Tesla Launches Voluntary Recall of Select Model Y Units Over Steering Concerns

By Kevin Armstrong
Tesla is recalling a small amount of Model Y vehicles
Tesla is recalling a small amount of Model Y vehicles
Tesla

Following a diligent observation by a service technician, Tesla has proactively initiated a voluntary recall on a fraction of its Model Y vehicles. The issue pertains to a potentially improperly torqued steering wheel fastener, which could lead to the steering wheel disconnecting from the column. The recall was issued after an Office of Defects Investigation (ODI) was launched by the National Highway Traffic Safety Administration (NHTSA).

The Model Ys affected by the recall were produced between June 2023 and May 2023. According to Tesla’s estimation, only about 10% of the recalled vehicles, approximately 14 units, could potentially be affected by the fastener issue. No instances of complete steering wheel detachment have been reported as of yet, and this preemptive measure by Tesla further reaffirms the company's commitment to customer safety and product integrity.

The Scope and Impact of the Recall

Tesla's actions demonstrate a level of transparency and caution that underlines the company's commitment to customer safety. The identified issue came to light when a technician observed a loose feel in the steering wheel on May 4, 2023. A subsequent analysis of service and production records led to the decision to issue the recall.

Despite the small number of potentially affected vehicles, Tesla has taken it upon itself to rectify the issue. The problem is distinct from the one that resulted in the ODI investigation earlier this year, which concerned vehicles delivered without the fastener that attaches the steering wheel to the steering column. In this instance, the fastener is present but might not have been torqued to the correct specification.

Ensuring Safety and Quality: Tesla’s Resolution Plan

As part of the recall process, Tesla Service will thoroughly inspect the fastener securing the steering wheel to the column in the affected vehicles. If any fasteners are found improperly torqued, they will be replaced and torqued to the correct specification. This move will ensure that the steering control is not compromised, reducing the risk of any potential collisions.

Tesla's proactive and transparent approach also includes steps to avoid future occurrences. These measures include updating the production tool used to torque the fastener, both programmatically and physically, to prevent incorrect torque actions. Production associates have also been retrained to ensure the correct assembly process is adhered to, further underlining Tesla's commitment to quality and safety.

Owners of the Model Y vehicles involved in the recall will receive official notifications in compliance with 49 C.F.R. § 577.7. Tesla anticipates sending out these letters by July 28, 2023, ensuring customers are informed and assured that their safety is Tesla's top priority.

Tesla's Shareholder Event: Vote Results And Video Replay

By Karan Singh
Not a Tesla App

Yesterday on X, Elon Musk posted that the two key resolutions for the upcoming Shareholder Meeting were both passing by wide margins – and would subsequently go on to pass at today’s Shareholder Meeting.

Musk Compensation Package and Tesla’s Move to Texas

The two key resolutions, one on Elon Musk’s performance-based compensation package, and the other on Tesla’s re-incorporation to Texas, both passed in the preliminary stages. Each required a minimum number of ‘Yes’ votes to pass at the Shareholder Meeting.

The performance-based compensation package only required a simple majority – a certain number of Yes votes, with abstentions not counting as Nos. On the other hand, the move to Texas required a full majority, with abstentions counting as Nos.

Elon Musk declared his victory on X in these two key votes, and Tesla’s share prices moved favorably in post-market, and then again in pre-market trading. This is a positive indicator for Tesla and Elon Musk. On X, Elon recently agreed that given he has received a controlling stake in Tesla, he would work towards making Tesla the most valuable company on Earth.

Other Resolutions

The first five proposals are Tesla corporate proposals, while the remainder are shareholder proposals, and are covered in the table below. For more details, you can read Tesla’s Proxy Package. The proposals are ordered below in the order of presentation.

Resolution

Status

Elect 2 Directors for a 3 Year term (James Murdock, Kimball Musk)

PASS

Non-Binding Advisory-basis Executive Compensation

PASS

Move Tesla to Texas

PASS

Elon Musk’s Compensation Package

PASS

Appoint PricewaterhouseCoopers as Tesla’s accounting firm.

PASS

Reduce Director Terms to 1 Year

FAIL

Simple Majority Stockholder Voting

FAIL

Annual Report on Anti-Harassment and Discrimination

PASS

Freedom of Association and Collective Bargaining Policy

PASS

Report on EM Radiation and Wireless Technologies, and effects on humans.

PASS

Adopting targets and reports for sustainability metrics for executive compensation

PASS

Moratorium on sourcing minerals from deep-sea mining.

PASS

Shareholder Meeting Event

You can view Tesla’s shareholder meeting below:

Tesla Likely to Launch Robotaxi Service in Next 5 Years, May Account for 90% of Future Profit

By Karan Singh
ARK Invest

Tesla is on the verge of its Robotaxi announcement event on 8/8, and major investors like Ark Invest are examining and refreshing their bull case scenarios.

Robotaxi as a Focus

Ark Invest sees Robotaxi as a focus of Tesla’s ongoing business and sees Tesla’s autonomous ride-hailing revenue to net nearly $1 trillion in 2029. In comparison, they estimate Tesla’s vehicle sales to account for $0.4 trillion in revenue. With this bull case, Ark Invest also sees Tesla’s share price soaring to $3,100 by 2029. Ark Invest’s bear case sees the share price moving to $2,000 and robotaxi netting $0.63 billion in revenue.

Ark Invest gives Tesla a 58% chance of launching its robotaxi service in 2025, and a 38% chance in 2026. It’s clear that Tesla’s future lies in operating a fleet of autonomous vehicles and the question is just when it will happen. Given FSD’s massive improvements between FSD V11 and FSD V12, there is a possibility of Tesla meeting these estimates, although a lot depends on how fast improvements will continue to come. While FSD V12 is impressive, it’s still a long way from a true autonomous vehicle.

Rate of Improvement

Miles driven by Tesla FSD versus autonomous competitors
Miles driven by Tesla FSD versus autonomous competitors
ARK Invest

Ark’s case is focused on the fact that FSD’s rapid improvement will continue, and a lot of that may be determined with the next few releases, including FSD 12.4.1, v12.5, and v12.6. When comparing Tesla to autonomous vehicles, Tesla has a drastic lead in miles driven, in fact, it’s so large that you can barely even see Tesla’s competitors. Tesla is at 1.3 billion miles driven with FSD, while the closest competitors are just reaching 15 million autonomous miles driven. While there’s a drastic difference in capabilities between Tesla’s FSD and autonomous vehicles such as Google’s Waymo, Tesla has the ability to gather data 86 times quicker.

Training data is key to building autonomous vehicles, and Tesla is currently the king of vehicle-related data.

Services Company

We previously wrote about whether Tesla’s future will be as a car company or a services company – and major investors such as Ark Invest and Morgan Stanley see Tesla’s AI services as a major driver of business in the future, and the focus of future revenue and profits.

Robotaxi, as both a service and as a physical product, has the opportunity to shake up markets in a unique way, providing quick, clean, and safe transportation between local destinations in urban areas, which could quickly outcompete traditional services like taxis, and tech competitors like Uber or Lyft. The market for robotaxi is untapped and massive, but Tesla isn’t the only one chasing the goal.

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