Tesla Forced to recall 135K on Faulty Touchscreens
Tesla Forced to recall 135K on Faulty Touchscreens
The Feds asked nicely first, which doesn't work with Tesla. Add it to several big, expensive fixes Tesla has been ordered to make after fighting regulators as complaints pile up.
It's Groundhog Day, again. Meanwhile, Tesla is forced, again, to do another big recall.
The NHTSA has ordered Tesla to recall 135,000 cars because faulty touch screens (which control most everything) go blank while driving, putting drivers at risk.
Add it to the list of several big, expensive fixes Tesla has been ordered to make recently in the US and in China after fighting regulators as complaints pile up.
The Detroit Bureau writes:
Automaker had resisted calls to replace touchscreens that could unexpectedly black out.
With federal safety regulators breathing down its back, Tesla has agreed to recall nearly 135,000 battery-electric vehicles equipped with touchscreens that are prone to unexpectedly failure – which could make it difficult for motorists to operate the vehicles and potentially lead to a crash.
The problem has been widely reported by owners and Tesla has been making free repairs on an ad hoc basis, but that didn’t satisfy the National Highway Traffic Safety Administration, which felt that the screens should be replaced before they fail, avoiding the chance that drivers would be left at risk.
Tesla uses its laptop computer-sized displays to operate virtually all vehicle functions and such failures could make it difficult to see what gear a vehicle is operating in, as well as being able to use its backup camera. And because the driver could lose the ability to control the vehicle’s climate control system – including front and rear window defoggers, NHTSA warned the problem “may decrease the driver’s visibility in inclement weather.”
(Tesla told to recall 158,000 vehicles due to touchscreen failures.)
The recall covers two of Tesla’s original product lines, a total of 134,951 Model S sedans and Model X SUVs.
This is more bad news Tesla can do without. Worse, it’s not even surprising, as I discussed last week in Tesla: Oh No You Didn’t, a deep dive into fourth quarter results:
Profitability is going the wrong way.
That can happen when the prevailing strategy involves multiple rounds of price cuts and expensive incentives every quarter to ignite faltering sales versus still problematic and inconsistent manufacturing which produces cars with troubling quality and reliability issues which are expensive to repair (especially when they are recalled and recalled and recalled and…). This quarter Tesla admitted its average selling price (ASP) dropped 11%.
And in Tesla: The Sky's The Limit...Until on 1/25/21:
This reflects my ongoing concerns that revenue quality and profitability in core operations continue to erode every quarter from unfavorable mix and persistent same-store demand decline plus new rounds of substantial price cuts and expensive incentives (like up to a year of free Autopilot access offered in the fourth quarter) Tesla increasingly needs to boost sales on top of troublingly persistent problems with production, quality, and reliability which keep Tesla cars expensive to produce and repair.
This, as I long have warned, also further impairs demand as customers discover (and tell their friends) how inordinately expensive are Tesla cars to insure and keep running due to their poor build quality and reliability—and how abysmal is Tesla’s customer service.
In the fourth quarter, for example, Tesla ended its 7-day no-questions-asked return policy on all new vehicles and forced customers to accept news cars without inspection first to prevent delivery refusals—as one does to demonstrate complete confidence in its products.
This becomes a self-inflicted and seemingly perpetual margin squeeze, and why no matter how many billions of dollars of additional revenue Tesla claws in, it still must manufacture a few hundred million extra in boosts every quarter to report “profit.”
And in Barron’s Weighs in On “Frenzied Pops” In Tesla Vs Wary Skeptics Like...:
Elon Musk gets irritated with those of us who call out problems with Tesla’s dicey financials and prospects, telling the The Wall Street Journal that the focus seems to be weighted too much on “board meetings” and “spreadsheets” and not enough on whether the product is “as awesome as it could be.” To which he adds, “probably not.”
That’s certainly true for Tesla. Its cars still trail all of its peers in quality and reliability rankings by JD Powers and Consumer Reports. The thing is we do care that such nagging problems have plagued Tesla’s cars and their owners for years, topped off with its poor customer service to boot. About what one might expect from a company that eliminated its entire quality control department in January last year in a scramble to slash costs (see my report “Tesla's Plan B 2.0; Y Not” on 3/10/19).
Too cute by half for Musk to smugly suggest that other companies and market observers should pay more attention to companies making products as awesome as they could be and not worry so much about the numbers.
Worse, Tesla’s problems are the result of massive manufacturing and quality control failures which have been going on for years. So bad I wrote an entire report about it in July 2019: The Trouble With Tesla’s Arrested Development.
But no worries since Tesla isn’t a car company, right?
Sorry, but nope. See Things People Believe: Flat Earth, Faked Moon Landings, and Tesla $2100 on 8/23/20.