Will the Latest Tesla Fire Provoke the Typical Hysteria?
Tesla (NASDAQ:TSLA) Chief Executive Elon Musk has expressed his frustration at media coverage of fires occurring in his company’s vehicles in the past. Now that a Toronto fire from early February has been reported by Business Insider, it’s fair to ask whether the coverage will provoke the typical hysteria in the media and the corresponding fall in stock prices. That is, until the company or Musk himself responds publicly to the issue and the stock returns to its previous highs (or beyond).
The circumstances surrounding the latest Model S fire are easy to summarize. On February 1, 2014, a Toronto Tesla owner parked his Model S in the garage of his home. According to Business Insider, the car caught fire and set off the alarm inside the home “after a few moments.” The car was not charging and was not plugged into an electrical outlet. It was a simply a parked car that caught fire on its own.
The report noted that the fire was intense but contained by firefighters quickly. Business Insider reports Tesla employees went to the Toronto house to offer reparations for the damage but the owner declined. A Tesla statement addressing the incident acknowledged the fire and reiterated the position that, while dealing with “occasional fires” is something every automaker must do, gasoline car companies have to do it between five and ten times more often than Tesla.
That’s a fair point for Tesla to make, and Musk has made it several times. In a November 2013 blog post, Musk lamented how “an onslaught of popular and financial media” had been portraying fires in a sensationalistic manner when fires in combustion-engine cars were happening much more frequently. Not only were the fires much more common in gasoline-powered cars, they were often deadly as well, Musk wrote.