Under the request of federal regulators, Tesla is due to push an update that will restrict the behavior of its most controversial driver-assistance system, labeled Full Self-Driving Beta, because it poses “an unreasonable risk to motor vehicle safety.”

The recall, detailed by the NHTSA Thursday, affects 362,758 vehicles, including the 2016-2023 Model S and Model X, the 2017-2023 Model 3, and the 2020-2023 Model Y, as equipped with Tesla’s Full Self-Driving (FSD Beta) upgrade, currently a $15,000 option. 

The issue relates to the vehicles’ behavior under that option and specifically, as the NHTSA lays out, what’s been termed FSD Beta or Autosteer on City Streets.

NHTSA notes: “The FSD Beta system may allow the vehicle to act unsafe around intersections, such as traveling straight through an intersection while in a turn-only lane, entering a stop sign-controlled intersection without coming to a complete stop, or proceeding into an intersection during a steady yellow traffic signal without due caution.”

The agency also says that the system may not respond sufficiently to changes in posted speed limits, or to the driver’s adjustment of speed.

Among the many items Tesla will need to adjust in a software update include the system’s yellow-light behavior, the duration of stops, its operating speed (based both on signs and driver), and its observation of lane rules.

“Analysis and testing performed as part of NHTSA’s Engineering Analysis (EA22-002) revealed that in certain situations, Tesla’s Autosteer on City Streets (Full Self Driving (FSD) Beta), led to an unreasonable risk to motor vehicle safety based on insufficient adherence to traffic safety laws,” stated the NHTSA, in a statement released to Green Car Reports. “​​As required by law and after discussions with NHTSA, Tesla launched a recall to repair those defects.”

As the federal agency notes, this recall does not address all the elements of its probe, which started as an investigation and advanced to an engineering analysis in June 2022. 

“Accordingly, NHTSA’s investigation into Tesla’s Autopilot and associated vehicle systems remains open and active,” stated the agency. 

Work performed at the NHTSA’s Vehicle Research and Test Center was reportedly critical to assessing how the system performed in certain scenarios. 

The remedy is to be delivered over the air, but in complying with the recall, Tesla will mail out owner notification letters by April 15, 2023. Owners are instructed to call Tesla customer service at 877-798-3752.

In 2021 the head of the National Transportation Safety Board (NTSB) called Tesla’s use of Full Self-Driving branding to be “misleading and irresponsible,” and last year longtime consumer advocate Ralph Nader called for the NHTSA to order the removal of full self-driving from Tesla vehicles entirely. Tesla also faces scrutiny from the DOJ and SEC over its self-driving claims. 

That hasn’t stopped Tesla from hiking the price of Full Self-Driving to $15,000 and broadening its so-called beta features. CEO Elon Musk has in the past suggested that the system is a direct on-ramp to turning many of its vehicles into robotaxis that will become revenue-generators for owners.