Jan 5, 2024 - Business

Tesla recalls 1.6 million vehicles exported to China to reduce collision risks

Tesla vehicles at a Tesla factory in Shanghai, China, in December 2023.

Tesla vehicles at a Tesla factory in Shanghai, China, in December 2023. Photo: CFOTO/Future Publishing via Getty Images

Tesla will recall more than 1.6 million of its vehicles that were exported to China to fix glitches with their automatic assisted steering and door lock controls, a Chinese regulator announced on Friday.

Why it matters: The recall in China over the glitches, which will be fixed with remote software updates, follows two other recalls in the U.S. last month involving millions of the company's electric vehicles that were experiencing similar issues.

  • With one of the U.S. recalls, the company updated the software for almost all of the cars it has sold in the country for a defect in a system meant to monitor whether drivers are paying attention while using the vehicle's Autopilot feature.
  • That update signaled that U.S. safety regulators are getting tougher on Tesla after multiple investigations were opened in recent years into collisions involving the Autopilot technology.

By the numbers: Friday's recall in China covered the same issue, with China's State Administration for Market Regulation saying 1.6 million Model S, Model X, Model 3 and Model Ys would be remotely updated to fix the automatic assisted steering flaw.

  • The regulator said the defect increased the risk of vehicle collisions by potentially allowing drivers to "misuse" the Autopilot functions.
  • Over 7,500 Model S and Model Xs produced between Oct. 2022 and Nov. 2023 will also be recalled and remotely updated to fix a bug that could allow the doors to become unlocked during a crash.
  • Last month, around 120,000 Tesla vehicles were recalled and remotely fixed for the same latch issue.

The big picture: China has become a crucial market for Tesla in recent years, even as other U.S. companies have curbed their investments in the country due to Beijing's restrictive COVID policies and to hedge against U.S.-China tensions.

  • Tesla announced a major expansion to its manufacturing facility in Shanghai last year, saying the "Megafactory" would be able to produce at least 10,000 battery units per year.
  • However, Tesla's sales have been overtaken by China-based automaker BYD, which emerged at the end of last year as the world's best-selling electric vehicle company.

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