Tesla shares have dropped 10 percent after a recent video of a Tesla Model S sedan was put up on YouTube. The video shows footage of the vehicle in flames after a large piece of metal punctured the vehicle’s protective armor, piercing the lithium battery ion. The Model S is a fairly new electric car that was introduced to the public back in 2009. Retail deliveries began in June 2012. The video surfacing on the internet has become a growing concern to investors as the public begins to question the safety of the lithium battery ion. However, Tesla Motors Inc. CEO and co-founder, Elon Musk, defended the electric car’s safety in a recent blog post. Musk reiterates that the cause of the fire was not a malfunction of the vehicle but an external factor that penetrated the battery causing it to burst into flames. In a letter to Tesla, the driver of the vehicle expresses his unyielding support for the company, stating that
“I guess you can test for everything, but some other celestial bullet comes along and challenges your design. I agree that the car performed very well under such an extreme test. The batteries went through a controlled burn which the internet images really exaggerates.” – Rob Carlson
It was an unfortunate accident that was foreseen by none. This just goes to show the power of a brand and how important the name is. If not handled properly, freak events similar to the Model S fire can tarnish a brand permanently and will require mass amounts of effort to overcome.
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