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UPDATE 3-Tesla, NTSB clash over Autopilot investigation

(Recasts with Tesla criticism of the NTSB)

WASHINGTON, April 12 (Reuters) - Tesla Inc lashed out at the National Transportation Safety Board on Thursday after the agency took the unusual step of removing the automaker as a party to its investigation of a fatal crash in March in which a Tesla vehicle's "Autopilot" system was in use.

The war of words on Thursday between the Silicon Valley automaker run by billionaire Elon Musk and the NTSB stood in sharp contrast to efforts this week by Uber Technologies Inc Chief Executive Dara Khosrowshahi and Facebook chief Mark Zuckerberg to defuse conflicts with regulators.

The NTSB's action means Tesla may not get access to some information obtained by the agency's investigators before it is made public, but frees the company to vigorously defend the Autopilot technology.

Tesla "violated the party agreement by releasing investigative information before it was vetted and confirmed by the NTSB," the safety board said. Releasing incomplete information often leads "to speculation and incorrect assumptions about the probable cause of a crash, which does a disservice to the investigative process and the traveling public," the agency said.

Tesla in return blasted the NTSB, saying the company chose on Tuesday to withdraw from the agreement as a formal party before the agency revoked its status.

Tesla said it had "been clear in our conversations with the NTSB that theyre more concerned with press headlines than actually promoting safety" and accused the agency of violating its own rules while trying to prevent Tesla from disclosing all the facts.

"We dont believe this is right and we will be making an official complaint to Congress," Tesla added, saying it would make an open records request to "understand the reasoning behind their focus on the safest cars in America while they ignore the cars that are the least safe."

NTSB spokesman Christopher O'Neil said the agency had no additional comment.

The NTSB has three pending probes into Tesla crashes.

Tesla's initial statement announcing its withdrawal did not disclose that the NTSB was revoking its status.

Driver Walter Huang died after a March 23 crash and vehicle fire in a Tesla Inc Model X near Mountain View, California, prompting investigations by the NTSB and the National Highway Traffic Safety Administration.

Tesla's announcement late on Wednesday in California came after the company publicly blamed the driver for the crash and made statements about the incident that drew criticism from the NTSB.

Autopilot is a semi-autonomous system that handles some driving tasks. Tesla has said it warns drivers that they are always responsible for the safe operation of the vehicle.

AUTOPILOT

NTSB Chairman Robert Sumwalt told Reuters on Tuesday the NTSB had a good working relationship with Tesla but that companies must follow the rules. He and Musk spoke on Friday and again on Wednesday when he told the company it was revoking its status.

"It is unfortunate that Tesla, by its actions, did not abide by the party agreement," Sumwalt said in a statement on Thursday.

Tesla said that "even though we won't be a formal party, we will continue to provide technical assistance to the NTSB."

Huang's family said on Wednesday it had hired law firm Minami Tamaki LLP to explore legal options, adding the firm believed the Autopilot feature probably caused his death. The firm said its preliminary review of the crash suggested Autopilot was defective.

The NTSB has not disclosed any findings.

Tesla has said Huang had activated Autopilot and it was in operation at the time of the crash. Vehicle logs from the accident showed no action was taken by Huang before the crash and that he had received warnings from the system to put his hands on the wheel, the company said.

Tesla said the Autopilot system always reminded drivers to be alert and keep their hands on the wheel.

The NTSB confirmed earlier this week it had two other pending investigations of Tesla crashes, including an August 2017 Tesla battery fire in Lake Forest, California, after an owner lost control and ran the vehicle into his garage. The investigation into that fire was first reported by Reuters on Wednesday.

The agency previously faulted Tesla in a 2016 fatal crash in Florida in which Autopilot was engaged. Sumwalt said in 2017 that "system safeguards were lacking" and "Tesla allowed the driver to use the system outside of the environment for which it was designed and the system gave far too much leeway to the driver to divert his attention." Tesla said it had made improvements in the system since the crash. (Reporting by David Shepardson; Editing by Bernadette Baum and Peter Cooney)