Tesla Dealt ‘Black Eye’ in Recall of Cars Sold in China
(Bloomberg) -- Tesla Inc. will make a software fix to more than 285,000 cars in China, or most of the vehicles it delivered there in recent years, to address a safety issue identified by the country’s regulator.
In many cases the recall is expected to be done remotely with an online update to the cars’ active cruise control feature. Tesla will upgrade the software for free.
“This is a black eye for Tesla in a key China region which will be a headwind in the near term to overcome,” said Dan Ives, an analyst at Wedbush Securities. “It’s a lingering issue but clearly China put its foot down and Tesla needs to do a wide-scale recall.”
The State Administration for Market Regulation said in a statement on Saturday that the action would involve some 211,256 locally produced Model 3 vehicles and 35,665 imported ones, as well as 38,599 China-made Model Ys.
The cars’ autopilot systems can be activated automatically, potentially leading to crashes from sudden acceleration, the Chinese agency said.
“We apologize for the inconvenience caused by this recall to all car owners,” Tesla said in a notice through its official customer support account on Chinese social media platform Weibo. “Tesla will continue to improve safety in strict accordance with national requirements.”
Tesla has faced various setbacks in China over recent months. A protest at the Shanghai auto show in mid-April went viral, while there was concern a number of crashes would sour public opinion toward billionaire Elon Musk’s California-based company.
Some local governments and official institutions were also reviewing Tesla ownership among their staff, citing concerns that the cars pose security risks, Bloomberg News reported. Still, a sales surge of the China-made Model Y in May eased the worries to some extent.
Local registration data as of May shows Tesla delivered more than 275,000 imported and domestically-made Model 3s and Model Ys in China since 2019.
The action announced Saturday will include certain imported Model 3 cars produced between Jan. 12 and Nov. 27, 2019, some locally produced Model 3 made between Dec. 19, 2019, and June 7, 2021, and Model Y Teslas manufactured this year through June 7.
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