TLDR
- NHTSA expanded its investigation into Tesla’s electronic door handles after receiving 16 new reports of people trapped in vehicles, with some incidents requiring first responders to break windows to rescue children from hot cars.
- Tesla must provide extensive records by December 10 or face fines up to $27,874 per day, with a maximum penalty of $139 million for non-compliance.
- Tesla stock rose over 3% to $470.38 on Monday despite European sales plummeting 89% in Sweden, 86% in Denmark, and 48% in the Netherlands during October.
- China is preparing new safety standards for electronic door handles requiring clearer emergency release mechanisms, with public comments open until November 22.
- Tesla shareholders will vote November 6 on Elon Musk’s $1 trillion compensation package, with proxy firms recommending against it while company chair warns Musk might leave if it fails.
Tesla stock climbed more than 3% to $470.38 in early trading Monday. The gains put shares within 4% of the December 2024 record high of $488.54.
The rally happened despite troubling news on multiple fronts. European sales collapsed in October across key markets. Federal regulators expanded their safety investigation into the company’s door handles.
Deutsche Bank raised its price target by $30 to $470. The upgrade cited higher estimates for Tesla’s robotaxi business under a “multi-modal SOTP framework.”
Federal Safety Probe Widens
The National Highway Traffic Safety Administration ordered Tesla to hand over extensive records. The agency is investigating possible safety defects with the company’s flush-mounted, electronic door handles.
NHTSA’s Office of Defects Investigations received 16 new reports as of October 27. The complaints involved Model Y vehicles from 2021 where exterior door handles stopped working due to low battery voltage.
The agency initiated the probe in September after a Bloomberg report. That story detailed incidents where people were injured or died after becoming trapped in Tesla vehicles following collisions or battery failures.
Some cases involved children trapped inside hot vehicles. First responders had to break windows to rescue them when the electronic doors wouldn’t open.
NHTSA said owners reported being unable to enter or exit their cars. The problems stemmed from battery power loss and other issues affecting normal door handle operation.
The investigation covers all 2021 Model Y vehicles sold or leased in the United States. It also includes “peer vehicles” like Model 3 and Model Y from 2017 to 2022.
Tesla has until December 10 to provide the records. The company can request an extension but risks fines of $27,874 per violation per day. The maximum penalty reaches $139 million.
European Sales Drop Hard
Tesla’s October sales figures from Europe painted a grim picture. New car registrations fell 89% in Sweden, 86% in Denmark, 50% in Norway, and 48% in the Netherlands.
Spain saw a 31% drop even as overall electric and plug-in hybrid sales jumped 119%. France provided one of the few bright spots with a small gain for the second straight month.
Through September, Tesla’s European sales were down 28.5% compared to the same period in 2024. Analysts point to an aging lineup and limited model range.
Chinese competitors are eating into Tesla’s market share. In Denmark, BYD, Xpeng, and Geely’s Zeekr all outsold Tesla.
Spain’s numbers were even worse. SAIC’s MG brand sold 3,725 units in October compared to Tesla’s 393. BYD moved 2,806 vehicles while Chery’s brands delivered over 2,400 combined.
Sweden’s 133 Tesla sales in October trailed even Porsche’s 172 units. Tesla’s year-to-date Swedish sales through October dropped 67% from the prior year.
Political blowback hasn’t helped. Elon Musk’s public support for Donald Trump and European far-right parties has turned off some Western European buyers.
Tesla remains Norway’s top-selling automaker where nearly all new cars are electric. But local competitors are closing the gap fast.
Musk’s Pay Package Vote Looms
Shareholders meet November 6 to vote on Musk’s proposed $1 trillion compensation package. The plan ties pay to financial and operational milestones over the next decade.
Tesla chair Robyn Denholm warned Musk could leave if the vote fails. Proxy advisory firms ISS and Glass Lewis urged shareholders to reject the package over governance concerns.
Musk called them “corporate terrorists” on Tesla’s recent earnings call. Analysts expect the proposal to pass despite the criticism.
China’s Ministry of Industry and Information Technology released draft safety standards for door handles. The proposal requires clearer, more accessible emergency interior door release mechanisms. Public comments close November 22.
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