• Tesla is recalling nearly 200,000 cars due to a "software instability" that prevented the rearview camera image from displaying, the National Highway Traffic Safety Administration said Friday.
• Certain Model S, X, and Y vehicles equipped with full self-driving 4.0, Tesla's driverless software system, were affected by the software bug, the NHTSA said.
• Tesla's latest recall follows a record 2-million-car recall last month over a defective system designed to ensure drivers were paying attention while using Autopilot.

Electric vehicle maker Tesla is recalling nearly 200,000 cars in the U.S. due to a "software instability" that prevented the rearview camera image from displaying, according to the National Highway Traffic Safety Administration (NHTSA).

The U.S. agency said in a recall update on its website that Tesla was recalling certain 2023 Model S, X, and Y vehicles equipped with full self-driving 4.0, the company's driverless software system, due to the software bug.

Tesla shares were slightly higher in premarket trading Friday.

The potential number of cars affected by the recall is 199,575, the NHTSA said. Tesla's reference number for the recall is SB-24-00-002 and customers with questions are advised to speak to the company's customer services.

The company has already released an over-the-air software update free of charge to owners to remedy the issue, the NHTSA said, and owners are expected to be notified of the recall by mail starting March 22.

A recall is where a car manufacturer finds a potential safety issue with a vehicle. Automakers typically offer free repairs for these issues, and customers are informed by letter or other customer communications.

Tesla's latest recall follows a record one last month, when the automaker recalled 2 million Tesla vehicles over a defective system that was designed to ensure drivers were paying attention when using its Autopilot feature. It came after a series of deadly crashes involving Tesla's Autopilot software that were investigated by the NHTSA.

The move also follows a grim financial outlook from Tesla earlier this week. The automaker said Wednesday that its vehicle volume growth in 2024 "may be notably lower" than the rate observed last year, as it works toward launching its "next-generation vehicle" in Texas.

Tesla shares closed down 12% on Wednesday off the back of the disappointing guidance.

Tesla has also been cutting the prices of its cars aggressively. The company recently slashed prices in Europe by as much as 8.1%, adding to a slew of cuts made last year as Tesla tries to maintain its lead in electric vehicles.

Its position has been challenged in recent times, not least by BYD, the Chinese electric carmaking giant.

BYD, which is backed by legendary investor Warren Buffett, topped Tesla as the largest EV maker by sales in the fourth quarter.