Tesla is recalling almost half of all the vehicles the company has so far produced, after corroding bolts that could lead to the loss of power steering has forced the company to fix 123,000 of its Model S sedans.
The service action comes at a particularly inopportune time for the California carmaker. Tesla’s stock fell by one-third of its value in recent weeks as a result of a series of problems including continued production problems with the Model 3 sedan, financial trouble, and a fatal crash now being probed by federal regulators.
“Reality is setting in,” said Joe Phillippi, head of AutoTrends Consulting, and a long-time Wall Street automotive analyst, as he warned that the sharp decline in Tesla stock might continue.
Time magazine reported that Tesla’s billionaire CEO Elon Musk has lost 17 percent of his personal fortune just in the last month.
Though Tesla shares rebounded slightly on Thursday, they began tumbling in off-hour trading in the wake of the recall announcement. According to an e-mail sent by the company to owners, 123,000 Model S sedans built before April 2016 are equipped with steering bolts that could suffer from excess corrosion. In some cases they may crack or completely fail.