Tesla share value plunges after video of Model S fire surfaces

By on October 3, 2013, 8:00 AM

Share value in Tesla Motors dropped more than six percent on Wednesday after a video hit the web showing a Model S sedan engulfed in flames. The driver ran over a large metallic object which caused extensive damage to the front of the car according to a statement from the company.

The video and accompanying photos were first published on automotive blog Jalopnik. The accident took place around 8 a.m. on Tuesday as the driver was traveling on state Route 167 near Seattle according to Washington State Trooper Chris Webb.

The driver said the car’s alert system instructed him to pull over so he got off the highway. Soon after, he started to smell something burning and then noticed the vehicle was on fire shortly after. The trooper said he was unable to find any debris on the road.

Fortunately, nobody was injured in the accident. Firefighters reportedly found it difficult to put out the blaze and the damage from the fire made it difficult to locate where the object struck the vehicle. The vehicle was towed away after the fire was extinguished, Webb said.

Tesla noted the fire was contained to the front portion of the sedan due to its design and construction and all indications suggest the fire never entered the interior cabin.

Share value closed at $180.95 on the day which is the biggest single-day decline since July. It’s since dropped another 1.33 percent in after-hours trading but considering share value is up more than 400 percent on the year, it’s unlikely the incident will have any serious impact.




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1 person liked this | 9Nails, TechSpot Paladin, said:

Tesla's stock has had a really good year, and that fiery model s car got the highest safety rating in the government crash test. The driver may have had a front end collision rupturing one of the batteries, but was able to walk away. Their cars have been selling well, better than any other luxury car manufacturer. It might be a little stock market deflation, but I don't think this spells doom and gloom for the company.

madboyv1, TechSpot Paladin, said:

If a video/report of a single accident that involved fire, one which reportedly never entered the cabin of the vehicle due to the car's design, is able to have such an immediate economic effect on a company... How is Porche and Toyota still in business???

treeski treeski said:

Tesla noted the fire was contained to the front portion of the sedan due to its design and construction and all indications suggest the fire never entered the interior cabin.

... well that's pretty cool, if true. If I could afford a Tesla... yeah I'd probably buy one.

cmbjive said:

If a video/report of a single accident that involved fire, one which reportedly never entered the cabin of the vehicle due to the car's design, is able to have such an immediate economic effect on a company... How is Porche and Toyota still in business???

Because when you run over things in those cars it doesn't generally begin to blow up. I drive a Mitsu Lancer and drove over all kinds of things, including some *****'s aluminum ladder on the highway. The car kept on going and it didn't catch fire.

Firefighters reportedly found it difficult to put out the blaze and the damage from the fire made it difficult to locate where the object struck the vehicle

Yeah, electrical fires are some of the most difficult fires to put out. There's no such thing as a "green car."

wastedkill said:

This is pathetic "The driver ran over a large metallic object which caused extensive damage to the front of the car" so because the driver was stupid and thought the car was invisible the shareholders are like "omg this car is not invincible like all cars lets sell the shares"

Atleast the re tarded shareholders are out dont want them 10IQ shareholders driving them cars as well they will drive it in the ocean or the sea and say "its not a submarine wtf this is bull lets post a video so others know its not a submarine"

2 people like this | Guest said:

WastedKill,

I couldn't agree more. You can engineer a beautiful car but you can't ***** proof everything; I almost wish the fire entered the cabin so Darwinism could have gotten rid of the genius who smashed his/her Tesla.

As for the share holders good riddance, people selling their stocks are only worried about their profits and not the success of a great company.

cmbjive said:

@wastedkill and Guest, why are you guys so quick to buy the notion that the driver struck debris in the road? The report says a trooper could not find any debris in the road and that the fire made it difficult to find the area where the alleged debris struck the car. And if it was debris in the road how is that the fault of the driver? When you're driving at sixty miles an hour trying to dodge debris in the road is very hard to do, especially it is about twenty to thirty feet away from the car.

I'm pretty sure Tesla is going to take the car and rip it apart to find out what happened. Until then let's hold off on making any assertions either way.

wastedkill said:

@wastedkill and Guest, why are you guys so quick to buy the notion that the driver struck debris in the road? The report says a trooper could not find any debris in the road and that the fire made it difficult to find the area where the alleged debris struck the car. And if it was debris in the road how is that the fault of the driver? When you're driving at sixty miles an hour trying to dodge debris in the road is very hard to do, especially it is about twenty to thirty feet away from the car.

I'm pretty sure Tesla is going to take the car and rip it apart to find out what happened. Until then let's hold off on making any assertions either way.

I'm not saying that I'm simply saying its truely stupid to sell your shares after a video goes viral about a product its like going mentally ill and stating you made the bible and got told you to do it.

Sure it could have the car falling apart after all those crash tests the government did but hey who is to say the guy didnt just hit a ghost thats why the earth is falling apart.

lol but tbh you'd think debris would be something the government try to test on the highest scoring car for safety.

cmbjive said:

@wastedkill and Guest, why are you guys so quick to buy the notion that the driver struck debris in the road? The report says a trooper could not find any debris in the road and that the fire made it difficult to find the area where the alleged debris struck the car. And if it was debris in the road how is that the fault of the driver? When you're driving at sixty miles an hour trying to dodge debris in the road is very hard to do, especially it is about twenty to thirty feet away from the car.

I'm pretty sure Tesla is going to take the car and rip it apart to find out what happened. Until then let's hold off on making any assertions either way.

I'm not saying that I'm simply saying its truely stupid to sell your shares after a video goes viral about a product its like going mentally ill and stating you made the bible and got told you to do it.

Sure it could have the car falling apart after all those crash tests the government did but hey who is to say the guy didnt just hit a ghost thats why the earth is falling apart.

lol but tbh you'd think debris would be something the government try to test on the highest scoring car for safety.

Have you ever seen a battery explode on its own? It happens, doesn't it? In fact, that's what Tesla is saying:

[link]

So either the debris punctured the battery or, worse for Tesla, the battery pack exploded on its own. Li-ion batteries generate an extraordinary amount of heat when they are under extreme load.

And here's why electrical fires are some of the worse to fight. From the article:

The firefighters said that shortly after they arrived, they thought the fire had been extinguished, only to have it reignite under the vehicle. The fire department official, Capt. Kyle Ohashi, said on Wednesday that the battery pack proved difficult to extinguish.

1 person liked this | davislane1 davislane1 said:

I'm not saying that I'm simply saying its truely stupid to sell your shares after a video goes viral about a product its like going mentally ill and stating you made the bible and got told you to do it.

It's only "stupid" if you dump your entire position on the news. Most long term investors aren't going to offload shares on news like this; short-term traders simply sell their longs or open shorts, pushing down the price. All very acceptable decisions when done properly.

As for the share holders good riddance, people selling their stocks are only worried about their profits and not the success of a great company.

Care to elaborate how the success (see: profits) of the company isn't also the success of its shareholders? Long-term investors aren't going to liquidate major portions in Tesla on trivial news. If anything, most marginal investors will simply "buy the dip." This sell off has to do with short-term market speculation. Bad publicity leads to fear among untrained/inexperienced market participants, so short-term traders who know what they're doing sell any longs and/or get short. Amateurs start selling once the price declines, "smart money" profits and long-term positions add a little on, once prices decline to a sufficient level.

MilwaukeeMike said:

This is pathetic "The driver ran over a large metallic object which caused extensive damage to the front of the car" so because the driver was stupid and thought the car was invisible the shareholders are like "omg this car is not invincible like all cars lets sell the shares"

Atleast the re tarded shareholders are out dont want them 10IQ shareholders driving them cars as well they will drive it in the ocean or the sea and say "its not a submarine wtf this is bull lets post a video so others know its not a submarine"

EVs are new territory. What happens if the battery caught fire after something small like a rock flew off the tire and just happened to hit the right spot. What happens if Tesla has to recall all it's cars to install a metal plate to better protect the battery? Then those investors who jumped ship look pretty smart.

I agree with @davislane1 though that this isn't going to slow down Tesla too much... but even Elon Musk has said he thinks the share price might be higher than it should. When even the CEO says it might overvalued it won't take much for people to sell it off for fear of it staying down for a while. Much like when Apple was at $700 a share 13 months ago and is now having trouble staying over $500.

Ranger1st Ranger1st said:

This is hilarious, the ford focus had electrical fires from battery issues so often it was rare NOT to see one on fire once a week.. oddly the only people who made big deals of this, were silenced pretty quickly by the feds and lawyers.

All this sell off is doing, is allowing those with actual brains to by more stock at a much reduced price..

Guest said:

In the words of nicepeter: "Not such a smart car is it smart guy?"

Lionvibez said:

I'm not saying that I'm simply saying its truely stupid to sell your shares after a video goes viral about a product its like going mentally ill and stating you made the bible and got told you to do it.

Sure it could have the car falling apart after all those crash tests the government did but hey who is to say the guy didnt just hit a ghost thats why the earth is falling apart.

lol but tbh you'd think debris would be something the government try to test on the highest scoring car for safety.

Totally agree.

And its the reason I would never never never ever have a publicly traded company.

I would rather close down my business!

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