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Tesla’s Stock Takes a Hit: Major Recall Hits Over 1.8 Million Cars

Daniel Kim Views  

Yonhap News

Tesla’s stock price fell by over 4% yesterday. This decline followed news of a large-scale recall in the U.S. to unexpectedly address an issue with the front hood opening.

Tesla’s stock closed at $222.62 on the New York Stock Exchange, down 4.08% from the previous day.

The U.S. National Highway Traffic Safety Administration (NHTSA) reported that Tesla has discovered a software issue in some of its vehicles that prevents the system from detecting when the hood is open. As a result, Tesla is recalling about 1.85 million vehicles that may be affected.

Tesla attempted to resolve the issue in June with an over-the-air (OTA) software update. However, the updated software still detected the open hood, triggering a warning message for drivers.

The recall affects Model 3, S, and X vehicles from 2021 to 2024 and Model Y vehicles from 2020 to 2024. All these vehicles share a common feature of having hood latches produced by MagnaClosure in China.

According to Tesla’s recall report, the company began investigating in late March after receiving customer complaints in China about the hoods of Model 3 and Model Y vehicles opening spontaneously. The investigation revealed that a deformation of the latch switch prevented the driver from being alerted when the hood was open. For unknown reasons, Tesla noted that this issue occurred more frequently in China than in the European and North American markets.

Tesla stated that it received three reports of this issue in the U.S., but there have been no reports of accidents or injuries related to the recall.

This recall is Tesla’s largest since the December 2022 recall of 2.03 million vehicles to install new safety devices in its autopilot system.

Daniel Kim
content@viewusglobal.com

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