Tesla shares plunge after magazine drops Model S recommendation
21 October 2015 | 0
Tesla shares plunged more than 15% after magazine Consumer Reports announced it was withdrawing its recommendation of the company’s flagship Model S P85D electric sedan.
The price of Tesla shares had climbed by the closing bell, but it still ended the day down 6.6%.
The consumer products ratings publication gave the $104,000 electric car a “worse-than-average” rating in its latest report about the predicted reliability of new vehicles.
The new reliability rating, initially announced in Detroit at an Automotive Press Association meeting, contrasted sharply with Consumer Reports’ initial assessment of Tesla’s all-electric sedan.
In August, the publication gushed about the Model S P85D, saying it was “the best car” it had ever tested, and gave the sedan a score of 103 out of 100 points after a road test.
“The car set a new benchmark, so we had to make changes to our scoring to account for it,” Consumer Reports said at the time.
However, the publication updated its review of the car after it received the results of a survey from 1,400 Model S owners, who chronicled “an array of detailed and complicated maladies”.
The main problem areas involved the drivetrain, power equipment, charging equipment, the giant iPad-like center console, and body and sunroof squeaks, rattles and leaks.
The Tesla Model S wasn’t the only high-performance vehicle that sank to a below-average reliability rating. Others include the BMW X5 and 5 Series, and the Chevrolet Corvette.
“When automakers roll out new technology, be it infotainment, transmissions, or engine variations, it often has a deleterious effect on vehicle reliability. Tesla is not only the poster child for a new type of high-performance, high-mileage EV [electric vehicle], but it also has been adding complex new variations as assembly-line updates, such as all-wheel drive this year,” Consumer Reports said. “So it’s not surprising to see problems continue to crop up.”
Regardless of the complaints, the Tesla Model S P85D still topped Consumer Reports’ owner satisfaction ratings for luxury cars, with 97% of people who own the car saying they would buy it again.
The Audi A7 and Lexus LS were tied at No. 2 in the luxury car owner satisfaction ratings, with scores of 84% – well below the Tesla sedan’s 97%.
Nevertheless, survey respondents focused on specific areas and the car scored this year than it had last year. Respondents said most problems were related to the climate control, steering and suspension systems.
Other problems owners noted were inoperable wipers, leaking battery cooling pumps, out-of-alignment trunk and hatchback latches, and persistent wheel-alignment issues.
Complaints about the drive system have also increased as the Model S cars have aged – specifically for the 2013 model, which was the car’s first full model year, the magazine said.