esla (TSLA.US) announced a recall of 362,758 cars, saying the 'experimental' AI powered Full Self-Driving Beta autonomous software could cause collisions. The stock is losing before the market opens and it's german-traded shares (TSLA.DE) are falling down 7%:
- Notice of the car recall was posted yesterday on the National Highway Traffic Safety Administration (NHTSA) website. Tesla will deliver a software update to the cars to fix the problems, and Elon Musk reassured investors on Twitter;
- The FSD Beta system according to the statement may expose accidents especially near intersections and may not respond appropriately to speed limits. The FSD Beta test option currently costs $15,000 upfront or $199 per month in the US and comes with additional safety regulations;
- Tesla's autonomous program can best be summarized as an experimental system, made up of as yet untested new features. NHTSA and Tesla's communications indicate that the system is something much simpler than Musk has presented it. It is now "a driver support function that can provide steering, acceleration and braking support within certain limitations." So there is still a long way to go before full autonomy as well as the fulfillment of Elon Musk's vision in which Tesla cars 'drive themselves'.
Looking at the chart on the daily interval, the opening indicates a possible drop below the 23.6 Fibonacci retracement of the upward wave started at the beginning of the year, near $190 per share. The bulls failed to cross the 200-session average (red line), which may foreshadow return of the bears.
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Source: xStation5
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