Tesla Inc.
TSLA 5.83%
recalls about 135,000 Model S luxury sedan vehicles and Model X sports utility vehicles due to faults on the touch screen, one of the biggest safety actions of the electric car manufacturer.
The move comes after the National Road Safety Administration last month called for a recall, saying the touchscreen could fail in some models if the memory chip is no longer stored, affecting features such as defrost, turn signal and driver assistance. The agency said the problem affected about 158,000 vehicles, including Model S sedans built between 2012 and early 2018 and Model X vehicles manufactured from 2016 to early 2018.
The reason for the difference between the NHTSA figure and the number of vehicles Tesla plans to recall was not immediately clear.
Tesla announced in a letter to federal regulators Tuesday that while it does not agree that the case is a lack of vehicles, it is continuing with a recall to complete the investigation and provide a better experience for customers .
“It is economically, if not technologically, feasible to expect such components to be designed or engineered to last the entire life of the vehicle,” Tesla said in the letter.
Although the recall will be modest compared to other car safety measures, which sometimes affect millions of vehicles, the action represents a relatively large number of Teslas. According to market research firm Motor Intelligence, the company delivered about 500,000 vehicles worldwide last year, of which about 40% are in the US. Tesla does not break out its sales by region.
The electric vehicle manufacturer recalled about 123,000 of its Model S cars in 2018 over the finding that some bolts corrode in cold weather, which could lead to steering failure.
Tesla is financially much better than three years ago. The company reported six profitable quarters in a row and its cash holdings amounted to approximately $ 19.4 billion at the end of last year. The market valuation of about $ 796 billion as of Monday was greater than that of the next nine largest automakers combined, according to a Dow Jones Market Data analysis from FactSet data.
Federal regulators have said the problem with Tesla’s touch screens could take about five to six years to manifest. Tesla tried to use over-the-air updates to fix the problem, but efforts were insufficient, regulators said.
About 12,600 vehicles have already experienced these touchscreen problems since last summer, when Tesla provided data to regulators. All the touch screens in the approximately 158,000 vehicles affected would eventually fail, the regulator said, it was told by Tesla.
The recall comes as the automotive industry struggles with a shortage of computer chips that have disrupted production worldwide.
Tesla said it would replace hardware for free as part of the recall, but would do so in phases due to parts.
Delivery of Model S and Model X vehicles, Tesla’s higher offering, has recently declined. The company said last week that it was refreshing both models.
Write to Rebecca Elliott by [email protected]
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