Tesla Inc. is on a collision course with the top U.S. auto-safety regulator over technology that’s been key to the company becoming far and away the world’s most valuable carmaker.
Last month, Tesla beamed an over-the-air software update to its vehicles aimed at improving how its driver-assistance system Autopilot handles crash scenes. Weeks earlier, the National Highway Traffic Safety Administration opened an investigation into whether Autopilot was defective after repeated collisions with police cars and fire trucks.
Tesla made the potentially fateful decision to deploy the update without initiating a recall. The move opened the company up to risks including fines, greater scrutiny of its over-the-air updates and damage to Autopilot’s standing with would-be car buyers, according to safety advocates including a former acting administrator of NHTSA.
“If you’re not going to be transparent about problems with your vehicles and what you’re doing to fix them, that could erode consumer confidence,” said David Friedman, vice president of advocacy for Consumer Reports, who led the agency during the Obama administration. “I hope NHTSA will fine them for failing to fix the problem and failing to report it.”
NHTSA’s probe of Autopilot and scrutiny of Tesla’s over-the-air update will be test cases for how regulators and makers of increasingly automated vehicles ensure their safety. Also at stake are perceptions of Tesla’s self-driving technology, which CEO Elon Musk has pointed to as the reason investors view the company being worth more than much larger car manufacturers.