Shares in auto giant Stellantis (STLA) crashed 4% today on fears that safety issues with its Ram trucks may have caused injuries and deaths.
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Transmission Concerns
The U.S. National Highway Traffic Safety Administration said it was opening a recall query covering about 1.2 million Stellantis Ram trucks over concerns related to the transmission.
The safety regulator said impacted vehicles displayed issues related to the brake transmission shift interlock, which may lead to them rolling away.
The NHTSA said it has received 14 complaints from vehicle owners and six death and injury reports through its Early Warning Reporting program regarding this potential safety defect.
The investigation focuses on the transmission system that normally prevents vehicles from shifting out of park unless the brake pedal is pressed.
Latest Setback
This is the latest setback to the company, whose brands include Chrysler, Dodge and Fiat. Earlier this month the NHTSA opened a recall query into about 299,000 vehicles from Stellantis after receiving complaints about faulty shifter cable bushings.
A bushing, usually made of rubber, connects the shifter cable to the transmission system, allowing the vehicle to change gears. If the bushing is damaged or missing, the vehicle could move in an unexpected and unhelpful direction.
Other recalls this year include 235,640 Ram ProMaster vans with faulty rearview camera systems, 33,777 Ram 1500 trucks with headlight failure issues, and 10,396 Ram 1500 pickup trucks with tire pressure monitor errors.
At a challenging time for the auto industry given tariff uncertainty and intense competition, this spate of recalls is an unwelcome hit to Stellantis’ brand reputation.
Is STLA a Good Stock to Buy Now?
On TipRanks, STLA has a Hold consensus based on 4 Buy, 11 Hold and 2 Sell ratings. Its highest price target is $15.31. STLA stock’s consensus price target is $11.37 implying a 10.28% upside.
