Tesla Secretly Removed Steering Components To Meet Targets

Feb. 09, 2022 1:43 PM ET by Jay Traugott Electric Vehicles / 12 Comments

And didn't bother telling the customers who bought the cars.

Tesla has succeeded in ways no one could have imagined just a decade or so ago. It's now the world's most valuable automaker by a huge margin and it's showing no signs of slowing down despite some mishaps here and there. The latest SEC investigation of CEO Elon Musk isn't likely to have a huge effect. However, CNBC reports that Tesla allegedly removed one of the two electronic control units used in the steering racks of Chinese-built examples of the Model 3 and Model Y in order to reach end-of-year production targets in the final months of 2021. Again, blame the ongoing semiconductor chip shortage.

The information comes from two employees and internal correspondence viewed by the source. These vehicles are being sold in China, Australia, the UK, Germany, and other parts of Europe. At this stage, US vehicles appear to be unaffected.

2017-2022 Tesla Model 3 Front View Driving

2017-2022 Tesla Model 3 Side View Driving

Tesla has not publicly revealed this information and, because it lacks a PR department, it's difficult to get any official clarification on the matter. But the big question is how does this chip omission affect the cars? For starters - and this is huge - Tesla will be unable to do an over-the-air software update for driverless functionality. In other words, future versions of Full Self-Driving (FSD) may not be possible unless the cars are somehow retrofitted with the necessary chip.

The omission also directly undermines Musk's statement during a recent earnings call: "My personal guess is that we'll achieve Full Self-Driving this year at a safety level significantly greater than a person. So the cars in the fleet essentially becoming self-driving via a software update, I think, might end up being the biggest increase in asset value of any asset class in history. We shall see."

The good news is that overall safety is not affected because the removed chip is used as a backup unit. Also important to understand is that Teslas do not use a steer-by-wire system, meaning there's a physical connection between the steering wheel and the four wheels via electronic motors. These motors change the wheels' direction and provide drivers with feedback. Controlling the cars manually is still possible.

How this could get controversial is that once Tesla decided to exclude the secondary control unit from the steering racks, an internal discussion was held on whether or not to notify customers. In the end, the decision was made not to notify. Level 2 self-driving, such as FSD and Autopilot, doesn't require the dual-control system but future Level 3 versions will, but that's a problem for later.