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Elon Musk's latest cost-cutting move is shaking up the National Highway Traffic Safety Administration (NHTSA), the agency responsible for overseeing Tesla (NASDAQ:TSLA) and investigating crashes involving its self-driving technology. The cuts, described as modest, were implemented under Musk's Department of Government Efficiency, an initiative aimed at streamlining federal agencies. While NHTSA insists it remains committed to enforcing safety regulations, the downsizing raises concerns about whether oversight on autonomous vehicle safety will take a hitespecially as Tesla continues to face regulatory scrutiny.
Musk has long pushed back against NHTSA's investigations and recall mandates, calling them a roadblock to progress in self-driving technology. The Biden administration had previously expanded NHTSA's workforce, but Musk's team is now reversing that, raising questions about what regulations might be weakened or eliminated. One of the biggest concerns? The requirement for Tesla and other automakers to report crash data involving self-driving vehiclesa rule that Tesla has resisted and that watchdogs fear could now be on the chopping block.
Despite the shake-up, NHTSA says it's keeping key positions intact to ensure public safety. But with Tesla's self-driving tech under constant scrutiny and the possibility of regulatory rollbacks, investors will be watching closely to see if these cuts create tailwinds for Teslaor open the door to even more controversy.
This article first appeared on GuruFocus.