EUROPE'S biggest taxi firm has suspended Elon Musk's Model 3 Teslas after a crash killed one person and injured 20.

The horror unfolded after an off-duty taxi driver lost control of his Tesla while taking his family to a restaurant in Paris on Saturday night.

Prosecutors in the French capital have opened an investigation after one person was killed and seven were left seriously injured in the smash.

The G7 taxi company – which claims to be the biggest firm in Europe – has halted the use of the 37 Model 3 Teslas in its fleet until the investigation is finished.

After checking the crashed car’s data remotely, Tesla denied there was any technical issues with the vehicle.

France's transport minister, Jean-Baptiste Djebbari, also said there was no suggestion at this stage that the fatal crash was caused by a technical fault.

He told RMC radio: "There are no elements that would lead one to believe it was tied to a technical problem."

The minister said he has spoken with the chief executive of Tesla Europe, who told him there had been no safety alerts about the model.

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G7 boss Yann Ricordel said the crash happened while the taxi driver was taking his family to a restaurant.

He said the driver tried to brake but the car accelerated instead.

A police source told Reuters the car had stopped at a red traffic light before it suddenly sped forward, hitting and dragging a cyclist who later died.

The source said the driver tried to stop the car by steering into bins on the street, causing further damage.

It's not clear whether the car was operating in autopilot mode, and the driver tested negative in a alcohol test, the police source said.

Horror footage of the scene showed the wreckage of a black Tesla and debris strewn across the street.

The vehicle's left-hand side was crumpled, the front left wheel collapsed and the windscreen shattered.

The car appeared to have crashed into a white van, which suffered front-end damage.

Other footage showed members of the public rushing to helped those injured after the crash.

Tesla collects detailed data from the sensors and cameras on its vehicles and has used the data in the past to challenge claims that accidents were caused by malfunctioning technology.

The company it would share all details with French authorities if requested.

G7 is one of Paris' biggest taxi companies, with 9,000 affiliated drivers – independent operators who own their vehicles.

Half of the G7 fleet are electric or hybrid vehicles and the company aims to have a 100 per cent green fleet by 2027.

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