Tesla could benefit most from new rules on reporting of self-driving car crashes

Rule changes announced by the Trump administration this week could allow automakers to report fewer crashes involving self-driving cars, with Tesla potentially emerging as the main beneficiary.

The Transportation Department announced Thursday that it will no longer require automakers to report certain kinds of non-fatal crashes, but the exception will apply only to partial self-driving vehicles using so-called Level 2 systems, the kind Tesla deploys. Tesla CEO Elon Musk had complained that the old reporting rules cast his company in a bad light.

If Tesla and other automakers are required to report fewer crashes into a national database, that could make it more difficult for regulators to catch equipment defects and for the public to access information about a company's overall safety, auto industry analysts say. It will also allow Tesla to trumpet a cleaner record to sell more cars.

“This will significantly reduce the number of crashes reported by Tesla," said auto analyst Sam Abuelsamid at Telemetry Insight. Added Dan Ives of Wedbush Securities, noting that Tesla rival Waymo won’t get an exception, “This is a win for Tesla, a loss for Waymo."

Tesla stock soared nearly 10 per cent on Friday on the rule changes. Wall Street analysts and Musk critics have said that Musk’s role as an adviser to President Donald Trump could put Tesla in a position to benefit from any changes to regulations involving self-driving cars.

Other car makers such as Hyundai, Nissan, Subaru and BMW make vehicles with Level 2 systems that help keep cars in lanes, change speed or brake automatically, but Tesla accounts for the vast majority on the road. Vehicles used by Waymo and others with systems that completely take over for the driver, called Automated Driving Systems, will not benefit from the change.

The National Highway Traffic Safety Administration, which enforces vehicle safety standards, said the new rules don’t favour one type of self-driving system over another, and that raft of changes it announced will help all self-driving automakers.

“No ADS company is hurt by these changes," the agency said in statement to The Associated Press, using the acronym for Automatic Driving System. It added that the changes also make sense because “with ADS, no driver is present meaning stronger safety protocols are needed."

Waymo declined to comment for this story. The AP reached out to Tesla but did not receive a reply.

Under the change, any Level 2 crash that is so bad it needs a tow truck to come will no longer be required to be reported if it doesn’t result in death or injury or air-bag deployment. But if a tow truck is called for crashes of vehicles using ADS, it has to be reported.

The vast majority of partial self-driving vehicle crashes reported under the old NHTSA rules involved Teslas — more than 800 of a total 1,040 crashes in the past 12 months, according to an AP review of the data. It’s unclear how many of those Tesla crashes required the vehicles to be towed, because a column requesting that information in the database is mostly blank.

The NHTSA said after the story was published that only 8% of total reported crashes under the old criteria were cases in which partial self-driving vehicles had to be towed away, and there was no other qualifying crash-reporting factor involved. It is not clear about cases where tow-away information wasn’t provided.

The relaxed crash rule was part of several changes described by the Transportation Department as a way to “streamline" paperwork and allow U.S. companies to better compete with China in the race to make self-driving vehicles. The department said it would also move toward national self-driving regulations to replace a confusing patchwork of state rules.

“We’re in a race with China to out-innovate, and the stakes couldn’t be higher," said Transportation Secretary Sean Duffy on Thursday. “Our new framework will slash red tape and move us closer to a single national standard."

Traffic safety watchdogs had feared that the Trump administration would eliminate the NHTSA reporting requirement completely.

The package of changes came days after Musk confirmed on a conference call with Tesla investors that the electric vehicle maker will begin a rollout of self-driving Tesla taxis in Austin, Texas, in June. Waymo, which is owned by Google parent Alphabet, already has cybercabs available in that city and several others.

Musk has argued that the previous reporting requirements were unfair since Tesla vehicles all use its partial self-driving systems and therefore log more miles than any other automaker with such technology. He says that his cars are far safer than most and save lives.

Tesla sales have plunged in recent months amid a backlash against Musk’s backing of far-right politicians in Europe and his work in the U.S. as head of Trump’s government cost-cutting group. The company has pinned its future on the complete automation of its cars, but it is now facing stiff competition from rivals, especially the Chinese automaker BYD.

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