Important points
Tesla (TSLA) on Tuesday, as federal regulators announced they were investigating accidents related to the company’s automated vehicle summons feature, while Bank of America analysts announced a downgrade of Tesla (TSLA) stock. Stocks fell.
The National Highway Traffic Safety Administration (NHTSA) has launched an investigation into the Smart Summon and Actuarial Smart Summon features that allow Tesla drivers to remotely navigate their vehicles using a phone app. The agency said it has received complaints that Tesla cars were unable to detect obstacles or parked vehicles, resulting in crashes.
Specifically, NHTSA’s Office of Defect Investigations received 12 complaints related to Smart Summon and one complaint related to Actuarial Smart Summon, an upgraded version of the feature. The bureau also investigated “at least” three media reports about other Actuarial Smart Summon cases.
meanwhile. Bank of America Securities on Tuesday lowered Tesla’s rating to “neutral” from “buy,” but raised its price target to $490 from $400. That’s about a 25% premium after Tesla shares fell 4.1% on Tuesday to close at $394.36.
Analysts said that despite the increased price target, “execution risk is high and TSLA is trading at levels that broadly capture our base scenario.”
The bank’s analysts are eyeing multiple potential growth drivers this year, including the introduction of lower-cost Tesla models in the first half of the year, the launch of robotaxis in mid-year, and the enhancement of MegaPack’s commercial services. Energy storage batteries are produced at the Shanghai assembly plant.
