Tesla recalls 362,000 vehicles over crash risk caused by software glitch

The automotive giant is recalling hundreds of thousands of vehicles after a serious safety risk caused by a software glitch was discovered.

Tesla is recalling hundreds of thousands of US vehicles after a serious safety risk caused by a software glitch was discovered.

The issue relates to the Full Self-Driving (FSD) Beta software, which must now be updated in 362,758 affected cars after authorities revealed the system could cause crashes, and did not properly follow traffic safety laws.

The recall relates to certain 2016-2023 Model S, Model X, 2017-2023 Model 3, and 2020-2023 Model Y vehicles.

The Tesla software issue increases the risk of crashes. Picture: Patrick T. Fallon/AFP

A filing lodged on Thursday US time also reveals the FSD system “may allow the vehicle to act unsafe around intersections”.

The National Highway Traffic Safety Administration (NHTSA) said in a statement the FSD software allowed cars to “exceed speed limits or travel through intersections in an unlawful or unpredictable manner increases the risk of a crash”, and that the software error “could increase the risk of a collision if the driver does not intervene”.

“NHTSA will continue to monitor the recall remedies for effectiveness,” the agency said. “This recall seeks to address a specific set of concerns identified by the agency.”

An over-the-air software update will be carried out by mid-April and will be free of charge for impacted motorists.

In his only response to the situation so far, Tesla’s billionaire founder Elon Musk took to Twitter to gripe about the use of the term “recall”, posting that “for an over-the-air software update is anachronistic and just flat wrong!”

It’s another setback for eccentric billionaire Elon Musk. Picture: Britta Pedersen/Pool/AFP

The electric vehicle giant has confirmed that there have been no known injuries or deaths associated with the issue so far, and that it had received 18 warranty claims.

The news had an immediate impact on Tesla’s share price, which fell by 1.6 per cent after the recall was announced.

However, it comes after Tesla shares skyrocketed earlier this month, capping off stunning six-week rally which saw the carmaker more than double in value since early January’s eye-watering plunge.

“Tesla shares are experiencing an unprecedented surge in demand, and to a lesser extent, so are artificial intelligence-related stocks like Nvidia and C3.ai, as well as the rest of FAANG group,” Vanda Research’s Marco Iachini said in a note on February 9.

“If flows into cash equities sustain the current pace, we believe there is scope for the more speculative retail traders to pick up the slack in the options market too — where activity has been muted over the last year.”

FSD is the very feature that Musk himself has long spruiked, claiming it will eventually deliver completely self-driving capabilities.

But it has proved to be controversial even before the current error was uncovered, with Tesla revealing just last month that the US Department of Justice had requested access to documents related to the FSD and Autopilot advanced driver-assistance system.

The recall is particularly bad timing for the company, which is holding an investor day on March 1, when CEO Elon Musk is tipped to push Tesla’s artificial intelligence capability and reveal plans to expand its vehicle line-up.