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Tesla Stock Rockets Despite Hazardous Adapter Recall

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The fourth quarter was a definite success for Tesla Motors Inc.

The electric car maker indicated yesterday that its Model S sedan deliveries surpassed original predictions by 20 percent. As Tesla delivered about 6,900 sedans during the quarter, shares shot up by almost 16 percent.

“We look forward to 2014 with anticipation,” said Jerome Guillen (vice president of global sales and service) at a Detroit Auto Show news conference, adding, “On the sales and service side – of which I’m responsible – it’s reckless growth.”

Guillen later corrected himself, saying he misspoke and meant to say “relentless growth”; however, speculators might call this a Freudian slip, given the less optimistic press Tesla got on Tuesday when U.S. safety regulators classified Tesla’s move to upgrade wall adapters and charging software as a “recall”. The National Highway Traffic Safety Administration claimed in documentation that, “An overheated adapter, cord, or wall receptacle, increases the risk of burn injury and/or fire.”

These safety statements follow the company’s Friday announcement and Sunday letter regarding a small number of fires relating to the adapters.

Tesla announced it would provide new adapters and software upgrades to customers to avoid charging system overheating, but C.E.O. Elon Musk quickly disputed the NHTSA’s choice of words via Twitter. He explained that the software upgrade was done last month over the air and that owners would receive the new adapters via mail.

Although the company says it will recall 29,000 chargers, it has denied that the charger itself was the cause of the fire.

Musk declared that the software update “alone addresses any potential risk,” before describing the strategy: “I call it a belt and suspenders approach, so even though we feel very confident about the software update, the adapter is something that provides additional surety.” He then added, “We just want people to have absolute peace of mind.”

“Peace of mind” is something Tesla investors can also look forward to maintaining, as the company’s stock continues to ascend and remains unaffected by the adapter matter. Per Guillen, the company expects its global sales and service locations to double in 2014. Meanwhile, Tesla’s Model X crossover is still in progress, as they are “feverishly” working to introduce it later this year.

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Tesla Stock Rockets Despite Hazardous Adapter Recall
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  • Hamilton

    Tesla’s are a fire hazard. Tesla adapters and connectors have melted and burned. The software update was just a band-aid. Tesla adapters and Tesla connectors still overheated. Replacing the adapter with one with a thermal fuse, is again probably only a band-aid. The Tesla charger adapters and connectors still have design flaws and possible manufacturing flaws. Tesla is being reactive instead of being proactive about safety. The Tesla model S. as a recall because of the problems with its charging system. Several people have been injured by the bad burned charge connections. It is a fire hazard. Elon Musk is dishonestly trying to divert attention away from the Tesla safety hazard with his dishonest recall arguments. Corporate greed is putting public safety as a low priority. Elon Musk should learn the definition of recall.

  • Jim5437532

    Ongoing Tesla fire hazard. Tesla charger connections are still overheating, melting and burning.

    On January 9, 2014 Elon Musk said that replacement adapters that are part of the recall would be mailed out within two weeks. A month later Tesla customers have still not received the replacement adapters that are part of the Tesla model S. recall.

    Several people have been injured by faulty Tesla charge connectors. Tesla is big on making promises, but short on delivery. Tesla needs to start making safety a top priority.

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