Recent news about Tesla cars bursting into flames as well as the recent Tesla Model 3 crash which resulted in the death of one person had damaged Tesla's shares as it falls to its lowest level in two and a half years. Can Tesla still survive?
Tesla shares fell earlier this week again to hit the lowest level in the last two and a half years. The 3.8 percent decline comes in at 11 percent of casualties, which began last Thursday and reached below $200 for the first time since December 2016. The general expectation is that they will remain at that level until the end of this week.
Tesla's shares drops came after an avalanche of bad news gained momentum: US officials ruled that the autopilot was activated in a recent Tesla Model 3 crash which resulted in the death of one person and three incidents of Tesla cars bursting into flames while doing none at all.
The first Tesla fire incident happens in Shanghai, wherein an older version of Tesla Model S spontaneously combusted while parked unused in a structure in Shanghai. A video of the incident went viral, which made the news bigger and caught the public's attention.
The second incident came just five days after in San Francisco, wherein the car was not charged or plugged in and was just parked. The Tesla car was completely destroyed by the fire. Fortunately, no one got hurt, and no building property was damaged.
The most recent Tesla fire happened in Hong Kong, where the vehicle had been parked for half an hour when it suddenly started to burst into flame. It took 45 minutes for firefighters to extinguish the fire completely.
These incidents are enough to raise doubts about Tesla's electric vehicles, which since 2013 have registered a total of fourteen fires and a number of road accidents. And although Tesla CEO, Elon Musk gave out a statement and affirm that the probability that one of their vehicles suffers a fire is ten times less than a gasoline car does, it doesn't seem to be working to his advantage as Tesla's stock continuously goes down.
Over a million combustion engine (it’s right there in the name!) car fires per year & thousands of deaths, but one Tesla car fire with no injuries gets biggest headlines. Why the double standard? This is a real question. — Elon Musk (@elonmusk) April 23, 2019
To literary put the fire out of the scenario, Tesla has released an update to strengthen the safety of their car batteries, this update is available to all Tesla Model S and Tesla Model X. The new software aims to make the thermal management of the battery of the car better, thus preventing overheating unexpectedly.
In a statement provided by the company, they said that they are still investigating the causes of the fire and other hazard prevention. Tesla has nearly half a million vehicles on the road, which is more than double the number they have at the beginning of last year, and they will be using this data to investigate such incidents. They are also reviewing the loading and configuration in Model S and Model X by updating the over-the-air software, which starts today, to help protect the battery and increase its longevity.
This update will hardly be noticed by the Tesla drivers since it is purely a security measure that changes internal procedures in the model. There is no mention if the Model 3 will receive the same update.
