Tesla (TSLA) has recalled around 9,100 Model X SUVs in the U.S. due to a potential issue with a roof trim that could detach and create a road hazard, increasing the risk of a crash. Notably, the recall affects 2016 Model X vehicles, marking the second recall for this issue since 2020.
Details of TSLA’s Vehicle Recall
Specifically, the National Highway Traffic Safety Administration (NHTSA) noted that the front and center roof trim pieces may have been adhered without primer, making them more likely to separate. In response, Tesla announced that the recall will cover Model X SUVs for the 2016 model year.
Moreover, the EV giant stated that its supplier implemented a process change in July 2016 to prevent this issue in later models. Additionally, the company noted that it will inspect the adhesion of the roof trim on affected vehicles and reattach the trim if needed, free of charge.
Tesla also reported that it is aware of around 170 cases related to this issue but emphasized that there have been no crashes or injuries associated with it. Importantly, this is the first time Tesla is physically recalling its vehicles, as it typically resolves issues through over-the-air software updates.
Tesla’s Rising Vehicle Recalls
According to a Reuters report citing data from Bizzycar, Tesla has recalled 2.6 million cars in the first half of the year, just behind Ford Motor (F), which has recalled about 3.6 million vehicles in the U.S. during the same period.
Given this trend, the company’s rising vehicle recalls could further impact its sales in the U.S. Tesla’s U.S. sales have already slowed significantly due to rising competition, and its aging EV lineup has led many customers to switch to newer models.
In fact, according to market research firm Cox Automotive, Tesla’s U.S. sales declined by 6.3% year-over-year in the second quarter, totaling 164,000 cars.
Is Tesla Buy or Sell?
Analysts remain sidelined about TSLA stock, with a Hold consensus rating based on 10 Buys, 14 Holds, and seven Sells. Year-to-date, TSLA has declined by more than 10%, and the average TSLA price target of $211.46 implies a downside potential of 4.3% from current levels.
