Shares of Tesla Inc. slid nearly 3% in premarket trading, with losses intensifying late in the session as news of another safety-related federal investigation spread.
This time, nearly 300,000 Tesla Model 3s and Model Ys, the automaker’s most popular vehicles, are under a fresh National Highway Traffic Safety Administration investigation into their steering after a dozen complaints alleging loss of steering control.
The stock has more than doubled this year, compared with gains of around 19% for the S&P 500 index.
U.S. auto safety regulators said Tuesday they have opened an investigation into 280,000 new Tesla Model 3 and Model Y vehicles over reports of loss of steering control and power steering.
The National Highway Traffic Safety Administration (NHTSA) opened a preliminary evaluation after it received 12 complaints from owners of 2023 Tesla Model 3 and Model Y vehicles.
One Model 3 driver reported in May the "car steering felt stuck and slid off the road which resulted in crashing into a tree."
A driver in Alpharetta, Georgia in June reported that a two-week-old Tesla Model Y was coming out of a shopping center when "suddenly steering wheel did not steer. It was hard and saw the alert. Went to very close to opposite side of traffic and some how made it to across the road inside the shopping center."
Tesla did not immediately respond to a request for comment.
This is the first step of a formal investigation to determine if the issue poses an unreasonable safety risk. NHTSA would need to upgrade the probe to an engineering analysis before it could demand a recall.
Another recent complaint said a Tesla Model Y that was less than 30 days old in April was turned on and the "wheel jerked hard right and made a thud" and the screen warned that “Steering Assist Reduced” and displayed an error code.
The driver said power steering was disabled and told the NHTSA it felt unsafe to steer and added "Tesla has moved my service visit from May 2 to May 25 due to a backlog of parts. They confirmed this is a recently known issue and noted the steering rack might be replaced entirely."
A driver in Honolulu said a week after purchasing a Tesla the steering wheel began locking up randomly and said it " occurred six times on different dates before we were able to get it to the Tesla service department." The driver said it "currently remains at Tesla for the next 3 weeks while we await a new steering rack/motor."