Tesla Motors Inc. (TSLA)’s stock pared declines at the close yesterday after the electric-car maker said an Oct. 1 fire in one of its vehicles was caused by a crash.
Tesla fell 6.2 percent to $180.95 in New York. Earlier the shares tumbled as much as 9.1 percent after a picture of a Model S fire in Washington state was published by the Jalopnik website. The drop was the biggest one-day slide since July 16.
The Model S “collided with a large metallic object in the middle of the road, causing significant damage to the vehicle,” Palo Alto, California-based Tesla said in an e-mailed statement. The driver exited the vehicle safely and called authorities. A fire caused by damage sustained in the crash was contained, Tesla said. The website had earlier said it couldn’t provide a reason for the incident.
Tesla, which has seen its market value top $20 billion this year, is intent on becoming the world’s most profitable seller of battery-powered autos, using technology designed in-house.
Debris that may be related to the Kent, Washington, collision was collected by the state’s Transportation Department, the Washington State Patrol said yesterday in a statement. The collision report should be available in a few days, the agency said.
“The driver stated that he began to smell something burning and a short time later the vehicle caught on fire,” according to the State Patrol statement. An emergency crew had to make “several attempts to extinguish the flames as it kept reigniting,” according to the statement, without elaborating.
Flames also burned in the car's battery pack, the Associated Press reported, citing comments made by firefighters in a copy of an incident report the news service said it obtained under state public records laws.
The company’s plans to boost production and add new models increase execution risk that could weigh on the stock, Ben Kallo, a Robert W. Baird & Co. analyst, said yesterday. Kallo downgraded the company to neutral from outperform.
The electric-car maker is increasing output of its Model S sedan and plans to introduce a Model X sport-utility vehicle and “any hiccups in execution present stock-price risk in the near to intermediate term,” Kallo wrote in a report.
The company plans this year to deliver 21,000 of its flagship Model S sedans, priced from about $70,000, and double that volume next year as sales in Europe and Asia expand.
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