Tesla (TSLA) is facing yet another regulatory probe in the U.S., this time relating to 2.6 million vehicles and issues around the EV maker’s Actually Smart Summon feature, which allows the user to remotely move the vehicle to another location using an app on their phone.
Stay Ahead of the Market:
- Discover outperforming stocks and invest smarter with Top Smart Score Stocks
- Filter, analyze, and streamline your search for investment opportunities using Tipranks' Stock Screener
The National Highway Traffic Safety Administration (NHTSA) opened an investigation Monday, January 6th, after it received a complaint alleging that an Actually Smart Summon session resulted in a crash. It has looked at least three media reports of apparently similar crashes. All four incidents involved the Tesla vehicles operating in Actually Smart Summon mode and failing to detect posts or parked vehicles, resulting in a crash, the NHTSA said.
It went on to say that it was aware of “multiple crash allegations, involving both Smart Summon and Actually Smart Summon, where the user had too little reaction time to avoid a crash, either with the available line of sight or releasing the phone app button, which stops the vehicle’s movement.”
TSLA and NHTSA Clash Again
This is just the latest in a series of potential problems regarding Tesla’s proprietary technology. In October the NHTSA opened an investigation for an estimated 2.4 million Tesla vehicles over the safety of the company’s Full Self-Driving (FSD) technology. The administration had identified four collisions that occurred in low-visibility conditions while the FSD feature was active. In one incident a Tesla vehicle fatally hit a pedestrian.
Will Another Probe Affect TSLA Stock?
Every time TSLA is hit with this kind of thing, it always seems to bounce back. So far, the reaction to the investigation has been muted. New Street Research analyst Pierre Ferragu upgraded TSLA shares to Buy from Hold and took his target price to $460 from $240. According to Barron’s he said: “Growth in autos should re-accelerate with the launch of lower-cost models, and gross margins stabilizing, as Tesla reduces costs as fast as prices.” Meanwhile BofA has just downgraded TSLA from Buy to Neutral.
What Is the Prediction for TSLA Stock
The analyst consensus is Hold, based on 34 Wall Street analysts offering 12-month price targets for Tesla in the last three months. The average TSLA price target is $317.90, which represents a 22.7% downside potential from current levels.
