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Tesla's bumpy relationship with Consumer Reports exposes a bigger challenge

Tesla's bumpy relationship with Consumer Reports exposes a bigger challenge

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Photo by Amelia Holowaty Krales / The Verge

How do we judge Tesla’s progress over time?

Tesla, unlike other automakers, doesn’t have traditional model years. The predictable schedule of small annual updates between major refreshes isn’t part and parcel of Tesla’s DNA, nor its hardware.

Instead, the tech-centric company regularly updates software to improve or add performance and safety features in its electric vehicles. These wireless over-the-air software updates are a selling point to consumers who see value in, and are willing to pay for, a vehicle that theoretically improves over time.

Tesla is judged more like a student — in marking periods, at the discretion of its critics. The recent nick and partial restoration of Tesla’s standing with Consumer Reports is more than just another bump in the up-and-down relationship between the rating organization and the electric automaker.

how do the consumer, the investor, and even Tesla itself measure its own progress?

It also highlights one of Tesla’s greatest attributes and its biggest challenges: how do the consumer, the investor, and even Tesla itself measure its own progress?

The updates are among customers’ favorite features that set Tesla apart, but this process can, on occasion, backfire and even cause discontent among owners when there isn’t consistency among its vehicles.

Three weeks ago, the Tesla Model S lost its top spot in the ultra luxury vehicle category after Consumer Reports lowered its score because newer versions of the sedan didn’t have a functioning automatic emergency braking system — a safety feature Tesla said would come standard in its cars. Model X was also docked two points on the Consumer Reports 100-point scale.

Now, Tesla is climbing back up Consumer Reports’ vehicle ratings after the electric automaker updated its software to add automatic emergency braking to its new Model S sedans and Model X sport utility vehicles.

CR restored only one of the two points it docked Tesla because the updated braking system doesn’t work at highway speeds. Older iterations of the S and X have AEB systems that work up to 90 mph, according to Consumer Reports. Once the vehicles have AEB operational at higher speeds, CR says testers will reconsider the scores. The Model S now has a score of 86, and sits just one point behind the No. 1 Lexus LS.

In October, Tesla began producing Model S and Model X vehicles with a new robust suite of sensors, radar, and cameras. These “hardware 2” vehicles aim to push automated driving capabilities to new levels — eventually.

When the first deliveries of Hardware 2-equipped vehicles began, they were less capable in some ways than their earlier predecessors. New software is released after Tesla validates it.

The upcoming Model 3 will be a test of its OTA software strategy

The automatic emergency braking system, which comes standard in the car, was supposed to be rolled out in the new vehicles by the end of 2016, CR says. Instead, the AEB software update began at the end of April.

Tesla has said AEB and other safety features are a top priority and will introduce them as soon as they’re ready. The company directed The Verge to its statement from last month.

“We believe it would be morally wrong and counterproductive to our goal of improving consumer safety to release features before they’re ready, and we believe our customers appreciate that,” the Tesla statement said.

CR, which has been both a critic and a fan of the company’s vehicles, says it didn’t dock Tesla two points because the company took its time to validate the software, according to Jake Fisher, director of automotive testing at Consumer Reports. CR dubbed the Model S the best car it’s ever evaluated in 2014. It bumped it up even further in 2015, only to drop its recommendation later that year because a survey of owners raised reliability concerns.

“When we purchased the vehicle we were told the car would have this system by the end of 2016,” Fisher said. “The idea of validating things and putting on new enhancements later as you own the car is not the problem. The problem is selling a vehicle promising a certain safety device and not delivering on that (timeline).”

The ability to roll out new features is what makes Tesla unique and appealing, Fisher added. The problem is that the company promised this standard safety feature by the end of December and it took five more months to deliver on that, he said.

“It’s not about awarding it the top score or penalizing Tesla; all we’re doing is just being very clear to consumers what they get with this car,” Fisher said.

OTA software updates have allowed Tesla to bring newer versions of its vehicles to the marketplace at a pace that’s closer to a tech company, not an automaker. However, that strategy can lead to disappointment when features are deployed slower than expected.

Tesla’s use of this technology is challenging auto industry standards. Now Tesla must transition from buzzy disruptor to a company that serves a variety of customers, not just its fans and well-heeled early adopters.

These new customers may be initially wooed by Tesla’s tech and brand ethos. But they’ll only be won over if they understand exactly what they’re getting, and if Tesla delivers.