Tesla: En Route To Absolution

Telsa received some very good news last week when the National Highway Traffic Safety Administration (NHTSA) concluded that driver error, not a failure in the company’s Autopilot feature, killed driver Joshua Brown. If their ruling had gone the other way, NHTSA might have spelled doom for Tesla. After all, CEO Elon Musk’s crown jewel is as beloved as it is inadequately resourced to survive a class action lawsuit or massive recall. A negative finding would have left the company vulnerable, potentially fatally so.

But that didn’t happen, and Tesla likely is out of the woods. Since Mr. Brown’s fatal accident, Tesla has released a new safety enhancement that will de-activate Autopilot if a driver repeatedly ignores cues to engage. NHTSA’s investigation also shows that the accident rate for cars with Autosteer dropped by 40%, compared to Tesla vehicles that lacked the feature. Musk has insisted that the Autopilot package would improve overall safety, and so far, the data backs him up.

Some risk for Tesla and its shareowners remains. NHTSA pointed out that its investigation explored Autopilot’s functionality. If consumers feel misled by the technology’s name or the way Tesla advertises it, the Federal Trade Commission may pursue its own investigation. Though Joshua Brown apparently loved his Tesla, don’t be surprised to see his family sue Tesla on the grounds that the company didn’t sufficiently warn drivers about Autopilot’s limitations. Driver photos and videos all over the internet support this argument. Running an image search for “tesla autopilot” produces lots of damaging evidence that Tesla’s customers either don’t get it or do understand and are taking a potentially deadly risk when they take their hands off the wheel.

In other words, Tesla may yet have to answer for too many drivers who do this:

I suspect all these “hands-free” drivers believe that Tesla’s Autopilot feature is more robust than it really is, and that its name has a lot to do with that.

Meanwhile, Tesla faces increased legal scrutiny in other markets.

All that aside, Tesla can point to NHTSA’s conclusion as proof that its technology behaved as designed, and that may blunt any other legal attacks for the foreseeable future. Tesla shareowners and fans are exhaling a big sigh of relief as a result.