Tesla's Bad Week Gets Even Worse: Stock Plummet Followed Up by Major Vehicle Recall
On Wednesday, Tesla released its fourth-quarter earnings, which came in below analysts’ expectations.
By 4:00 p.m. Thursday, unsurprisingly, stock in the electric vehicle manufacture had experienced a 24-hour drop of more than 12 percent. (It had recovered only a small portion of that drop by early Friday morning.)
But the hits just kept on coming.
In news that was unlikely to assist the stock’s recovery, the National Highway Traffic Safety Administration announced Friday that Tesla was recalling nearly 200,000 vehicles.
According to Reuters, the recall was driven by faulty software that could impact the ability of drivers to see what was behind their vehicles when backing up.
“The rearview malfunction, caused by software instability, might decrease the driver’s visibility and increase the risk of a crash,” Reuters said, citing the NHTSA.
Apparently, all 2023 Tesla S, Y and X models are affected by the recall — nearly 200,000 vehicles in all, according to the outlet.
The company released an update to the software to correct the issue, which the NHTSA said could have contributed to at least 81 warranty claims identified by the regulator by Monday.
Tesla, however, said that it was “not aware of any crashes, injuries or deaths that may be related to this condition,” according to the Des Moines Register, though it did admit to getting reports starting on Dec. 26 of some rearview camera feeds not working.
Regular readers of The Western Journal may recall that just over a month ago, Tesla recalled essentially every vehicle it had sold in the U.S. due to issues with its “Autopilot” system.
“NHTSA opened its August 2021 probe into Autopilot after identifying more than a dozen crashes in which Tesla vehicles had hit stationary emergency vehicles,” Reuters noted.
In addition to reporting disappointing fourth-quarter earnings this week, the company also predicted “sluggish” sales for 2024, ABC News noted.
Tesla was forced to cut prices last year in the increasingly competitive electric-vehicle market, so that even though the company sold more vehicles in 2023 than ever before — over 1.8 million — its revenue was significantly impacted.
The company tried to assure investors during a conference call Wednesday that a “next-generation vehicle” due out late next year would turn sales around.
Not everyone was buying that argument, according to ABC.
“Tesla is nothing more than a struggling car company,” Gordon Johnson, CEO and founder of data firm GLJ Research, told investors in a note cited by the outlet.
Dan Ives, a managing director of equity research at the investment firm Wedbush, added that the call was a “train wreck,” ABC reported. He added, however, that he remained optimistic about the company’s long-term prospects.
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