April 11, 2016 / 5:06 PM / in 2 years

Tesla to recall 2,700 Model X SUVs over seat issue

SAN FRANCISCO (Reuters) - Tesla Motors Inc TSLA.O will recall 2,700 Model X sport utility vehicles in the United States due to a faulty locking hinge in the third-row seats that increases the risk the seats could fall forward in a crash, the electric car maker said on Monday.

A Tesla logo is pictured on the hub of a car during the second media day of the 86th International Motor Show in Geneva, Switzerland, March 2, 2016. REUTERS/Denis Balibouse

It said the recall affects all Model X SUVs built before March 26, 2016. It is the first recall for the Model X since Tesla began deliveries of the luxury electric SUV in September.

The recall comes as Tesla enjoys an influx of advance orders for its Model 3 lower-cost sedan, which is due to begin production in late 2017. The car received 253,000 advance orders in the first 36 hours after its high-profile unveiling on March 31.

The Silicon Valley company said it was recalling the Model Xs after the seats failed a strength test in the European Union. Tesla had previously performed 15 tests in the United States in which the seats passed. The EU test was different and more stringent, the company said.

Tesla said it was issuing the recall in an abundance of caution in the United States even though it was not mandated to do so. The Model X has not yet been delivered to European customers.

The company’s shares were down 0.2 percent at $249.52 on Monday afternoon. The stock had jumped 77 percent since a February low thanks to the Model 3 unveiling.

Tesla will begin notifying customers of the recall on Monday. The repair, which will replace both third-row seats, will take about two hours. The process to fix all recalled cars will take about five weeks, Jon McNeil, Tesla’s president of sales and service, told reporters on a conference call.

“We’ve had no issues with any failures in the field,” he said.

Tesla said that supplier Futuris had manufactured the seats and would assume all cost for their replacement.

In November, Tesla recalled 90,000 Model S sedans worldwide over a possible defect in the front seat belt assembly. In 2014, the company recalled 29,222 Model S vehicles over a charging defect that could lead to a fire hazard.

Tesla has acknowledged bumpy production over the first few months for the Model X due to technical challenges with its “falcon-wing” doors, a panoramic windshield and moveable seats.

Those issues have not affected Tesla’s Model X production rates, McNeil said.

Editing by Matthew Lewis

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