Tesla (NASDAQ: TSLA) is confronting a series of escalating challenges, including the sudden departure of its top accounting controller and new concerns about potential conflicts of interest at the federal agency regulating its self-driving technology.
The company’s director of accounting controllership, Harsh Rungta, has left the company shortly before the release of the automaker’s first-quarter financial results. He confirmed his new position as Senior Vice President of Finance and Chief Accounting Officer at Archer Aviation, an eVTOL aircraft manufacturer that has recently attracted talent from Tesla. Rungta had been at Tesla for more than six years, rising through the ranks after initially coming from PricewaterhouseCoopers, the company’s independent registered public accounting firm.
“My responsibilities included overseeing corporate accounting, financial statements, and quarterly financial close processes,” Rungta wrote of his Tesla experience on his LinkedIn profile. Observers note that his exit comes in the wake of CFO Zachary Kirkhorn’s departure and with no clear successor for Tesla’s top accounting role.
Adding to the challenges, the automaker is now the focal point of calls for an investigation into alleged conflicts of interest involving Elon Musk and the US Department of Transportation. Two House Democrats have formally asked the department’s ethics office to look into whether Musk’s advisory role under former President Donald Trump might unduly influence the National Highway Traffic Safety Administration.
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Reports have surfaced that Musk’s so-called Department of Government Efficiency initiated job cuts at the NHTSA that disproportionately affected the office tasked with evaluating advanced driver-assistance technologies.
“There is a clear conflict of interest in allowing someone with a business interest influence over appointments and policy at the agency regulating them,” a former senior NHTSA figure said.
This ensues under the shadow of intense government scrutiny on Tesla’s autonomous driving technology. The NHTSA currently has multiple open investigations into the company’s Autopilot and Full Self-Driving features, some triggered by complaints about sudden braking or unprompted acceleration. One complaint from mid-October 2024 detailed a Model 3’s abrupt halt that nearly caused a rear-end collision, prompting the driver to label the software “far from being ready to be safely used.”
In Canada, Tesla is also facing questions over what some allege was an effort to claim millions of dollars in rebates just days before the country’s federal EV incentive program expired. Tesla has pushed back, insisting the sudden spike in filings was due to “backlogged applications” rather than any attempt to bypass the system.
Yet some dealers in the country say the final batch of rebates unfairly went to Tesla at their expense.
Meanwhile, competition in the EV sector is intensifying globally. The EU recently entered negotiations with China over potentially lowering tariffs on Chinese EVs, a move that could pave the way for increased competition from Asian automakers at a time when Tesla is already fielding multiple challenges. The move is also seen as a repercussion of the increasingly tense trade environment in the aftermath of Trump’s wave of tariffs.
Information for this story was found via Financial Times, Electrek, and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
