It's been confirmed that this was actually a fire in the battery pack (one of the 16 cells of the pack). However, the fire did not start spontaneously - it was caused by the driver hitting a large piece of metal debris in the road. The fire was also contained to part of the battery pack and did not cause a runaway reaction like in some laptop battery fires. The driver was alerted by the computer system and could stop the vehicle in a controlled manner, and evacuate. There was no explosion, and the fire did not spread to the interior of the vehicle. The fire department was able to put out the fire with a single truck.<p>All in all, I think this is actually a positive mark on the engineering of the Tesla Model S. Statistically, there have been fewer fatalities with Model S than the average for the number of miles driven - this is in line with the car's crash test ratings. This is also the first fire after the 12 crashes which have been recorded. A fire like this was inevitable; gasoline cars also occasionally catch fire when they crash. The energy content of a full gas tank is also a lot higher.<p>However, investors are very fickle when it comes to Li-ion battery pack fires. Even if this is evidence that the Model S is probably safer with regards to fires than a traditional gasoline car, naywayers will jump on it. Not a fun day to be a Tesla shareholder :P
The fire has little to do with it. The stock is down because earlier this week it was priced at 100x Tesla's earning estimates for next year, and implies a 30x growth in sales by 2020.<p>Simply put, while Tesla's fundamentals are strong, there's a bubble in the stock. Retail investors (e.g. us) have been excitedly buying it without taking a careful look at the stock, and several institutional investors have decided it's a good time to sell and reap the rewards (i.e. fleece the excitable retail investors).<p>Here's a CNN Money article about Bank of America's sudden bearward turn on Tesla: <a href="http://money.cnn.com/2013/10/01/investing/tesla-investors/index.html" rel="nofollow">http://money.cnn.com/2013/10/01/investing/tesla-investors/in...</a><p>The Baird Capital report is a little more nuanced; it boils down to "Tesla have been kicking ass, and that's already priced into stock, so don't buy it now because everyone else is buying it":
<a href="http://www.forbes.com/sites/chuckjones/2013/10/02/tesla-downgraded-by-baird-since-stock-reflects-flawless-execution/" rel="nofollow">http://www.forbes.com/sites/chuckjones/2013/10/02/tesla-down...</a><p>Anyway, yes, this isn't anything wrong with Tesla, it's just a natural market correction.
To quote Ian Wright (co-founder of Tesla) "There have been five laptop fires so far, and it's front-page news. There are 750 gas-car fires each day, but that's not news."<p>Here's a picture of a SUV on the top of a Tesla Roadster, and it didn't begin to burn<p><a href="http://www.flickr.com/photos/16822508@N05/3995784846/sizes/l/" rel="nofollow">http://www.flickr.com/photos/16822508@N05/3995784846/sizes/l...</a>
This sort of thing happens all the time with high-end cars without any external factors like hitting debris.<p>Lamborghini - <a href="http://editorial.autos.msn.com/blogs/autosblogpost.aspx?post=21bc5c89-5753-4491-b871-52bdadf9a677" rel="nofollow">http://editorial.autos.msn.com/blogs/autosblogpost.aspx?post...</a><p>Ferrari - <a href="http://www.autoblog.com/2010/09/01/ferrari-458-italia-recalled-fire-risk/" rel="nofollow">http://www.autoblog.com/2010/09/01/ferrari-458-italia-recall...</a>
Well, there's bound to be issues in what's essentially the full 1.0 model of Tesla's car product (let's be honest, the Roadster was an extended beta).<p>I live in an area that manifests overall economics in the form of cars (there's a Maserati, Ferrari and Porsche dealer all within 10-15 minutes of my house . When the housing bubble was booming, ~$100,000 cars were <i>everywhere</i>. I remember seeing so many Porsche products on the road I thought that there must be a North American Porsche factory nearby -- I would literally see at least one at every stoplight<p>When the economy took a downturn, all those cars disappeared and were replaced by more "practical" cars. For the last 2 or 3 years I might see a Porsche once a week.<p>All of a sudden, in the past year things are starting to return to the old ways, except instead of Porsche products I see Teslas <i>everywhere</i>. I was expecting Teslas to be like the odd Lamborghini I see once a month or so. But no, I see at least one every day of the week, and I work at home. They seem to have hit the magic combination of great product and a growing economy - which is what's needed when you enter the market with luxury vehicles and work down.<p>I'm absolutely not concerned about the current future of Tesla, their cars are selling like hotcakes right now, and I bet the Model X will sell like wildfire with the stay at home coffee shop visiting yoga pants wearing stylish soccer mom demographic that seems to make up 90% of my neighborhood. I fully expect to see at least one Model X on every block in my neighborhood...after all, when times were booming, there was a Cayenne on every block.
I knew something like this would happen and send the stock tumbling. I bought in at ~18 and got out at ~150 with the intention to buy back in if it ever fell significantly. I assumed this would happen.<p>BTW, I am a huge fan or tesla and bought in originally because I believe in what they are doing, but the gains got too be too much to not lock in. I'd be buying back since I still believe that they are the future and the most forward looking car company at the moment. The big car companies are going to keep showing up at Tesla's door for access to their tech and know-how, and it's going to cost them.
The way to make money is to buy when blood is running in the streets. - The fourth Baron Rothschild.<p>This is news because it's the first time it's happened, to a new technology. Had I a brokerage account I would be buying.
"Shares of Tesla Motors Inc. fell $12.05 to $180.95 — the stock's biggest one-day decline since July 16."<p>Wow, the entire value of the last 14 days worth of growth was wiped out in a day. It's not a "tumble", it's a full-on bloodbath!
Meanwhile, hundreds of gas-powered vehicles <i>also</i> catch fire when colliding, but nobody bats an eye... <a href="https://www.google.com/search?q=vehicle+catch+fire&num=100&es_sm=93&biw=1255&bih=760&sa=X&ei=0KlNUvW6HabliwL6hoGYAQ&ved=0CCEQpwUoBg&source=lnt&tbs=cdr%3A1%2Ccd_min%3A1%2F1%2F2013%2Ccd_max%3A9%2F30%2F2013&tbm=nws" rel="nofollow">https://www.google.com/search?q=vehicle+catch+fire&num=100&e...</a>
Stock holders are so irrational.
Yes, Tesla is a car. Never heard of any other car companies losing such a massive amount market capital due to one accident...hell, even the passengers were safe AND the fire was contained to the battery bay. I've seen cars that burn to the ground despite the firewall.<p>If anything, I have a more positive look on Tesla's now than I did before.
Ok I read it quickly, but it seems like the fire was in the Frunk and the batteries are under the cabin. That makes it seem like it's just a normal electrical fire - probably from something getting shorted after he drove over 'metal debris' - and not anything specific to the batteries. If that's correct this is unfortunate for Tesla as even gasoline cars (and certainly hybrids) can have an electrical fire after hitting something.<p>Either way it was bound to happen eventually.
It would be really interesting to see what penetrated the battery, although it sounds like we probably won't. When determining the safety of a vehicle one of the things that is not looked at AFAIK by the NHTSA is how the vehicle deals with, for example, exhaust system debris coming up into the engine compartment, floor, fuel tank, etc.<p>At the risk of being overly contrarian: it's possible this debris would have done something much worse if a Honda Civic or something had hit it. There is not enough data to draw a conclusion on that, let alone make a statistical comparison between vehicles.
I've had two cars catch fire: 1974 Land Rover Series III, 2006 Fiat Doblo Active. The first was an electrical fire and the second was a diesel leak (diesel burns like fuck when it gets hot).<p>This isn't unique to Tesla! I'd rather drive a Tesla but they're too small for me and too expensive.
Wonder if Boeing will Reciprocate the offer to help them figure it out. If I were Boeing's PR person and felt a tad cheeky this morning I just might.
"Shares of Tesla Motors Inc. fell $12.05 to $180.95 — the stock's biggest one-day decline since July 16."<p>Wow, that's the biggest drop two and a half months. Truly the end is in sight for Tesla.
Accidents with new technology are reported disproportionately to accident with old technology. Probably a good opportunity for contrarian investors (although they may be a little burned from the 400% stock price increase this year...)
It will be interesting to watch the market react to this.<p>This is important not because of Tesla, but because the auto-drive car makers are going to have an even bigger hurdle deploying auto-drive. Yep, there will still be crashes, and it remains to be seen how the news media will run with these types of stories -- explaining the context, or piling on. My bet is that initially they'll explain the context, but just like everything else they cover, eventually they'll go for video of flaming orphans over telling the larger story of how much good is being done. Here's hoping I'm wrong.
I went to a Tesla owners group meetup a few months back. It turned out that although they loved their new cars, every one of them had problems with their Model Ss that required a trip back to the dealer.
The truth of the matter is these are the tests electric cars will have to endure over a period of time in order to reach wide adoption. Despite what's been said here a full tank of gasoline is far safer than a fully charged battery pack with enough energy to go 300 miles. Before anyone mauls me, consider how many gasoline cars have been driven and, yes, crashed, world-wide since gasoline cars came into mass production. There have probably been millions of accidents without fires, even with fuel leaks. There's probably no imaginable way to compare the two at this time. We simply don't have enough data. And, no, linking to a horrible crash video on youtube involving gasoline igniting does absolutley nothing to support arguments on either side.<p>The one issue with electrics that is not spoken of is the fact that you have a several hundred volt high energy system that could very well electrocute passengers. I fully expect that to happen one day (in general, not necessarily Tesla). If and when that happens you can bet it will set the breaks on electrics for a while and relevant stocks will plummet.<p>I still believe electric cars are the future. We simply need to go though the evolutionary process that will make them really safe for hundreds of millions of electrics to share the road. What happens when you have a pile-up of ten or twenty electric cars on a fogg-covered highway? A pile of mangled wrecks with 400 Volt high energy systems is unimaginably dangerous. I can think of a few horrific scenarios under those conditions.<p>At some level part of me thinks that fuel cells are the future, not batteries. Having something relatively benign that can leak out would be a good thing.
Probably worth buying the shares now then... I mean if we consider the amount of combustion engines that caught on fire in history... You get my point.
Perspective: <a href="http://stockcharts.com/h-sc/ui?s=TSLA&p=D&yr=3&mn=0&dy=0&id=p54222571534" rel="nofollow">http://stockcharts.com/h-sc/ui?s=TSLA&p=D&yr=3&mn=0&dy=0&id=...</a><p>TSLA has been on a moonshot, it is "tumbling" all the way back to September prices.
And I thought SpaceX was the dangerous company here. Maybe Tesla will be the first of Elon Musk's companies causing a disastrous accident.<p>Innovation and quick iterations are great for R&D but come with a price when released on the market too soon. That's why I put my money on Orbital and the other dinosaurs instead.
I don't think "tumbles" accurately describes "declines to the price it was two weeks ago", particularly since no one used the word "skyrockets" for the last two weeks' rise (it didn't), or some similarly exciting terminology.
It baffles me how somebody willing to buy TSLA would become scared so easily. I don't pretend to understand markets so could anyone explain how such behavior is possible?
12 Tesla crashes. 1 fire. The fire was contained, the driver was alerted, and the car was stopped safety and evacuated. If I had money I would buy Tesla stock. And a Tesla.
I am sure it is easier said than done, but it seems like the batteries simply need to be better protected. Something like a carbon fiber or titanium under shield.