Tesla is recalling roughly 10,500 units of its Powerwall 2 home battery after U.S. safety regulators warned that a defect could cause overheating and, in some cases, lead to smoke or fire.
According to a notice published Thursday by the U.S. Consumer Product Safety Commission, the lithium-ion cells in certain Powerwall 2 systems can fail during normal use. The malfunction can cause the unit to shut down and potentially overheat, posing a risk of “smoke or flame” and creating “fire and burn hazards” that could lead to serious injury or death.
Tesla attributed the problem to a “third-party battery cell defect” but did not identify the supplier. The company has received 22 reports of overheating and five instances where the issue led to fires that caused minor property damage. No injuries have been reported.
The Powerwall is one of Tesla’s core energy products, typically paired with the company’s rooftop solar systems to store electricity for later use or during outages. The recall does not affect the newer Powerwall 3 model, Tesla said in a separate notice on its website, adding that all impacted units will be replaced free of charge.
Tesla’s energy division has become a major growth driver for the company. In the third quarter of 2025, energy revenue surged 44% to $3.42 billion, accounting for about one-quarter of Tesla’s total revenue as of September.
Tesla shares dropped more than 7% on Thursday following the recall announcement. The company did not respond to requests for comment.