Trump Transition Team's Proposal to Eliminate Car Crash-Reporting Rule

Investing,com — The Trump transition team proposed eliminating a federal car crash-reporting rule opposed by Tesla (NASDAQ:TSLA), which could undermine the government’s ability to monitor and regulate automated-driving system safety, as reported by Reuters on Friday.

This suggestion, found in a transition team document, coincides with Tesla’s desire to reduce what it deems "excessive" data collection.

Elon Musk, CEO of Tesla and the world’s richest individual, contributed over $250 million to support Trump’s 2016 election campaign.

Impact on Tesla

The removal of the crash-reporting rule would be advantageous for Tesla, which has reported over 1,500 incidents to the National Highway Traffic Safety Administration (NHTSA) since the rule's inception in 2021. These reports have prompted federal investigations into Tesla’s driver-assistance technologies, including three inquiries initiated by crash data.

The transition team, responsible for drafting a 100-day automotive policy plan, asserted that the rule unnecessarily burdens automakers. The Alliance for Automotive Innovation, representing most major automakers except Tesla, similarly criticized the rule as overly burdensome.

Data analyzed by Reuters revealed that Tesla vehicles accounted for 40 of the 45 fatal crashes reported to the NHTSA through mid-October. Notable incidents included a 2023 accident in Virginia where a Tesla using its “Autopilot” feature collided with a tractor-trailer, and another crash in California that year where an Autopilot-engaged Tesla struck a firetruck, resulting in a fatality and injuries to firefighters.

NHTSA's Defense and Future Recommendations

The NHTSA has defended the rule, highlighting its significance in monitoring and evaluating advanced vehicle technologies. Since its implementation, the agency has analyzed data from over 2,700 crashes, which has led to several investigations and recalls involving Tesla and other manufacturers.

Former NHTSA employees indicated that without such reporting, identifying safety risks would be considerably more challenging.

Tesla’s leadership has voiced dissatisfaction with the reporting requirements, asserting that the data casts the company in a negative light. Internal sources indicated that Tesla believes these reports create a misleading perception of its safety record due to the company's extensive data collection compared to its competitors. However, the NHTSA cautioned against drawing direct safety comparisons between manufacturers based on this data.

The crash-reporting rule mandates that automakers notify the agency of accidents involving driver-assistance systems or autonomous technologies engaged within 30 seconds of a collision.

Besides recommending the repeal of this requirement, the transition team also suggested deregulating the autonomous vehicle industry to foster growth and simplify federal oversight.

In an October earnings call, Musk advocated for a unified federal approval process for autonomous vehicles, criticizing the complexity of state regulations. He hinted at using his anticipated role as Trump’s "government-efficiency czar" to promote regulatory changes favorable to the industry.

Tesla's driver-assistance systems, including “Autopilot” and “Full Self-Driving,” have come under increased scrutiny amid lawsuits and a Department of Justice criminal investigation into possible exaggerations of their capabilities.

Experts, like Bryant Walker Smith from the University of South Carolina, propose that Tesla's extensive data collection and the broader deployment of these systems likely contribute to its higher number of reported incidents. Smith noted that frequent usage may expose vehicles to scenarios exceeding their operational capabilities.

The ongoing discourse highlights the tensions between regulatory oversight and industry growth in the fast-evolving autonomous-driving landscape.