
Tesla Motors Inc stock sinks as third car in 5 weeks catches fire - WestCoastJustin
http://business.financialpost.com/2013/11/07/tesla-motors-inc-stock-sinks-as-third-car-in-5-weeks-catches-fire/
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tzs
If corporations had senses of humor, Boeing would make a public offer to help
Tesla with their batteries.

~~~
sp332
"Have you tried flying your cars through the air? There's less junk to run in
to up there."

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ameister14
Well, as most of Tesla's stock performance has been based on rampant
speculation, I'd say this has been coming for a while.

I did the math on Tesla when I invested in it early this year, and it should
have topped out at around 44-46 a share, calculating in the difficulty of
reaching their goals over the next two years with no significant issues. Then,
after different stages were reached, it should have risen. This did not
happen. Instead, it rocketed up immediately.

That was all flash in the pan investment and not real analysis of the company,
so it's no surprise that it's decreasing when there are minor problems.

~~~
Nicholas_C
>I did the math on Tesla when I invested in it early this year, and it should
have topped out at around 44-46 a share

What math did you do? An intrinsic valuation? That would seem very speculative
given Tesla's uncertainty.

~~~
001sky
math has a funny way of revealing all kinds of flaws

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bliti
Gasoline powered vehicles are not exempt from fire issues. Fact is, one of the
best selling vehicles[1] in the U.S. had a recall due to how it would catch
fire _while parked_. I personally saw one on fire on a parking lot. It was
baffling.

Another recall from the 70's was this one:
[http://en.wikipedia.org/wiki/Ford_Pinto#Fuel_tank_defect](http://en.wikipedia.org/wiki/Ford_Pinto#Fuel_tank_defect)
People seem to forget that they are driving around with gallons of combustible
liquid.

[http://www.nytimes.com/2006/08/27/automobiles/27FORD.html?_r...](http://www.nytimes.com/2006/08/27/automobiles/27FORD.html?_r=0)

~~~
tedunangst
The recent ford recall had nothing to do with gasoline. I think people keep
missing that point. If tesla's cruise control switches were the parts catching
fire, this wouldn't be a big deal.

~~~
bliti
>The recent ford recall had nothing to do with gasoline.

I disagree with this point. A fire in a gasoline powered vehicle always has to
do with gasoline. Even if the fire did not start due to an issue in the fuel
delivery system. This system is commonly laid out in a way that most of the
vehicle is near a fuel line at all times.

I am not defending Tesla, but pointing out that gasoline powered vehicles also
carry fire risks. Do realize that gasoline powered vehicles also carry
batteries that may explode/catch fire under given circumstances. I've had a
battery or two blow up near me before, and it is not fun.

~~~
maxerickson
You don't count the floor pan as any sort of isolation?

------
Zikes
Isn't it pretty standard for a vehicle to catch on fire when significantly
damaged?

I've personally witnessed a few that were the result of wrecks, and just the
other weekend I drove by a couple guys trying to put out a flaming engine on a
beat up old truck.

How exactly do these compare to gasoline/diesel powered vehicles?

~~~
Shivetya
* I posted this comment on the same story elsewhere.

Face it, battery technology is not sufficiently advanced to deliver good range
without some serious trade offs. The trade off of the Tesla may prove to be
the wrong choice long term.

No one would ever suggest lining the bottom of a car with a gasoline tank,
fortunately we don't have too because the power density is so high. Hence they
can put tanks where a collision or road debris damage are least likely to
damage them.

However Tesla needs a stupendous amount of battery to get its range. Hence we
get large cars where they have chosen to isolate the entire pack at the floor
of the car. They made the choice to dispense with a central tunnel which could
hold more batteries, not use the front engine area or any trunk space.

There were two or more reasons for their design choice, first because of the
sheer amount of batteries needed and second because of pack swapping. I don't
think the trade off is worth it.

They can use some of the front "frunk" area to have a raised stack of
batteries where the traditional firewall is and do similar in the rear. The
could have a raised tunnel down the center line and reduce the need of having
batteries so far forward. There were many choices available but they wanted
swappable packs.

What statistic I want to see is, how many penetration events have their been
versus how many fires. How many cells have to be penetrated to create a fire?
Is there some flaw that another component is failing during these minor
accidents that is causing the fires?

~~~
umsm
I don't think placement could solve the points you mention.

Sure, debris can damage the underside and cause the car to catch fire, but
putting the packs in the front or rear of the car can cause it to explode on
impact as well. Having it on the underside will probably cause fewer fires
than having it in the front for example.

That said, consider gasoline cars: The fuel needs to travel from the tank to
the engine. Effectively, an impact anywhere on the fuel line can cause a fire.

~~~
stcredzero
_packs in the front or rear of the car can cause it to explode on impact as
well_

Uh, yeah. Are you sure Li-ion batteries really explode, or do they just burn
really fast? (In much the same way it's very, very difficult to get a gas tank
to explode, but not so hard to get it to burn very fast.) I'm pretty sure it's
hard to get them to _explode_.

~~~
umsm
Regardless of whether they explode, catch fire, burn slowly, burn quickly, the
point still stands. Their placement on the underside of the car could probably
be the best choice considering everything.

~~~
stcredzero
There's a big difference between burn and explode.

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fleitz
Which would make this news if a 3.7% daily move wasn't average daily
volatility for this stock.

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JonSkeptic
We've all known that the correction was coming for a long time. TSLA was an
awesome stock, and it will be again.

But I'm glad it's happening now, the sooner the correction is over with, the
sooner we can get a sane valuation, and the sooner people can focus less on
how ridiculous the price is, and more on how freaking awesome the cars are.
(Fires and all)

~~~
larrys
What do you mean by "TSLA was an awesome stock" exactly?

~~~
JonSkeptic
I mean that I hope you sold recently. It'll be a great time to buy soon, but
now it's finally a good day in shortville.

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stcredzero
Really, this headline should read: Lithium Ion Batteries Catch Fire When
Mangled!

~~~
meepmorp
Which is a problem for a company that uses them extensively in large consumer
products that tend to get mangled with some frequency.

~~~
stcredzero
Sort of like gas tanks?

~~~
001sky
_Sort of like gas tanks?_

Petrol is way safer. The tanks are protected behind the second axle, and the
fuel lines are either hardened or flexible, and in any event also well
protected. That is why data show only 2% of fires are caus by problems
relating to the fuel system. Tesla would need to have 200 more fires that did
not involve the LiIon to become safer (on an apples to apples comparison).
Something tells me that proving that case wouldn't do them any good.

~~~
stcredzero
_Petrol is way safer._

Yes, but with petrol cars, we're benefitting from over 100 years of experience
and engineering -- with many, many horrific fatalities included in the
"experience." Considering how recently the Tesla engineers started off, I'd
say they're doing a stellar job. (For heavens sakes, the system tells you
what's up and warns you to pull over and get out!)

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timjensen
Lithium Ion batteries pack a lot of energy it takes less than you think to
start a cascade failure.

~~~
pkulak
Depends on the chemistry. Notice a lack of any Leaf or Volt fires, despite
many more being on the road? Li-manganese and li-phosphate go into thermal
runaway at 2.5C and 3.4C respectively (C being the rate at which a battery
would be depleted in one hour). The Tesla batteries do it at about 300C. Tesla
gets a cheaper and much more energy dense battery in exchange for that risk,
but they also have to deal with PR events like this.

As an aside, I'd totally drive a Tesla if I could afford it. I'm not trying to
say the car is unsafe. They use a riskier chemistry, but they've also gone to
extraordinary lengths to manage that risk with really aggressive thermal
management, barriers, etc. There have yet to be any injuries.

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auctiontheory
It might be useful to see some data on how many Tesla cars have had front-end
accidents and _not_ had fires. To ask it another way, do 100% of accidents
result in a huge fire? Or 0.01%?

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gojomo
At this point, I'm worried that stock manipulators could be setting Tesla
fires.

~~~
philwelch
Anything that doesn't shatter your godlike image of Elon Musk, eh?

~~~
gojomo
Has nothing to do with my estimation of Musk. There are amoral people who have
giant pools of money, who will do anything to make even more money.

Spreading rumors is one very common tactic, but actual sabotage/'black ops'
are also very possible.

~~~
philwelch
It just seems odd that you prefer some conspiracy theory over the simpler
explanation that Model S has an unforeseen flaw involving battery fires, which
are a decades-known risk of lithium batteries anyway.

~~~
gojomo
It just seems odd that you're reading Musk/Tesla-love, or an exclusion of the
possibility of flaws, into my comments. It's like you're responding to someone
else.

I'm mentioning another non-exclusive possibility... and one that would work
synergistically to expand the stock impact of any actual flaws. (It becomes
more likely once the initial idea is planted, be it by flaw or random
coincidence. Turn 2 or 3 real fires into twice as many with a little help,
collect a billion dollars.)

Or do you think high-flying volatile stock values are never unethically
manipulated in either direction?

Hey, where were you during each of the fires so far?

~~~
philwelch
I thought it was odd that you were positing conspiracy theories when they were
not the Occam-optimal explanation. Musk worship is common around these parts
so it seemed the more likely motivation for believing crazy conspiracy
theories over more likely explanations.

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kunai
One share is still worth more than 4 times ORCL's share... so I guess that's
something.

~~~
chollida1
> One share is still worth more than 4 times ORCL's share... so I guess that's
> something.

It's actually nothing. From my bloomberg terminal I can see ORCL US Equity has
a Mkt Cap of $156,024.6M and TSLA US Equity has a Mkt Cap of 16,945.9M

So Oracle is about 9.2 times bigger than Tesla.

~~~
mr_luc
Or to put it another way, its market cap is approximately 1 million dollars
per Model S it has sold to date.

