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Tesla Falls 4% Early Friday, Company's Autopilot Feature Linked To Death Of Model S Owner

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Tesla Falls 4% Early Friday, Company's Autopilot Feature Linked To Death Of Model S Owner

Shares of Tesla Motors Inc (NASDAQ: TSLA) were trading lower by around 4 percent early Friday morning after various news agencies reported that U.S. auto-safety regulators are examining a fatal crash involving a Model S owner that was driving itself.

According to the Wall Street Journal, the National Highway Traffic Safety Administration (NHTSA) is investigating what very well could be the first crash resulting in death from a car that was driving in self-driving mode. Joshua Brown, a Tesla Model S owner from Ohio, tragically died when his vehicle drove under the trailer of an 18-wheel truck in Florida.

The Wall Street Journal noted that the truck driver, Frank Baressi, said that the Tesla vehicle was moving at a high speed and believes the driver was watching a movie at the time of the crash. The publication added that Tesla said the autopilot feature didn't automatically break because the truck was not detected given certain conditions.

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"Neither Autopilot nor the driver noticed the white side of the tractor trailer against a brightly lit sky, so the brake wasn't applied," the Wall Street Journal quoted Tesla as saying. "The high ride height of the trailer combined with its positioning across the road and the extremely rare circumstances of the impact caused the Model S to pass under the trailer, with the bottom of the trailer hitting the windshield of the Model S."

The NHTSA confirmed on Thursday it is examining the death and would likely increase scrutiny on the autopilot feature for all companies involved in the space. However, the investigation is still in its preliminary stages but nevertheless appears to be sufficient to spook investors.

Shares of Mobileye NV (NYSE: MBLY), an Israel-based pioneer in the self-driving auto technology, also saw its shares trade lower by around 4 percent early Friday morning.

 

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