Tesla deploys fix to 1.2 million China EVs on safety concern

SHANGHAI: Tesla Inc. will release a software update to about 1.2 million cars in China - around half the fleet it’s sold in the country - to fix issues with the vehicles’ power steering and rear-view cameras that may pose safety risks.

The steering issue stems from a software problem that can cause the electronic power steering system to fail, the State Administration for Market Regulation said in a statement on Friday.

A potential malfunction of the cars’ rear-view cameras could meanwhile impair drivers’ fields of vision when reversing, increasing the risk of collisions.

Tesla will deploy an over-the-air software fix to 871,087 domestically produced Model 3 and Model Y vehicles to address the power steering failure.

Another 335,716 cars - a mix of imported Model S and Model X electric vehicles and domestically produced Model 3 and Model Ys - will get an update for the camera malfunction.

Owners of vehicles who can’t receive the software update remotely will be contacted for replacements free of charge.

Tesla filed a similar recall notice in the US earlier this month that involved around 240,000 cars.

Elon Musk’s EV maker had sold about 2.3 million cars in China as of the end of 2024, according to the China Automotive Technology and Research Center.

The company is facing an unprecedented surge in competition from Chinese players like BYD Co. in the world’s biggest automotive market.

Local carmakers are rapidly innovating, offering compelling alternatives at various price points.

Tesla recorded its first annual decline in worldwide vehicle deliveries in over a decade last year and only narrowly retained its lead over BYD as the top seller of fully electric cars in 2024.

It also witnessed the first-ever drop in annual shipments from its Shanghai plant since the facility started mass production in 2020.

Its market share is also shrinking in China, with Teslas accounting for around 10.6% of total battery EV retail sales last year, data from CATRC and compiled by Bloomberg Intelligence show. In 2020, Tesla commanded a share of that market closer to 16%.

Separately on Friday, Xiaomi Corp. recalled 30,931 SU7 electric sedans that were produced between February and November last year because of a software issue that posed a potential safety risk around the cars’ intelligent parking feature, the State Administration for Market Regulation said in another statement.