U.S. car safety regulators have launched a preliminary investigation into the electronic door handles of the Tesla (TSLA) Model Y. The probe, opened by the National Highway Traffic Safety Administration (NHTSA), follows multiple complaints that children were trapped inside the vehicle because the doors could not be opened from the outside.
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Despite the news, TSLA stock was up more than 2% as investors remained upbeat following CEO Elon Musk’s nearly $1 billion stock purchase.
The probe was triggered by nine complaints and follows a Bloomberg report highlighting similar incidents. In four reported cases, parents had to break a window to get their child out.
Key Issue with the Handles
The NHTSA is reviewing over 174,000 Model Y vehicles from the 2021 model year. The agency aims to determine how the electronic door locks operate when the car’s power is low. According to the investigation, the incidents appear to happen when the door locks do not get enough voltage.
However, the NHTSA reported that none of the affected vehicle owners recalled seeing a low battery warning before the external door handles stopped working.
“Entrapment in a vehicle is particularly concerning in emergency situations, such as when children are entrapped in a hot vehicle,” the NHTSA said in a statement. The agency noted it would take further action if necessary and continue to monitor additional reports.
Though TSLA provides guidelines for restoring power to the door handles, the process is complex and requires an external 12-volt DC power source. The NHTSA stated that this procedure may not be easily accessible or widely known to owners.
Tesla Faces Rising Regulatory Scrutiny
NHTSA’s investigation is the latest in a series of active inquiries targeting Tesla. The automaker is also under investigation for potential defects in its Full Self-Driving system following multiple crashes.
Also, in a separate probe, the regulators are assessing the effectiveness of a software update designed to enhance the safety of its Autopilot driver-assistance system.
Apart from the legal front, the company’s sales have been impacted by fierce competition from Chinese rivals and a consumer backlash against Musk’s political activities. Moreover, in March, TSLA recalled over 46,000 Cybertrucks to address a faulty exterior panel that could detach while driving.
What Is the Prediction for Tesla Stock?
Turning to Wall Street, TSLA stock has a Hold consensus rating based on 13 Buys, 13 Holds, and eight Sells assigned in the last three months. At $310.73, the average Tesla price target implies a 25.85% downside risk. The stock has gained 72.3% over the past six months.
