Tesla investors displayed a bit of doubt on Wednesday, driving stock down after a YouTube video of its popular Model S sedan on fire circulated online. The video, shot near Seattle, marks the first time that a Model S has caught on fire, but Washington State Patrol told the Associated Press that the fire wasn't started by the car itself. Instead, the car seen in the video, which was first reported by Jalopnik, collided with some debris on Washington's Route 167 on Tuesday morning.
The debris triggered the fire, but troopers were unable to locate the debris after the accident, State Patrol said. There were no injuries in the accident and the fire was contained to the front of the all-electric vehicle. Still, Tesla's stock took a 6.24 percent dip, falling $12.05 a share to a closing price of $180.95. Adding to the drop in share price was a downgrade from RW Baird analyst Ben Kallo, who warned of "several milestones that could contain execution risk" in the company's future. Kallo now rates Tesla as neutral rather than outperform.
The stock decline is relatively minor — Tesla stock has jumped up more than 400 percent since the beginning of the year. Still, some investors are jittery at the sight of a burning electric car. For its part, Tesla told Jalopnik that the Model S reacted to a
Tesla says the Model S didn't start the fire collision with a "large metal object" just as it was supposed to. "The car’s alert system signaled a problem and instructed the driver to pull over safely, which he did," Tesla explained. "No one was injured, and the sole occupant had sufficient time to exit the vehicle safely and call the authorities. Subsequently, a fire caused by the substantial damage sustained during the collision was contained to the front of the vehicle thanks to the design and construction of the vehicle and battery pack."
Tesla, of course, isn't the first car company to see one of its models go up in flames. Last year, General Motors was the subject of a National Highway Traffic Safety Administration (NHTSA) investigation after one of a Chevrolet Volt plug-in hybrid caught on fire during a routine test crash. GM found that the cause of the fire was a battery pack that was punctured in testing, and it made enhancements to the Volt to prevent owners from running into the same issue. NHTSA later closed its investigation saying that it failed to find any systematic defects.