Quick overview

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Tesla’s stock declined after being sued over allegations of creating a “death trap” by preventing three college students from escaping a burning Cybertruck before they died from smoke inhalation due to door flaws. On October 3, 2025, Tesla fell 3.2%, closing at $436 after opening at $470. This drop reduced Tesla’s valuation to roughly $1.37 billion.

 

The accusations stem from a late-night crash on a residential street in the Piedmont suburb of San Francisco in November 2024. A passenger in the Cybertruck was rescued, but the other three remained trapped inside.

A Bloomberg News investigation uncovered several incidents where people were killed or seriously injured after being unable to open doors following a power outage, especially after crashes, drawing attention to Tesla’s door handles.

Over 140 customer complaints have been filed with the National Highway Traffic Safety Administration about Tesla doors being stuck or refusing to open since 2018.

Tesla’s CEO, Elon Musk, has often called the company’s vehicles the safest on the market. However, the company faces an increasing number of lawsuits claiming its technology causes deadly collisions. Some lawsuits cite post-crash entrapment, while others allege flaws in Autopilot driver-assistance software.

Tesla was victorious in two Autopilot cases that went to trial in 2023. A Miami jury found the company partially liable for a 2019 Model S collision with a parked car in the Florida Keys that killed a woman and seriously injured her boyfriend, awarding $243 million in damages in July. This marked the company’s first major setback. Tesla has also settled several other cases confidentially before trials.