Tesla recalls more than 80,000 cars in China over software and seatbelt issues

Tesla is recalling much than 80,000 cars successful China implicit bundle and seatbelt issues, the Chinese marketplace regulator said Friday.

The U.S. electrical car elephantine is recalling a full of 67,698 imported Model S and Model X vehicles produced betwixt Sept. 25, 2013 and Nov. 21, 2020, China's State Administration for Market Regulation said.

The callback of these models is owed to a bundle contented that affects the artillery absorption strategy of the cars. Tesla volition upgrade the bundle connected these vehicles escaped of charge.

Elon Musk's automaker is besides recalling 2,736 imported Model 3 vehicles produced betwixt Jan. 12, 2019 and Nov. 22, 2019 arsenic good arsenic 10,127 of the China-made mentation of this car owed to a perchance faulty seatbelt.

Tesla volition cheque the seatbelts connected the affected cars, the regulator said.

Tesla was not instantly disposable for remark erstwhile contacted by CNBC.

Investors volition beryllium watching for immoderate fallout for Tesla successful China from the recall. The marketplace is progressively competitory with home challengers from Warren Buffett-backed BYD to upstarts similar Nio and Xpeng.

"Recalls are ever costly and often get amplified successful a mode that tin beryllium reputationally damaging — particularly existent present arsenic the marketplace has go hyper-competitive and Tesla's backlog has been shrinking," Bill Russo, CEO at Shanghai-based Automobility, told CNBC.

"This callback mostly impacts imported models (S and X), truthful it tin beryllium managed if they get retired successful beforehand of it."

China is 1 of Tesla's astir important markets. The institution has a large accumulation mill successful Shanghai and has been selling a record fig of China made-cars successful caller months.

But Tesla besides faces rising contention successful China arsenic companies similar Xpeng, Nio and Li Auto ramp up caller car releases for 2023 in a bid to situation the U.S. electrical automaker's dominance.

Last month, Tesla slashed the price of Model 3 and Model Y vehicles successful China aft raising them earlier this twelvemonth owed to higher worldly costs.

It is not the archetypal clip that Tesla has had to callback cars successful China. In May, the U.S. steadfast recalled much than 100,000 cars owed to an overheating issue.

— CNBC's Sam Vadas contributed to this report.