not an insurance visible issue, but “normal wear and tear”, i bet.

[seanmcdirmid]

Your EV can probably last forever as long as you don't hit anything with it, or get hit by anything else. You'll need to get a new battery someday, but those might fall in price rather than become more expensive (assuming someone other than BMW can make them, which is a big open question).

[happytiger]

I am not debating potential or technology, but the higher industry repair costs.

Theory meets the road so to speak. I think it’s likely an artificially created profit center to keep the upfront cost of vehicles very low, as in Tesla’s case.

[r00fus]

I had a very inexpensive fix to my Ford Focus EV last year. Like less than $2k for being hit and spun, requiring repairs to 6-7 body panels.

EV manufacturers could make cars that are as durable as ICE ones but they choose not to - limited liability for such crashes is the way forward.

[happytiger]

The parts market transformation for tier-1 parts suppliers is far more complicated. What’s happening is that the legacy parts (panels) are coming from a different management pool than the EV components and parts suppliers are scrambling to change their strategies.

Take a look at how parts suppliers are segmenting their businesses and it will make sense (article below).

I completely agree with your conclusion, but none of the manufacturers have incentives that line up with limited liability.

https://www.bcg.com/publications/2023/growth-strategy-tier-o...

> Suppliers looking to formulate a successful portfolio strategy should begin with a careful review of their existing product groups, broadly allocated to three segments based on their growth and profitability outlooks.

- Booster parts. The major source of growth, this category includes such trend-driven parts as advanced driver assistance systems (ADAS), battery management systems (BMS), and fuel cells. These parts offer generally greater profitability, though profits will depend on the specific niche—higher for software, lower for increasingly commoditized segments like power electronics.

- Carry-over parts. These include a range of parts that will be predominantly trend-agnostic and stable, such as exterior parts, HVAC, seating, lighting, and the like. Profitability for this category will generally be stable.

- Legacy parts. These include ICE engine systems and conventional transmissions, exhaust systems, fuel systems, and older generations of electronics and human-machine interface (HMI) systems no longer applicable for connected cars—all of which are generally declining as a result of trends in mobility. In general, future profitability for this category of parts will be declining as suppliers struggle with overcapacity.

> Many tier-one suppliers will likely offer a mix of all three types of products. A proper portfolio strategy, however, will require the development of a separate, distinct strategy for managing each product group.

[r00fus]

I think this may be why manufacturers like Kia/Hyundai offered so many models that are ICE/hybrid/EV versions (see 2017-2022 Ioniq, Niro), now just ICE/hybrid/PHEV (Sportage, Sorrento). Could be their answer to parts availability contracts for their tier-1 suppliers.

[toast0]

> Like the 2024 Lexus GX has a hitch included in every model (yay, finally), but then it sticks out several inches and is welded to the frame so even a minor fender bender can total the car — it’s the first thing that gets nailed when someone rear ends it and it goes straight to the frame. [typos fixed]

A hitch needs to be strongly connected to the frame or it's not very useful for towing. Welded or bolted. Most factory hitches are just a bit inside the bumper though, not sticking out?

[namibj]

You could use a shear bolt or similar to fail without hurting the frame, or at least the frame tanking a decent number of those events (where the shear bolt fails each time) before fatigue limits make it unsafe to use afterwards.

[happytiger]

This is the way it’s always been done and it’s highly effective. The move to welding it to the frame doesn’t make it less reliable, it saves manufacturing cost and complexity.

[toast0]

I think I'd rather you bend your frame when towing inappropriate loads than the hitch intentionally shear off and your load goes independent on the highway.

[namibj]

We aren't talking "towing of inappropriate loads" levels here, and trailers heavy enough to cause such worries (by being too heavy for the frame of a, say, Prius, not just overloading the transmission/brakes) really ought to have their own brakes.

The only reason these forces don't already disintegrate the frame is that it's designed to absorb energy by deforming, so that if your stopped with you head nicely braced and a same model car (not truck!) rear-ends you perfectly straight with say 80-ish mph, you can have a chance of surviving, by way of your rear frame delaying the kick to your seat and sacrificially tanking a good part of the kinetic energy the other car brought to your situation.

Similarly, your front is designed to absorb energy to hopefully not rip your head off your neck if you run straight into a solid concrete wall, and do so while directing the crumpling to hopefully also not squish your legs (as you very quickly bleed out from the major blood vessels supplying your legs).

[happytiger]

The shear effect generally require forces far beyond trailer loads (think impact forces).

[shiroiushi]

>Like the 2024 Lexus GX has a hutch included in every model (yay, finally),

Why would you want one of these on your car? https://en.wikipedia.org/wiki/Hutch_(furniture)

[happytiger]

El typo struks again.

[shiroiushi]

Just like evolution is a product of simple mistakes in DNA replication, human innovation is frequently the result of simple mistakes. So this typo is likely to result in the next big trend in automobiles: built-in hutches! I'm sure some entrepreneur is working on it now.

[rasz]

>so complex and are so difficult to repair they are causing catastrophic loss to insurance companies.

in US maybe. Tons of companies in EU specializing in imports of "totaled" US cars. Totaled by cost calculated with magic insurance algorithms, but in real life easily fixable cosmetic/suspension/mechanical damage. Repairs are in $5-10K range for a $20K "totaled" car worth $50K when fixed. Money laying on the street waiting to be picked up.

Are US car insurance companies similarly limited by law to a certain percentage of profit like Healthcare? Because this does feel like car insurance companies are artificially inflating costs to bump premiums.

[happytiger]

They are limited by insurance rules in each state and federal. The patchwork of consumer protection regulation makes for a lot of weird effects, like the one you are discussing.

They are not limited in profit, but they are limited in what they can do, when they are required to total a car, etc.

[euroderf]

> just look at the cost of replacing the headlight on a 2024 f-150 — it is almost 1400 bucks, plus labor. Each.

This is how auto body collision costs use to be, before the feds stepped in. Remember those crazy huge old ornamental bumpers ? They drove the reform.

So... extend this regulation model.