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Tesla fans call for recall terminology update, but the NHTSA isn’t convinced it’s needed
Tesla fans have been calling for an update in recall terminology ever since Over-the-Air updates became more popular in resolving vehicle issues. However, the NHTSA, the agency responsible for handling recalls and vehicle safety, is not convinced that it is needed.
The majority of Tesla’s vehicle recalls are performed through software remedies, which makes things complicated when it comes to headlines. Far too often, media outlets run with headlines like “Tesla recalls 2 million vehicles for safety issue,” when in reality, the issue is something small and fixable through a software update that downloads and is applied while the owner is asleep.
Fans are not the only ones calling for a terminology update. CEO Elon Musk is calling for one as well and has on several occasions.
‘Outdated & Inaccurate’
After a 2022 “recall” on over 1 million Teslas for a window issue, mainstream media pushed the narrative that 1 million EVs were in need of a major fix. In reality, the problem was remedied through a software download and update, and not a single car needed to go to a service center for repair.
“The terminology is outdated & inaccurate. This is a tiny over-the-air software update. To the best of our knowledge, there have been no injuries,” Musk said in response to the recall.
The terminology is outdated & inaccurate. This is a tiny over-the-air software update. To the best of our knowledge, there have been no injuries.
— Elon Musk (@elonmusk) September 22, 2022
More recently, a 2 million-vehicle recall was initiated by Tesla and the NHTSA to increase font size.
“On affected vehicles, the letter font size of the Brake, Park, and Antilock brake system (ABS) visual warning indicators is smaller than 3.2 mm (1/8 inch), as prescribed in FMVSS Nos. 105 and 135,” the NHTSA said in its 573 Safety Recall Report.
Tesla’s font size causes 2.2 million vehicle ‘recall’ that’s really just an OTA upate
The 2.2 million vehicles affected were given a software update, which was downloaded and applied to all vehicles. It increased the font size without anyone needing to physically take their cars to a showroom.
‘No difference to the safety risk posed by a defect’
From the NHTSA’s perspective, recall still fits the bill of anything from a steering wheel that falls off to the font size being a size too small.
Teslarati reached out to the agency last week, asking if there were any internal plans or discussions regarding the terminology of a recall. In reality, there are more companies than just Tesla that would benefit from an update in terminology.
Ford is another company that has used Over-the-Air updates to solve vehicle problems.
The NHTSA told us that any defect, big or small, fits the bill of a recall, and whether it can be resolved through software or through a physical repair makes no difference. It’s still a safety issue:
“Defects that pose an unreasonable risk to safety are serious and should be remedied as soon as possible. The Vehicle Safety Act requires manufacturers to issue recalls to remedy safety defects. Whether a remedy can be completed at a local dealership or through an over-the-air software update makes no difference to the safety risk posed by a defect.”
Recalls are an acknowledgment of a safety defect in a vehicle, and how they’re repaired does not play into the terminology used. Recalls are important because they alert a vehicle owner of an issue, and sometimes, the OTA update may not be successfully applied, or it could persist after the fix is sent through software.
Comparing Vehicle Recalls to Phone Updates
A common comparison used by people who oppose the use of the word “recall” to describe an OTA update is that of a smartphone update.
iPhones are common recipients of software updates, and you’ll see people online facetiously say, “My iPhone is getting recalled!”
The NHTSA does not see a comparison, considering vehicle safety defects can put lives at risk on the road. The driver is at risk if things are not fixed, and others can be put in harm’s way as well.
Unfortunately, those who disagree with the use of the word “recall” may have to deal with it. It does not seem that the NHTSA has any plans to update the terminology used because the medium of repair is not what a recall applies to. It is the issue itself.
I’d love to hear from you! If you have any comments, concerns, or questions, please email me at joey@teslarati.com. You can also reach me on Twitter @KlenderJoey, or if you have news tips, you can email us at tips@teslarati.com.
Tesla stock (NASDAQ: TSLA) endured one of its sharpest single-day declines in years on July 23, tumbling approximately 14.5 percent and closing near $320 after opening the session around $374. The drop erased more than $140 billion in market value amid heavy trading volume and left the shares at multi-week lows.
The sell-off followed the company’s second-quarter 2026 results, released the previous evening. Tesla reported record revenue of $28.2 billion, up 26 percent year over year, driven by a Q2-record 480,126 vehicle deliveries. Energy storage deployments also rose strongly.
Tesla (TSLA) Q2 2026 earnings results: miss on EPS, beat on revenue
Yet profitability disappointed sharply. Operating income fell 57 percent to $398 million, compressing the operating margin to just 1.4 percent. Non-GAAP earnings per share came in at $0.33, well below the roughly $0.53 analysts had expected. Free cash flow turned negative by $1.1 billion as capital expenditures surged 142 percent to $5.8 billion, largely tied to accelerated spending on artificial intelligence, robotics, and autonomous systems.
The losses on capex were expected, as Tesla said it would be spending heavily in 2026.
Investors also reacted to lingering uncertainty surrounding key product timelines. During the Earnings Call, management reiterated ambitions for Robotaxi deployment and the Optimus humanoid robot, but offered limited new concrete milestones, renewing questions about execution pace that have long accompanied Tesla’s ambitious roadmap.
The magnitude of the decline places it among Tesla’s more severe one-day percentage losses since its 2010 initial public offering. Historically, the two largest single-day drops (split-adjusted) remain September 8, 2020, when shares fell 21.1 percent amid broader market volatility and valuation concerns, and January 13, 2012, with a 19.3 percent plunge during the company’s early growth struggles.
Other notable declines include an 18.6 percent drop on March 16, 2020, at the onset of pandemic-related market turmoil. Thursday’s move ranks roughly ninth on the all-time list but stands out as the steepest in more than a year.
Despite the short-term pain, Tesla’s long-term trajectory has repeatedly recovered from such volatility. The latest results underscore both the strength of its core automotive and energy businesses and the near-term costs of heavy investment in next-generation technologies.
Elon Musk clapped back at France’s decision to withhold the approval for Tesla’s Full Self-Driving (FSD) Supervised system, projecting a clear and blunt message to French Transport Minister Phillippe Tabarot, after he publicly rejected the technology in its current form.
Tabarot outlines several concerns with Tesla Full Self-Driving in a detailed video statement, where he said, “The safety trade-offs are not yet sufficient to authorize it as it currently stands,” he said. He emphasized that FSD is not a true self-driving system and that the driver remains fully responsible.
Key issues Tabarot also brought up included allowing speeding when surrounding traffic exceeds limits and what he believes are insufficient guarantees of driver attention during complex urban maneuvers such as lane changes, intersections, and roundabouts.
Delaying the approval of FSD in France will cost lives
— Elon Musk (@elonmusk) July 22, 2026
While acknowledging technological progress and France’s support for autonomous innovation, Tabarot stressed that deployment must prioritize road safety. He noted ongoing technical discussions with Tesla, the Netherlands, and other European partners, with further ecosystem meetings planned for the fall.
Musk’s rebuke highlights the human cost of regulatory caution. Tesla’s latest safety reports provide compelling data supporting accelerated adoption. In the most recent 12-month period, vehicles using FSD (Supervised) recorded one major collision per approximately 5.1 million miles driven, dramatically better than the U.S. national average of one crash per 698,000 miles.
Even Tesla vehicles driven manually with active safety features outperform the average by a wide margin. These figures come from billions of real-world miles of telemetry, showing FSD vehicles involved in far fewer incidents than both manual Teslas and the broader U.S. fleet.
Critics argue Tesla’s comparisons require careful scrutiny regarding reporting thresholds and fleet demographics, yet the data consistently positions FSD as a potential lifesaver. With road fatalities remaining a leading cause of death worldwide, Musk contends that proven safer technology should not face prolonged bureaucratic hurdles.
France’s measured approach reflects the broader European regulatory caution, which many, especially Musk, have been critical of in the past. However, as autonomous systems from Tesla and competitors like Waymo demonstrate superior safety in independent studies, pressure is mounting for harmonized approvals.
Musk’s warning carries the belief that every month of delay may equate to avoidable tragedies on European roads.
In a striking revelation that underscores the lucrative crossover between Big Tech and space exploration, Alphabet Inc., Google’s parent company, disclosed a massive $94.1 billion equity stake in SpaceX following the rocket company’s blockbuster initial public offering earlier this year.
The disclosure came in Alphabet’s quarterly filing, marking the first time the long-held private investment has been publicly valued at market prices. Google was an early backer, investing alongside Fidelity in 2015 with roughly $500-900 million at a time when SpaceX was valued around $12 billion.
That bet has delivered extraordinary returns, roughly a hundredfold, transforming a strategic play on satellite internet and launch capabilities into one of Alphabet’s largest assets.
Google, $GOOGL, has said they hold $94 billion in SpaceX, $SPCX, shares after IPO.
— unusual_whales (@unusual_whales) July 23, 2026
Of the total holding, approximately $80 billion remains subject to short-term post-IPO lockup restrictions, preventing near-term sales. An additional $14.1 billion faces longer-term restrictions, extending into the third quarter of 2027. This structure limits immediate liquidity but protects against market volatility as SpaceX transitions into public trading.
The SpaceX position contributed significantly to gains in Alphabet’s broader investment portfolio, which also includes a major stake in AI leader Anthropic. Combined, these holdings helped drive nearly $100 billion in investment gains during the second quarter, providing a substantial boost to net income amid ongoing AI spending pressures.
Analysts view the disclosure as validation of Alphabet’s venture strategy beyond its core search and cloud businesses. The investment aligns with deeper ties, including reported multi-billion-dollar deals for AI computing capacity on SpaceX infrastructure. As SpaceX advances Starship flights, Starlink expansion, and ambitious Mars goals under Elon Musk, Google’s stake positions it to benefit from the commercialization of space.
For Alphabet, the windfall highlights how patient, forward-looking bets in transformative sectors can yield outsized rewards. While lockups temper short-term impact, the holding cements SpaceX as a cornerstone of Alphabet’s diversified portfolio in an era where aerospace, AI, and connectivity increasingly intersect. Investors will watch closely as restrictions lift and SpaceX’s public performance unfolds.
Tesla stock tumbles after earnings, one of its sharpest single-day declines
Elon Musk is not happy about this Tesla Full Self-Driving approval delay
