US regulators take aim at Tesla over Model 3 safety claims

Tesla’s claims about the safety of its Model 3 electric vehicle prompted U.S. regulators to send a cease-and-desist letter and escalate the matter by asking the Federal Trade Commission to investigate, according to documents released by the nonprofit legal transparency website PlainSite.

The documents show correspondence between the lawyers at National Highway Traffic Safety Administration and Tesla that began after the automaker’s October 7 blog post that said the Model 3 had achieved the lowest probability of injury of any vehicle the agency ever tested. PlainSite received the 79 pages of communications since January 2018 between NHTSA and Tesla through a Freedom of Information Act request. There were 450 pages of communication that were withheld due to Tesla’s request for confidentiality on the basis of “trade secrets.”

NHTSA took issue with the blog post, arguing that Tesla’s claims were inconsistent with its advertising guidelines regarding crash ratings. The matter might have ended with that demand. But NHTSA took the issue further and informed Tesla it would ask the Federal Trade Commission to weigh in.

“This is not the first time that Tesla has disregarded the guidelines in a matter that may lead to consumer confusion and give Tesla an unfair market advantage,” the letter dated October 17 reads. “We have therefore also referred this matter to the Federal Trade Commission’s Bureau of Consumer Protection to investigate whether these statements constitute unfair or deceptive acts or practices.”

Tesla did not respond to a request for comment.

The automaker’s lawyers did, however, push back against NHTSA’s request, according to the correspondence released by PlainSite. Tesla lawyers argue in one letter that the company’s statements were neither “untrue nor misleading.”

“To the contrary, Tesla has provided consumers with fair and objective information to compare the relative safety of vehicles having 5-star overall ratings,” the letter from Tesla’s deputy general counsel.

The documents posted by PlainSite also showed NHTSA requested sales data on all Tesla vehicles produced since July 2016 with or without Autopilot, the automaker’s advanced driver assistance system. The agency also issued subpoenas to Tesla ordering it to produce information on several crashes, including a January 25, 2019 crash in San Ramon, Calif. The subpoenas requested information about the vehicle, its owner, history and videos and images related to the crash and were to be sent to NHTSA’s Office of Defects Investigations.

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