Tesla has initiated a recall of approximately 9,100 Model X SUVs in the United States due to a potential safety hazard involving a roof trim that could detach, posing a risk on the road and increasing the likelihood of accidents. This recall specifically impacts 2016 Model X vehicles, marking the second instance of such recall since 2020.
Examining the Recall Details
The National Highway Traffic Safety Administration (NHTSA) highlighted that the front and center roof trim pieces might have been affixed without primer, making them prone to separations. Tesla responded by announcing that the recall targets Model X SUVs from the 2016 model year.
Furthermore, the electric vehicle manufacturer stated that its supplier implemented a process alteration in July 2016 to prevent this issue in subsequent models. Additionally, the company assured that it would inspect the adherence of the roof trim on affected vehicles and reattach the trim if necessary, without any cost to the owners.
Tesla acknowledged approximately 170 incidents related to this matter but emphasized that no crashes or injuries have been associated with it. Notably, this marks Tesla’s first physical recall of vehicles, as the company typically addresses issues through over-the-air software updates.
Analysis of Tesla’s Escalating Recalls
Reportedly, Tesla has recalled 2.6 million cars during the first half of the year, as indicated by a Reuters report citing data from Bizzycar. This places Tesla just behind Ford Motor, which recalled approximately 3.6 million vehicles in the U.S. within the same period.
The mounting recalls by the company might have further repercussions on its sales in the U.S. Tesla’s sales in the country have already experienced a notable deceleration due to heightened competition, with the aging electric vehicle lineup prompting numerous customers to opt for newer models.
According to data from market research firm Cox Automotive, Tesla observed a 6.3% year-over-year decline in U.S. sales during the second quarter, totaling 164,000 units.
Evaluating Tesla’s Investment Position
Analysts currently hold a neutral stance on TSLA stock, with a Hold consensus rating consisting of 10 Buy recommendations, 14 Holds, and 7 Sells. Year-to-date, TSLA has witnessed a decline of over 10%, with the average price target of $211.46 indicating a potential downside of 4.3% from its current valuation.
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