Tesla's stock suffers sixth straight slide as Cybertruck recall is announced

By Emily Bary

The electric-vehicle maker is recalling 3,878 vehicles for an accelerator issue, though it isn't aware of any crashes or injuries stemming from the problem

Tesla Inc. must recall nearly 4,000 Cybertruck vehicles due to potential problems with their accelerator pedals.

The National Highway Traffic Safety Administration disclosed the recall, affecting 3,878 vehicles, noting that the "accelerator pedal pad may dislodge and become trapped by the interior trim."

That could cause an unintentional acceleration in the vehicle, increasing crash risk, said the Thursday letter from the NHTSA, which acknowledged Tesla's (TSLA) notification of this safety recall.

Read: Tesla earnings day is around the corner. So far, robotaxis are 'just a buzzword.'

Tesla plans to conduct free replacement or repairs of the accelerator pedal assembly, and it will notify owners by letter in June. The company isn't aware of any crashes, injuries or deaths related to this issue.

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While some Tesla recalls can be addressed with over-the-air software updates, this one is different as the company will be doing physical repairs.

Tesla shares dropped 1.9% in Friday trading to log their sixth session in a row of declines. The stock's last six-session losing streak wrapped Jan. 5.

Shares of Tesla are down 41% so far this year as the company has been besieged by challenges including demand weakness and growing competition. Wall Street is debating the company's choices fiercely, especially as Tesla plans a big robotaxi push in August during a time when some think it should instead be focusing its efforts on a low-cost Model 2.

Tesla Cybertruck recall: How owners can fix the potential safety problem

The stock is currently the second-worst performer in the S&P 500 SPX on the year, behind only that of Globe Life Inc. (GL), an insurer that was the subject of a short-seller report earlier this month.

Tesla will look to change the narrative and reengage investors when it reports earnings Tuesday afternoon.

See also: Nvidia's stock plunge leads Magnificent Seven to record weekly market-cap loss

-Emily Bary

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04-19-24 1753ET

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