Tesla recalling 1.6M cars in China over Autopilot crash risk

The Chinese recall, which will be fixed with an over-the-air update, is similar to one taking place in the U.S.

The above photo documents a 2018 Mountain View, California, crash. According to the report from the National Transportation Safety Board (NTSB), the accident was the result of the “Tesla Autopilot system steering the sport utility vehicle into a highway gore area due to system limitations, and the driver’s lack of response due to distraction likely from a cell phone game application and overreliance on the Autopilot partial driving automation system.” Credit: NTSB

(Bloomberg) — Tesla Inc. recalled virtually every car it has ever sold in China due to issues with the driver-assistance system Autopilot that increase the risk of crashes.

The carmaker will deploy an over-the-air software fix to more than 1.6 million vehicles produced between August 2014-December 2023, including locally built Model 3s and Model Ys and imported premium models, the State Administration for Market Regulation said in a statement.

Tesla drivers may misuse Autopilot functions, increasing the risk of collisions and posing safety risk, the regulator said. The recall closely mirrors the carmaker’s response last month to the U.S. National Highway Traffic Safety Administration determining that it wasn’t doing enough to ensure drivers were using Autopilot correctly. NHTSA said it would keep open a years-long defect investigation to monitor the efficacy of the company’s fixes to 2 million cars.

John Turner, global director of crisis management for claims services provider McLarens, said more recalls of this nature can be expected as automakers lean further into new technologies when designing new vehicles.

“Software and new tech system issues are a key concern for the entire automotive sector,” Turner told PropertyCasualty360.com. “As with all innovations, there are lessons to learn and much R&D to do before products hit the streets, but even then, the streets provide the real acid test.”

While an over-the-air update is cheaper than having drivers bring vehicles to a dealer for repairs, the scope of the recall will make it an expensive endeavor, Turner said.

“Even an OTA-related software update remedy will be costly when covering two million vehicles, and for the culpable component or software supplier, if one is partly or wholly to blame, they will likely be under pressure from Tesla to provide reimbursement,” Turner said.

A Shanghai-based Tesla representative did not immediately respond to a request for comment. The carmaker’s shares fell as much as 1.1% before the start of regular trading Friday.

Tesla’s automated-driving systems have been subject to growing scrutiny after hundreds of collisions, some of which resulted in fatalities.

Tesla also recalled 7,538 Model S sedans and Model X sport utility vehicles in China to prevent door latches from disengaging during a collision. This fix to vehicles produces between October 2022-November 2023 also will be carried out via an over-the-air software update.

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