Tesla’s stock (TSLA) tumbles following Consumer Reports on Model X issues

model x doors shot

Tesla’s stock price ($TSLA) surprisingly tumbled following a new report from the review magazine Consumer Reports highlighting some quality issues with early Model X units. The stock fell over 4% after the report was published this morning, but gained in the afternoon and it is now down only 2%.

I say the tumble is surprising due to the report hardly containing any new information. The magazine cites one particular case of a Model X owner having some issues needing a few service center visits and then add some data point by also citing “message boards” complaints about the vehicle.

Quality issues with Tesla’s early production models have been reported and acknowledged by Tesla in recent past. Here’s our article on it from last month:

Following Consumer Reports’ comments, a Tesla spokesperson issued a statement:

“We are committed to making the world’s most reliable cars. While we have seen some issues with early Model X builds, the issues are not widespread, and we are working closely with each owner to respond quickly and proactively to address any problems. We will continue to do so until each customer is fully satisfied. This commitment is one of the reasons why 98 percent of our customers say they will buy another Tesla as their next car.”

Earlier this month, Tesla confirmed it delivered 2,400 Model X SUVs during the past 3 months and that it recently managed to ramp up production to 750 units per week following the quality issues and supplier parts shortages. The company expects to be at full production capacity of about 1,000 units per week by the end of the quarter.

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Comments

  1. md - 7 years ago

    The desire is extreme, but this is the reason I am not preordering the M3. The same goes for other first model year cars though.

    • aarond12 - 7 years ago

      Go ahead and pre-order your Model ≡. You won’t get it until 2020 at the earliest, meaning they will have 2 years to work out the bugs. That’s what I’m betting on.

      • dcj001 - 7 years ago

        Sure. But, by that time, Apple’s car will be available, and it will be so much better than this Tesla!

      • md - 7 years ago

        I think I will get it in just before the half mil number.
        Also, I don’t believe a first gen apple car would be price competitive at all, even if it was possible for them, historically they are a brand that pride themselves on brand identity and loyalty, and take extreme margins just for that fact.

      • Sam - 7 years ago

        @dcj001: nice, you’re assuming that Apple’s car will be better when it hasn’t even been announced and yet Tesla has been developing cars for a decade. Cars are not phones.

  2. Tom - 7 years ago

    (Small comment):
    I think you have to be careful about walking the line between being enthusiastic about Tesla and a sort of more bullish fanboyism towards it. I think the point is that people were expecting Tesla to learn from the issues with the Model S and reduce the number of early production errors happening with the cars. Of course I understand these reports aren’t comprehensive and the Model X is a far more complex car than the S, but then that of course begs the question as to whether it should have been designed that way in the first place. Tesla did themselves say that they would learn from the lessons of the Model S, so that ought to be the criteria upon which people judge them – whether they are keeping their word. In that sense, if is surprising that these issues are occuring, if indeed the problem is widespread, so to suggest the reaction is surprising is perhaps a bit much.

    • Jens - 7 years ago

      But every car Brand has issues with early Production models. Wether Tesla has more or less issues than others, I don’t know. That’ where statistics would be more helpful than a few non representative reports.

      Look at even the major software companies, like Microsoft and Apple. How many bug fixes they have to ship to their new OS versions – despite decades of experience. The products are so complex, you just can’t think of every problem that will arise. It’s the same for car manufacturing, I expect.

    • Bubba2000 - 7 years ago

      Initial MS had some minor bugs, but has been fixed. MX is a complex, but the problems will be fixed, just take longer. I expect M3 to be designed for easy manufacture. No big glass structure, Regular door handles. Simple interior. The folks at Tesla are not dummies. Just let their hubris get to them.

    • traveler501 - 7 years ago

      Who else could even build the Model X? Meanwhile, it could be apocryphal …but the story goes that the first Corvette that rolled off the line in 1953 wouldn’t run because no one had thought to run ground wires on a fiberglas car. My point? Don’t be so quick to knock a brilliant, land breaking design like the Model X because of a couple glitches early on. Moreover, be aware that Tesla intentionally issued their early deliveries to local buyers specifically to facilitate any last minute tweaks that might be required. Tesla deserves huge kudos for this tour de force…and for their attention to quality and customer service during the rollout. You’re witnessing history in the making…who cares what some Consumer magazine says?

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