According to a report by the Wall Street Journal published Monday afternoon, the US Securities and Exchange Commission (SEC) is investigating whether Tesla Motors should have disclosed the nature and circumstances of a recent fatal crash to investors earlier than it did.
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Federal officials are investigating a May 7 crash in Florida that killed a man after his Model S’s cameras failed to detect a turning tractor-trailer and did not automatically activate the brakes.
The car’s software notified Tesla of the crash, and Tesla reported it to the National Highway Traffic Safety Administration.
A source close to the investigation told The Wall Street Journal that the SEC is digging into whether Tesla should have disclosed the May 7 accident to investors as a “material” event-that is, one that would be of interest to a reasonable investor in the company.
“Tesla has not received any communication from the SEC regarding this issue”, a company representative told Business Insider on Monday. Tesla is offering US$2.5-3 billion for the company, but according to some analysts, this is an unjustifiably high price. And NHTSA is looking into a July 6 crash in Pennsylvania in which a Model X flipped upside down while, its driver said, it was in self-driving mode.
But Tesla fired back with a blog post asserting it hadn’t even finished its investigation into the crash until “the last week of May”, or after the stock offering. By SEC rules, companies must report “material” events to shareholders, although auto companies do not generally report individual vehicle crashes to investors.
Tesla and other automakers have been working on autonomous driving features, seen as one step toward self-driving vehicles with an eye toward improving road safety.
The accident calls into question the safety of drivers who activate the new autopilot feature that controls the steering and braking capabilities of the vehicle. “Our blog post last week provided the relevant information about this issue”, a Tesla spokeswoman said in an email.
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The investigations related to the Autopilot system come at a time when Musk and his high-flying company are under pressure on several fronts. Tesla did not provide any further details.
