The issue is said to be caused by a "small gear that could have been manufactured improperly by our third-party supplier" and could effectively cause the parking brake to stick in place, preventing the auto from moving. The US luxury electric auto manufacturer's shares dropped over 1 percent following its announcement on Thursday.
"We are working with Tesla to ensure the issue is resolved quickly", a spokeswoman reportedly said.
Tesla is recalling 53,000 of its Model X and Model S vehicles built between February and October 2016. The company told owners it believes less than 5 percent of the recalled vehicles could actually have a parking brake failure.
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Munoz and other executives vowed to treat customers with dignity, and said that what happened to Dao will never happen again. According to Dao's attorney, the man suffered a concussion and a broken nose in the incident, and lost two teeth.
In 2009, it announced it would be recalling 345 Tesla Roadsters manufactured before April 22 of that year after one owner reported an issue in the vehicle's rear inner hub flange bolts. If the gear breaks, the parking brake could get stuck in place.
The recall comes two weeks after Tesla Motors surged in value to overtake General Motors in market capitalization.
Tesla produced a total of 83,922 vehicles in 2016, including the Model S and Model X.
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McNeill emphasized the importance of the Korean market, saying although it stands in the 11th spot in the global economic rankings, it is in fifth place in the luxury auto market. Tesla said that they have not received any complaint regarding the parking brake failure and that it's "safe to continue regular use of your vehicle".
Jonathan McNeill, president of global sales and service of Tesla, during the opening of the company's service center in Hong Kong in November.
Following recent software update that was a part of Tesla's AP2.0 the auto started "behaving as if a drunk driver is at the wheel" when Autopilot is engaged, the suit said, citing a customer report. Though investors reacted negative to the recall and lawsuit issue, they have settled down to see the stock reversing the trend on Friday's pre-market trading.
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Earlier, Tesla issued a voluntary recall for 1,228 Model S electric sedans manufactured between May 10 and June 8 of 2013 to fix a potentially weakened left-rear seat attachment striker bracket.