Recently, electric vehicle giant Tesla (TSLA) faced a lot of concern over the design of its door handles. Apparently, in some situations, they can be downright dangerous. That is not something most would expect out of something as innocuous as a door handle, but that is where we are today. Now, door safety is a “key priority,” and Tesla is facing mounting concern. Shareholders were similarly concerned, as shares slipped nearly 1.5% in Thursday afternoon’s trading.
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RDW, a Dutch authority that handles inspection and approval for Tesla vehicles about to enter the European market, is set to shift some of its rules to cover Tesla door handles. Under the new rules, reports note, Tesla vehicles will be specifically checked to ensure that occupants can leave a vehicle after a crash, and that first responders can reach them.
This is a particularly salient point right now, as several Tesla drivers found themselves trapped in their vehicles after the door handles lost power following a collision. This was particularly poignant in some cases where the vehicle caught fire which cut power, trapping drivers in a burning Tesla. An RDW representative noted to Bloomberg, “Doors must always be operable — from the inside by occupants and from the outside by emergency responders — even in the event of a power failure. Where current regulations fall short due to the introduction of new door concepts, this issue is being addressed within the respective committees.”
But Does Anyone Even Want Them?
One major issue facing Tesla that is not related to door handles is one of sheer demand. Apparently, there is a growing concern that, since government tax credits are no longer in the picture, demand for Tesla vehicles is likely to fall off altogether.
Granted, Tesla is not just cars, but also batteries, artificial intelligence, and potentially some of Elon Musk‘s own private industries, like xAI, the X platform, and Starlink. Tesla also has an excellent position in the electric vehicle market, holding about 43% of the United States’ market. And with cheaper Model 3 and Model Y vehicles coming soon, the end result is that Tesla may be in the best position to endure an overall market downturn.
Is Tesla a Buy, Hold or Sell?
Turning to Wall Street, analysts have a Hold consensus rating on TSLA stock based on 15 Buys, 13 Holds, and nine Sells assigned in the past three months, as indicated by the graphic below. After a 97% rally in its share price over the past year, the average TSLA price target of $365.31 per share implies 15.03% downside risk.
