Shares of Chinese electric vehicle makers fell on Monday after regulators announced a record recall of 4.3 million vehicles due to safety concerns over concealed door handles.
The recall involves Tesla and eight other automakers, including Xiaomi, Li Auto, Xpeng, NIO, BYD, Leapmotor and Geely. Xiaomi’s stock led declines, dropping 4% after the company announced a recall covering parts of its SU7 range. Li Auto slid 3%, Xpeng fell 2.66%, NIO declined 1%, Leapmotor lost 1.7% and Geely dropped 1.1%. BYD’s Hong Kong-listed shares fell 2% while Tesla’s U.S. shares had not yet begun trading at the time of publication.
The safety issue centers on electronically operated, flush-mounted door handles that replace traditional mechanical systems. Regulators have raised concerns that these designs may complicate emergency egress in power-loss scenarios, such as after a crash. Passengers could struggle to escape, and rescuers may face difficulty opening doors from the outside without a clearly accessible manual release.
Automakers are addressing the recalls through low-cost measures, including warning labels and over-the-air software updates. The recalls follow China’s announcement in February that it would ban hidden door handles starting in 2027, becoming the first country to implement such a rule. The U.S. National Highway Traffic Safety Administration also indicated in July that it would introduce a formal safety standard covering all automakers. European regulators have separately flagged risks associated with the door-handle design.
