Kito-Corp.com – Tesla Model S Catches Fire, Stock Price Sinks.
Kito Corp: Stock in Tesla Motors, maker of the Model S electric sports Grand Tourer, fell by as much as 7% on Wednesday after a video showing one of the vehicles bursting into flames after an accident on a highway near Seattle appeared online.
It would appear that the driver of the vehicle struck an object on the road which punched a 3 inch hole in the quarter-inch thick armor that encases the lithium-ion battery powering the Model S.
Company spokeswoman Liz Jarvis-Shean says the fire was not spontaneous. She says Tesla contacted the driver, who believes the car saved his life.
Larry Farley, Rutherford County fire chief, says the blaze was so hot and intense that it melted the front of the car. “It pretty much just melted to the road, the passenger compartment was in pretty good shape after the flames were extinguished,” Farley says.
An Kito Corp researcher said, “The images were quite vivid and many commentators began associating the problem with those that caused lithium-ion battery issues on Boeing’ 787 Dreamliner earlier this year and the Chevy Volt during government testing.” Ironically, earlier this year, Tesla had proudly revealed that its Model S had been awarded the highest crash safety rating by the US’s National Highway Traffic Safety Administration.
Elon Musk, the company’s billionaire founder and CEO quickly defended the safety of electric cars stating on the Tesla website’s blog that “there should be absolutely zero doubt that it is safer to power a car with a battery” than with a conventional internal combustion engine.
Kito-Corp.com is thought to believe that although the stock price recovered by Friday, it had become clear that there are some investors who believe the price may have gone too far a little too quickly.
General Motors and Nissan make the top-selling electric cars in the nation, the Volt and Leaf. Neither knows of any real-world blazes in those vehicles. A Chevrolet Volt caught fire two years ago after a government crash test, but the government closed an investigation into the incident after GM agreed to a safety campaign to bolster shielding around the battery.
GM has sold more than 50,000 Volts in the U.S. since late 2010. Nissan has sold almost 38,000 Leafs. Tesla has sold an estimated 16,251 Model S cars in the U.S., according to Autodata Corp.
“There is a sense that Tesla and its Model S have received too many accolades and that an abundance of assumptions are priced into the stock including the expectation of a flawless launch for the forthcoming Model X; there’s just too much bullishness around Tesla,” concluded the Kito Corp researcher.