Third Tesla Model S Fire Raises Red Flag for Electric Carmaker

Tes­la Motors had its third Mod­el S fire in five weeks on Wednes­day, Nov. 6, near Smyr­na, Tenn. It’s a stun­ning blow to the upstart lux­u­ry, high-per­for­mance elec­tric car­mak­er; it illus­trates the inten­sive dif­fi­cul­ties of bring­ing a new tech­nol­o­gy to mar­ket and suc­ceed­ing in the auto indus­try.

The Ten­nessee High­way Patrol said that the 2013 Mod­el S ran over a tow hitch on Inter­state 24 that hit the under­car­riage of the vehi­cle, caus­ing an elec­tric fire. Tes­la doesn’t know yet whether the fire involved the elec­tric car’s bat­tery.

The first fire took place on Octo­ber 1 in Kent, Wash., near Seat­tle. The Mod­el S is said to have run over a piece of road debris described as a “curved sec­tion that fell off a semi-trail­er.” Tes­la said that it punched a three-inch hole through the quar­ter-inch-thick armor plate pro­tect­ing the pack and had a force of 25 tons. The Mod­el S alert­ed the dri­ver, and he pulled over and safe­ly exit­ed the car. The sec­ond fire took place on Octo­ber 18 in Méri­da, a city in Mexico’s Yucatán region. A drunk dri­ver jumped a curb, took out part of a con­crete wall and hit a tree. This dri­ver was also sat­is­fied with the safe­ty of the car and wants to have his replace­ment Mod­el S deliv­ered prompt­ly.

The Nation­al High­way Traf­fic Safe­ty Admin­is­tra­tion (NHTSA) is in talks with Tes­la on the Ten­nessee crash, and will decide soon if a full inves­ti­ga­tion is need­ed. Tes­la did receive a top NHTSA safe­ty rat­ing for the Mod­el S this year, and acco­lades also came in from Con­sumer Reports and car review pub­li­ca­tions. While thou­sands of cars crash and burn every year in the US, tim­ing does play a huge part in the stock price of a com­pa­ny and per­ceived val­ue of a prod­uct. There have been about 20,000 units sold so far for the Mod­el S; while it’s prob­a­bly not a ratio that should raise red flags over the elec­tric car’s safe­ty, hav­ing these inci­dents hap­pen so close togeth­er does cre­ate quite a chal­lenge for the automak­er.

Tes­la Motors is now under a spot­light sim­i­lar to what the Chevro­let Volt and Fisker Kar­ma and its A123 lithi­um ion bat­tery pack have been through. Li-ion bat­ter­ies are com­mon­place in smart­phones and lap­tops, but are still fair­ly new to cars. While Toy­ota and Daim­ler are impressed enough with Tesla’s bat­tery-pow­ered elec­tric motor to place them in their own EVs, the new tech­nol­o­gy is quite vul­ner­a­ble to safe­ty and reli­a­bil­i­ty issues.

This year has been a wild ride for the lux­u­ry elec­tric car­mak­er. Tes­la CEO Elon Musk has become a media icon, much to the cha­grin of auto deal­er trade groups, which have locked horns with Tes­la in Texas and oth­er states through law­suits and lob­by­ing efforts. Tes­la has opened retail stores in states where fran­chise laws dic­tate car sales. Deal­ers are con­cerned that if Tes­la wins this fight, automak­ers may bypass at least some of their deal­er net­works and go direct to con­sumers.

Musk has gained much atten­tion through his SpaceX com­mer­cial space trans­port com­pa­ny, and the Hyper­loop 800-mile per hour train sys­tem that he con­ceived with SpaceX engi­neers. Investors have also been quite enam­ored with Musk and Tes­la shares, which have peaked and plum­met­ed this year. In May, Tes­la stock (TSLA) was at about $76 per share; it reached a peak of $193.37 in late Sep­tem­ber and closed on Fri­day, Nov. 8, at $137.95. So far, Tes­la has been very shrewd about how it’s respond­ed to the crash­es, but the com­pa­ny is at a piv­otal junc­ture for its future.


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