U.S. reviewing suspension complaints in Tesla Model S cars

A Tesla logo hang on a building outside of a Tesla dealership in New York, U.S., April 29, 2016. REUTERS/Lucas Jackson (Reuters)

By David Shepardson WASHINGTON (Reuters) - A federal regulator said on Thursday it is reviewing reports of suspension problems in Tesla Motors Inc's Model S sedans, and is investigating whether the company urged customers to sign agreements not to disclose the problem. A spokesman for the U.S. National Highway Safety Administration (NHTSA), Bryan Thomas, said the agency is "examining the potential suspension issue on the Tesla Model S, and is seeking additional information from vehicle owners and the company." The safety review follows reports of a possible defect in the Tesla Model S that may cause suspension control arms to break, which could cause the driver to lose control of the car. A review is a step before the agency decides whether to open a formal investigation leading to a potential safety recall. In addition, NHTSA said it learned that Tesla had entered into what it called a "troublesome nondisclosure agreement" with a Tesla Model S owner who had suspension problems. A Tesla spokeswoman said she was looking into NHTSA's statement, declining to immediately elaborate. NHTSA Administrator Mark Rosekind said in an interview on the sidelines of a transportation event in Washington that the agency is in "data collection mode." "Part of what we have to figure out is whether or not (non disclosure agreements) might have impeded people making (complaints)," Rosekind said, adding that the agency has been in touch with Tesla seeking information. "Our folks were on this right away." It is not clear how many other similar non-disclosure agreements, if any, Tesla may have with other owners, Rosekind said. Rosekind said he was unaware of any other automaker requiring owners to sign agreements barring them from disclosing defects. CONFIDENTIAL ARRANGEMENT The possible safety defect in the Tesla Model S was reported on earlier this week by the auto-oriented website dailykanban.com, which cited owner complaints. The website linked to a Model S owner who wrote on a Tesla fan website that said he had suspension problems and had received an email from an NHTSA investigator. The owner said Tesla agreed to pay 50 percent of a $3,100 repair bill if the owner agreed to keep confidential the arrangement. The NHTSA said Thursday it "learned of Tesla’s troublesome nondisclosure agreement last month. The agency immediately informed Tesla that any language implying that consumers should not contact the agency regarding safety concerns is unacceptable, and NHTSA expects Tesla to eliminate any such language." The agency said Tesla "told NHTSA that it was not their intention to dissuade consumers from contacting the agency. NHTSA always encourages vehicle owners concerned about potential safety defects to contact the agency." The dailykanban also reported a now-resolved complaint dated May 20 against Tesla filed with the Better Business Bureau in California that alleged the company had required a non-disclosure agreement for repossession of a defective Tesla Model X. Anonymous individuals have filed a number of complaints of suspension problems on NHTSA's website, citing salvaged Tesla vehicles. Shares of Tesla closed down 2.6 percent at $229.36 on the Nasdaq. NHTSA has never opened a formal investigation into the Model S for any safety issue. Tesla recalled nearly 59,000 2012-2015 Model S vehicles in the United States in November for seat belts that may have been improperly connected to the pretensioner, which could mean front seat occupants might not be properly restrained in the event of a crash. There were no reports of crashes or injuries. (Reporting by David Shepardson; Editing by Leslie Adler)