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Tesla is in strong competition with Hyundai Motor Co in South Korea. A transport ministry official said the braking and steering systems including the Autopilot function were part of the tests.
South Korean media have said Tesla’s Model 3 was under investigation.
They said the probe could take anywhere from six months to a year.
An official at the South Korean unit said Tesla would cooperate with the investigation.
This comes after the US National Transport Safety Board said driver errors and Tesla’s Autopilot design were a probable cause of a crash in 2018 of a Model S in California.
In March 2019, a Tesla that was travelling above the speed limit crashed into a truck towing a trailer in the US.
A report said the driver did not appear to have his hands on the wheel.
Autopilot had been engaged 10 seconds before the crash, according to the preliminary report.
The driver nor the Autopilot took any evasive action before the crash.
Tesla said it was the only time during the journey that Autopilot had been used.
In a statement, the company said: “Tesla drivers have logged more than one billion miles Autopilot engaged, and our data shows that, when used properly by an attentive driver who is prepared to take control at all times, drivers supported by Autopilot are safer than those operating without assistance.”
Tesla do not recommend drivers remove their hands from the wheel after activating Autopilot.
In Hyundai’s home market, Tesla has had its best month in June.
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The Model 3 beat Hyundai’s Kona EV as well as models from BMW and Audi.
Elon Musk, Tesla’s chief executive, said the company is open to licensing software and supplying powertrains and batteries.
The firm has previously supplied batteries to Mercedes and Toyota Motor in separate partnership deals.
Analysts and industry officials said Tesla have a competitive edge when it comes to battery manufacturing.
Mr Musk said on Twitter: “Tesla is open to licensing software and supplying powertrains and batteries.
“We’re just trying to accelerate suitable energy, not crush competitors.”
It is unclear which type of batteries Tesla will supply.
The company currently runs a battery joint venture with Panasonic Corp.
Tesla also sources batteries from China’s Contemporary Amperex Technology and South Korea’s LG Chem.
The firm is also planning to build its own battery manufacturing facility in California at its Fremont plant under the “roadrunner” project.
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