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Tesla faces backlash over hardware downgrade affecting made-in-China Model 3 vehicles

The EV maker blamed supply chain issues.

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Tesla is facing a backlash in China after receiving numerous complaints from Chinese customers over an undisclosed hardware downgrade on their locally-made Model 3 vehicles, local media 36Kr reported on Tuesday.

Model 3 owners posted on Weibo that their new vehicles were delivered with the company’s HW 2.5 self-driving controller hardware instead of the newest HW 3.0 version. Customers reportedly discovered the issue after noticing that the vehicle’s controller code described the HW 2.5 version, rather than the HW 3.0.

The US-headquartered electric vehicle (EV) maker upgraded its self-driving hardware to the 3.0 version in 2019. The new hardware, powered by Tesla’s latest in-house Full Self-Driving (FSD) chip, is capable of processing images 21 times faster than the previous version, which was equipped with the Drive PX2 chip developed by NVIDIA.

All Model 3 vehicles produced after April 2019 should have the latest HW 3.0 controller, according to 36Kr, citing Tesla’s founder Elon Musk.

Tesla issued a statement on Weibo on Tuesday in response to the complaints, saying the issue was due to supply chain problems. The EV maker promised to offer free replacements to those vehicles installed with HW 2.5 hardware once production capacity and the supply chain recover.

Tesla clarified in the statement that the downgrade only affects customers who opted out of purchasing Tesla’s Full Self-Driving (FSD) suite, an advanced version of the company’s autopilot feature that currently includes auto lane changes, auto park, and summons capabilities. For those without the FSD upgrade, the driving experience with HW 2.5 and HW 3.0 is virtually the same, the company said.

Tesla was one of the first automakers to restart operations in China amid the coronavirus crisis. Tesla’s Shanghai Gigafactory resumed production on Feb. 10, after the facility was forced to close down temporarily by the Shanghai government.

The company has reportedly produced 2,625 Model 3 vehicles at the Shanghai factory in January prior to the temporary shutdown, which placed Tesla fifth among all EV makers in China by number of vehicles manufactured that month.

36Kr is KrASIA’s parent company.