Tesla Stock Under Pressure as NHTSA Probes FSD Traffic Violations
Nearly 2.9 million vehicles are under investigation following reports of Full Self-Driving software running red lights and causing crashes.
Tesla Inc. (TSLA) is once again in the crosshairs of federal regulators, as the National Highway Traffic Safety Administration (NHTSA) opens a new investigation into its Full Self-Driving (FSD) technology. The probe covers approximately 2.88 million vehicles across all four of its models—the Model Y, Model X, Model S, and Model 3—following multiple reports of the automated driving system committing traffic violations.
The preliminary evaluation was launched after the agency received dozens of complaints alleging dangerous vehicle behavior. According to NHTSA's Office of Defects Investigation, these incidents include vehicles running red lights, failing to stop correctly, and even driving against the proper flow of traffic during lane changes. The agency is reviewing 58 reports detailing these safety issues, which have allegedly led to at least .
This inquiry is the latest in a series of federal probes that have intensified scrutiny on Tesla's autonomous driving ambitions. It follows a separate NHTSA investigation started in August 2025 into whether the company delayed reporting crashes involving its advanced driver-assistance systems. The continued regulatory pressure underscores the significant challenges and safety concerns accompanying the rollout of semi-autonomous vehicle technology. These investigations often in the sector and can lead to significant compliance costs.
For Tesla, the financial and reputational stakes are high. A formal recall could be mandated if NHTSA determines the FSD system poses an unreasonable risk to safety, potentially requiring costly software updates or limitations on the system's functionality. While Tesla's stock did not immediately react, previous announcements of federal probes have historically led to downturns in its share price. The outcome of this investigation could have lasting implications, not just for Tesla, but for the broader autonomous vehicle industry as it navigates the complex intersection of innovation and regulation. This latest probe is another reminder that the road to full autonomy is fraught with regulatory hurdles, as .