Tesla China Recalls 1.1 Million Vehicles to Reduce Collision Risk Following Price Raise

BEIJING, May 12 (TiPost)— China’s market regulator announced Tesla Inc to launch a massive recall, targeting both models made locally and those imported from the United States. 

Source: Visual China

Tesla reported its plan to recall a total of 1,104,622 units starting from May 29, according to a statement of the State Administration for Market Regulation (SAMR) on Friday. The recall involves some of imported Model S, Model X and Model 3 cars as well as China-made Model 3 and Model Y cars, which were produced from January, 12, 2019 to April 24, 2023. The scope suggests Tesla almost recalled all the cars it sold in China. The U.S. electric vehicle (EV) maker in earlier this year said it delivered 1.31 million last year, more than half of them made in China. Gigafactory Shanghai shipped more than 710,000 units in 2022, increasing 48% from a year ago, the China Passenger Car Association (CPCA) estimated in January.

The recent recall was made as SAMR initiated a defect investigation, which prompted Tesla to develop a plan to offer new capabilities to vehicles through its over-the-air (OTA) software updates, so as to reduce collision risks due to the driver’s hard stepping on the accelerator for a long time, according to the statement. The concerned vehicle could increase the risk of collision for it is lack of options for drivers to set the intensity of their regenerative braking, and doesn’t provide enough alert in case of hard acceleration for too much time, which makes drivers more likely to misstep on the gas pedal, the regulator noted.

Tesla China will add feature about the alert for hard acceleration through the recall, people at the company later that day confirmed to the national newspaper Shanghai Securities News. Pedal misapplication is a common cause of traffic accidents, and the latest OTA update aims to lower the probability of accidents caused by applying the wrong pedal, the insider said. The people expected Tesla would inform owners of concerned vehicles for recall arrangement in the near future, through text messages mail or other ways.

Morningstar analyst Seth Goldstein deemed Tesla China’s recall as a “fairly mild” one as it essentially is an OTA update, instead of those major ones where customers have to take their cars to get serviced to fix an equipment issue.

It’s unclear what effect of the recall for Tesla’s recent marketing strategy, which just turned a surprisingly shift in China. During the past Labor Day holiday in the start of the month, Tesla raised prices twice in just four days. The EV giant increased prices for Model Y and Model 3, its two top-selling models, in a range of markets on May 2, including a price increase of RMB2,000 in China and an increase of US$250 in U.S. Then it hiked prices by RMB19,000 for Mode S and Model X, the new models for Chinese customers that have to be imported from the U.S. and had started delivery in March. Tesla U.S. website showed its second round of price increase this month on Friday. Prices of all models but Model 3 have been increased by as much as US$1,000.

The recent price increases of Tesla are positive signals for operation condition of the overall auto market, CPCA commented earlier this week. The auto industry body said the increases suggested automakers’ focus on operating quality, which is useful for consumer’s further transition from their wait-and-see attitude and encourage them back to normal purchase pace.

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