NHTSA prompts Tesla to recall 363,000 models over Full Self-Driving crash risk

WASHINGTON — Tesla Inc. is recalling nearly 363,000 U.S. vehicles equipped with or pending installation of its Full Self-Driving beta software because of an increased risk of crash.

The recall covers certain 2016-23 Model S and Model X electric vehicles as well as certain 2017-23 Model 3 and 2020-23 Model Y vehicles.

NHTSA on Thursday said the automaker's self-described Full Self-Driving software "may allow the vehicle to act unsafe around intersections, such as traveling straight through an intersection while in a turn-only lane, entering a stop sign-controlled intersection without coming to a complete stop, or proceeding into an intersection during a steady yellow traffic signal without due caution."

The agency also said the system "may respond insufficiently to changes in posted speed limits or not adequately account for the driver's adjustment of the vehicle's speed to exceed posted speed limits."

To fix the issue, Tesla will release an over-the-air software update. Vehicle owner notification letters are expected to be mailed by April 15. Tesla said it expects to deploy the software update “in the coming weeks,” and that the update will “improve how FSD Beta negotiates certain driving maneuvers.”

NHTSA said it advised Tesla in January that it had identified “potential concerns” related to Full Self-Driving beta’s operation in specific roadway environments, according to a recall report submitted Wednesday.

The agency said it asked Tesla to address the concerns by issuing a recall notice. Tesla, while not agreeing with the agency’s analysis, decided to issue a voluntary recall “out of an abundance of caution,” according to the report.

As of Tuesday, Tesla told U.S. auto safety regulators it has identified 18 warranty claims that were received between May 8, 2019, and Sept. 12, 2022, that may be related to the recall, the report stated.

Tesla said it was not aware of any injuries or deaths related to the issue.

The recall comes as NHTSA continues its investigation into Tesla's Autopilot driver-assist system after a series of crashes in the U.S. that resulted in more than a dozen injuries and one death.

In June, NHTSA upgraded its investigation to an engineering analysis, covering an estimated 830,000 Tesla vehicles from the 2014-22 model years.

The agency also opened a separate investigation involving Tesla vehicles after receiving hundreds of complaints alleging unexpected activation of the automatic emergency braking system, characterized by some Tesla owners as "phantom braking."

In a statement Thursday, NHTSA said analysis and testing performed as part of the investigation revealed that in certain situations, Tesla’s “Autosteer on City Streets” feature in the FSD beta “led to an unreasonable risk to motor vehicle safety based on insufficient adherence to traffic safety laws.”

“As required by law and after discussions with NHTSA, Tesla launched a recall to repair those defects,” the agency said.

NHTSA said it will continue to monitor the recall remedies for effectiveness and that its investigation into Tesla’s Autopilot and associated vehicle systems such as FSD “remains open and active.”

Tesla’s FSD beta — a complement to the standard Autopilot system — is sold as a $15,000 option or a $199 monthly subscription.

Tesla describes the proprietary FSD software as "an advanced driver-assistance system that assists your car with steering, accelerating and braking for other vehicles and pedestrians within its lane." Unlike other automaker systems, FSD is designed to be used on city streets.

Tesla warns on its website that, despite its confusing name, Full Self-Driving is only an assistance feature and that drivers are responsible for the operation of their vehicles at all times.

Sam Abuelsamid, principal analyst for e-mobility at Guidehouse Insights, said in an interview last month that Tesla's standard Autopilot software and optional Full Self-Driving feature have gotten a pass from regulators despite a spate of vehicle crashes and statements by the company that some have called misleading.

“What should happen is that regulators somewhere need to say: 'Look, you're selling something that doesn't work as marketed, and you need to give customers back their money,' " Abuelsamid told Automotive News.

"These cars are never, ever going to be able to operate as robotaxis," he added.

On Twitter Thursday, Tesla CEO Elon Musk said use of the word “recall” for an over-the-air software update is “anachronistic and just flat wrong!”

To be sure, manufacturers are required to issue a recall for any repair, including a software update, that remedies an unreasonable risk to safety, according to NHTSA. They also are required to submit any communications to owners, dealers and others about any software updates that address a defect, whether or not it is safety related.

Laurence Iliff contributed to this report.