Tesla Revises Customer Nondisclosure Agreements
June 10 2016 - 4:30PM
Dow Jones News
Tesla Motors Inc. is revising nondisclosure agreements to
address concerns customers were discouraged from reporting possible
safety problems with the Silicon Valley company's vehicles, said a
person familiar with the matter.
The Palo Alto, Calif., electric car maker revised the agreements
to make clear the contracts don't prohibit customers from reporting
suspected safety problems to the U.S. National Highway Traffic
Safety Administration, this person said.
The move comes after suggestions from an automotive blog and
regulators that agreements Tesla asked customers to sign in
exchange for covering some repair costs could prevent them from
disclosing possible safety issues to U.S. regulators.
Regulators Thursday called the nondisclosure agreement
"troublesome." Tesla earlier called "preposterous" suggestions it
used contracts that attempted to prevent customers from alerting
government officials to safety problems. The revision of the
agreements was earlier reported by Automotive News.
At issue was a "goodwill agreement" that a Model S sedan owner
in Pennsylvania signed after claiming in an online forum that he
had a broken suspension. Faulty suspensions can cause motorists to
lose control.
The automotive blog Daily Kanban subsequently reported on the
alleged safety problem and suggested the agreement could prevent it
from being reported to regulators. The blog also pointed to a
possible defect in Tesla's Model X sport-utility vehicle.
The NHTSA on Thursday said it was examining the suspension
problem. The inquiry was in the earliest stages and no formal
investigation had been opened. Regulators typically screen myriad
complaints and claims from consumers and safety advocates about
potential problems across a variety of vehicle models without
finding significant dangers exist.
Tesla in its own blog posted a lengthy response rebutting claims
of safety defects or improper agreements with customers. Tesla
added that it was cooperating with the NHTSA and that the agency
has said it doesn't need any further information from the
company.
Write to Mike Ramsey at michael.ramsey@wsj.com and Mike Spector
at mike.spector@wsj.com
(END) Dow Jones Newswires
June 10, 2016 16:15 ET (20:15 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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