Tesla defends safety record after stock falls 6%
All-electric car company says it is working with NHTSA to amend its non-disclosure clause on repair agreements
Tesla is defending its safety record, after a report that the U.S. auto regulator was looking at its suspension systems sent its stock down six per cent.
In a blog post that went live late Thursday, Tesla denied there was a probe of its suspensions by the National Highway Traffic Safety Agency and said a non-disclosure clause it signed with a customer was not a tactic to prevent a report of safety problems to the NHTSA.
On Thursday, a blogger reported a possible defect in the Tesla Model S may cause suspension control arms to break and said the NHTSA had launched an investigation of the problem.
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The electric car company's stock has been dropping ever since, from $233.59 US on Thursday to below $220 on Thursday afternoon.
In its blog post Tesla said NHTSA has not opened any investigation and the safety agency later backed up that claim.
"On April 20th, as part of what it has told us it considers 'routine screening,' NHTSA informally asked us to provide information about our suspensions. On April 30th, we provided all relevant information to NHTSA. NHTSA has since told us that we have cooperated fully and that no further information is needed," Tesla said in its blog post.
Controversial non-disclosure clause
It said it does pay for some repairs and asked for a "non-disclosure clause" on fixes to some Tesla cars, but denied this is a way to prevent the customer from going to NHSTA.
"The basic point is to ensure that Tesla doesn't do a good deed, only to have that used against us in court for further gain," the Tesla post said.
This complaint was taken to the California Better Business Bureau and later resolved, according to Reuters.
It pledged to work with the safety agency to amend the wording of its non-disclosure agreements. The NHTSA confirmed it is looking into Tesla's non-disclosure agreements.
Blogger has death watch on Tesla
Tesla questioned the motives of the blogger, Edward Niedermayer. who wrote a blog titled "Tesla Death Watch" in 2008. There are several billion dollars invested in short positions on Tesla stock, the company pointed out..
Tesla's blog post played up its safety record — including the five-star rating on the Model X.
"Recently, a Model S was in a very high speed accident in Germany that caused it to fly 82 feet through the air, an event that would likely be fatal in vehicles not designed to the level of safety of a Tesla. All five occupants were able to exit the vehicle under their own power and had no life-threatening injuries," the post said.
It pointed out two recent recalls of Model X vehicles — one for a problem with third row seats, the second for front seat belts — saying both were voluntary recalls, rather than ordered by the NHTSA.