Tesla Model S Safety Defended, But Stocks Still Plunge

Tesla’s fame as America’s first independent and wholly electric car manufacturer hit a snag last week. Stocks plummeted on NASDAQ last Wednesday after news broke that there had been a third car fire in less than two months, this time during rush hour traffic in central Tennessee.

The company has seen a bumpy but encouraging rise in stock prices over the past four months, largely due to its increasing sales and notoriety in California. After the National Highway Traffic Safety Administration (NHTSA) awarded the Model S its highest safety rating in August, the California Environmental Protection Agency’s Resource Board reported in October that Tesla had topped the list for zero-emission vehicle credits with sales that far exceeded any other vehicle manufacturer registered in California.

However, last week's news that the NHTSA was debating whether to investigate the third fire contributed to the fall. By the time NASDAQ had closed on Friday, Tesla’s stocks had dropped from 176.81 on November 5 to 137.95 at Friday's close.

According to the driver, Juris Shibayama of Murfreesboro TN, he first became aware that there was a problem with his Model S about a minute after he inadvertently ran over an abandoned trailer hitch on the interstate while traveling at about 70 miles-per-hour. In his account on Tesla’s blog, Shibayama makes it clear that he felt the car performed just as it should have after the impact.

“About 30-45 seconds later, there was a warning on the dashboard display saying, "Car needs service. Car may not restart.” Shibayama said he continued to drive in the hope of getting home but about a minute later another message appeared on the dashboard, this time telling him to stop the car. “‘Please pull over safely. Car is shutting down.’ I was able to fully control the car the entire time and safely pulled off the left shoulder on the side of the road,” Shibayama said.

It was later revealed that the abandoned hitch had punctured a hole in the armored plating that protects the car’s battery packs, resulting in a fire in the front part of the car. However, Shibayama insists that because of the safety measures on the car, he was able to get out and walk away safely before the fire started.

“While driving after I hit the object until I pulled over, the car performed perfectly, and it was a totally controlled situation. There was never a point at which I was anywhere even close to any flames.”

Both the first and the third fire occurred after the car rolled over a large metal object that was able to puncture the bottom of the car. In the first instance, just outside of Seattle, Wash. on Oct. 1, the driver ran over metal debris that also punctured the casing on the battery pack. The second fire occurred after the driver collided with a roundabout. All of the drivers were able to walk away from the accidents.

It is unclear what long-term impact the fires will have on Tesla’s early gains as a leader in the electronic car market, but Reuters notes that fires have occurred in Mitsubishi and GM electric cars, as well. In some cases, strengthening the casing around the battery packs is said to have remedied the problem. Tesla says that it is currently looking at the design to see what changes can be made to its structure.

As for the unfortunate drivers in the three Tesla fires: according to Reuters, all three were unfazed by the accidents, and all three have requested replacement cars from the auto manufacturer.

“This experience does not in any way make me think that the Tesla Model S is an unsafe car. I would buy another one in a heartbeat,” said Shibayama.

Image courtesy of Al Abut