Tesla has announced a recall of nearly 700,000 vehicles in the US due to a tire pressure monitoring system (TPMS) issue. This recall affects certain Model 3, Model Y, and Cybertruck vehicles and is a result of a malfunction that could potentially increase the risk of accidents.
What Happened
The recall was announced after it was found that the TPMS warning light may fail to stay illuminated between drive cycles, leaving drivers unaware of low tire pressure. This could lead to vehicles being operated with improperly inflated tires, heightening the risk of accidents. As a result, Tesla’s stock price dropped 5.04% in pre-market trading.
The Recall
The recall affects 694,304 vehicles and will be addressed through an over-the-air software update, minimizing disruption for owners. Tesla has a history of resolving issues via software updates, and this recall is no exception.
Impact on Stock Price
The recall has had a significant impact on Tesla’s stock price, with a consensus price target of $280.41 based on the ratings of 33 analysts. The average price target has been set at $446.67, with an implied 7.26% upside for Tesla.
Ongoing Challenges
The latest recall highlights ongoing challenges for Tesla in maintaining vehicle safety standards. The company has been proactive in addressing issues, but the frequency of recalls remains a concern. In the September quarter alone, Tesla recalled 1,858,774 vehicles, the most in the US.
Conclusion
The recall of nearly 700,000 vehicles is a significant concern for Tesla and its investors. While the company has been proactive in addressing issues, the frequency of recalls remains a challenge. Tesla’s ability to resolve issues via software updates has minimized disruption for owners, but the impact on the company’s stock price is still significant.
Key Statistics
- 694,304 vehicles affected by the recall
- 5.04% drop in Tesla’s stock price in pre-market trading
- $280.41 consensus price target based on 33 analysts
- $446.67 average price target with an implied 7.26% upside for Tesla
- 1,858,774 vehicles recalled by Tesla in the September quarter