NHTSA closes probe into 376,000 Tesla EVs after recall

The closure of a federal probe into power steering failures removes one regulatory overhang for Tesla as the company faces other active safety investigations.

The National Highway Traffic Safety Administration on Saturday closed its investigation into power steering loss affecting 376,000 Tesla Inc. electric vehicles, concluding that a company recall conducted in 2025 adequately addressed the defect.

"The recall remedy — a software update and, where necessary, steering component replacement — sufficiently mitigates the safety risk identified across the affected Model 3 and Model Y vehicles," the agency said in its closing notice.

The probe, opened in 2024, covered approximately 376,000 Tesla vehicles in the U.S. after the agency received more than 2,000 complaints of power steering failure. Tesla's recall deployed an over-the-air software update to adjust steering torque calibration and replaced physical steering components on vehicles where the software fix was insufficient.

The closure removes a potential liability and recall-expansion risk for Tesla, which has faced heightened regulatory scrutiny across multiple safety investigations. The decision also indicates that NHTSA considers over-the-air software updates a valid remedy for hardware-related safety defects — a precedent that could influence how future recalls are structured across the auto industry.

The development comes as NHTSA separately investigates a fatal crash involving a Tesla vehicle that struck a home in Texas, highlighting the company's continued regulatory exposure. Tesla shares have gained roughly 30% year-to-date through Friday's close, partly reflecting investor optimism that the company's regulatory and legal risks are narrowing.

The power steering probe was one of several active NHTSA investigations into Tesla vehicles, including inquiries into Autopilot-related collisions and steering control issues. With this closure, Tesla has resolved one of its longest-standing open investigations.

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