Tesla vehicles under investigation as Musk reaches stock selling goal

The National Highway Traffic and Safety Administration (NHTSA) announced Wednesday its “Office of Defects Investigation (ODI) is opening a Preliminary Evaluation (PE)” of Tesla’s “Passenger Play” feature. The feature, found in various 2017-2022 Tesla Model 3, S, X, and Y vehicles, reportedly allows drivers to play video games on a screen while the car is in motion. In a document on the NHTSA website, Passenger Play “may distract the driver and increase the risk of a crash”.

“This capability has been available since December 2020 in Tesla ‘Passenger Play’-equipped vehicles,” NHTSA said in the document. “Prior to this time, gameplay was enabled only when the vehicle was in park.” However, after a software update, Tesla owners started to realize that a few games still worked when the car was in drive. That feature was eventually broadcasted in various youtube videos.

The investigation spans 580,000 vehicles. As of Wednesday, Tesla has not publicly reacted to the investigation. The company’s stock did surge nearly 4% in morning trading on Wednesday.

The investigation comes a day after Tesla CEO Elon Musk said he had sold “enough stock” to reach his plan to sell 10% of his shares in the company. 583,611 of those shares were sold Tuesday, bringing the total number of shares he has offloaded to 13.5 million. Out of that 13.5 million, 8.06 million were sold to pay taxes related to his options to exercise, according to Tesla’s securities filings.

“I sold enough stock to get to around 10% plus the option exercise stuff and I tried to be extremely literal here,” Musk said in an interview released Tuesday. The interview came two days after Musk tweeted that he would pay more than $11 billion in taxes this year.

Last month, Musk asked his Twitter followers if he should make the sale. He later admitted he needed to sell stock no matter the result because he had stock options expiring next year. Musk still has more than 3 million stock options which expire in August next year. This could prompt him to sell a portion of them to pay for taxes.