Despite tweets last Friday by Tesla CEO Elon Musk implying federal regulators have dismissed allegations that Model S suspensions have design defects, this is not the case.
The National Highway Transportation Safety Administration (NHTSA) actually said last week it is looking further into concerns initially raised by writer Edward Niedermeyer in the Daily Kanban, and is contacting consumers and reviewing complaints it has on file.
But the tweets by Musk seemed to put a close to the media firestorm that flared after Niedermeyer’s story likened Tesla’s actions to GM’s cover up of its ignition switch scandal. On that news, TSLA stock dove 4.6 percent, or about $1.5 billion in valuation, sending the company into damage control mode.
Musk’s tweets also followed a simultaneously defensive and counter-accusatory June 9 Tesla blog post outlining its assertion that it makes the safest cars in the world, and Musk’s words could have been interpreted to mean NHTSA was moving on.
“NHTSA confirmed today that they found no safety concern with Model S suspension and have no further need for data from us on this matter,” tweeted Musk on Friday, June 10.
“To date, NHTSA has not identified any safety issue with Tesla’s suspensions,” said NHTSA Director of Communications, Bryan Thomas on Friday, while saying also that NHTSA is for now satisfied with info provided which it is still examining.
On Monday this was verified by Thomas, who reiterated statements made last Thursday and Friday that NHTSA is in a “screening” phase of its standard protocol of examining safety related concerns in its role as guardian of the public safety.
If it finds more, it may escalate things to a full recall, or it may choose another action, or simply drop it after it has finished going through info supplied by Tesla, consumers, and other sources.
“NHTSA is examining the potential suspension issue on the Tesla Model S, and is seeking additional information from vehicle owners and the company,” Thomas had said June 9 prior to Tesla’s compliance with that initial request.
“NHTSA’s review of the Tesla Model S suspension is a routine data collection. Tesla has fully cooperated with our requests for information, and NHTSA’s examination of the data is underway,” said Thomas on Friday June 10.
Led by Musk, some peoples’ attention was diverted away from Thomas’ words that Tesla was not out of the woods quite yet. While Thomas had said NHTSA’s “examination of the data is underway,” a seemingly relieved Musk emphasized NHTSA had been satisfied and went on to allege potential conspiracy and fraud against Tesla.
“Of greater concern: 37 of 40 suspension complaints to NHTSA were fraudulent, i.e. false location or vehicle identification numbers were used,” said one Musk tweet.
“Would seem to indicate that one or more people sought to create false impression of a safety issue where none existed. Q is why,” said another tweet.
Again, Musk is partially correct. More than 30 complaints were indeed posted with federal authorities by one man, Keith Leech of New South Wales, Australia. Leech’s activism has been an order-of-magnitude more provoking than Niedermeyer who never named him, but who was nevertheless part of the background that led up to the Daily Kanban’s article.
Musk may be aware of this also as he alleged malicious intent, but NHTSA has not called complaints filed on SaferCar.gov “fraudulent” in any public statement it has made. Nor have filings by Leech been removed or refuted thus far by the agency.
On Monday, June 13, a NHTSA hotline representative further confirmed it does permit non-U.S. citizens to make complaints about U.S. cars that they do not own, indicating nothing would be out of order with such filings.
NHTSA’s consumer tip hotline is not intended to suppress consumer concerns, and even allows for anonymous tipsters.
Tesla on the other hand was corrected by NHTSA for seeming to impose non-disclosure agreements in exchange for “goodwill” repair service at its service centers. These may involve a favor negotiated by Tesla with those who may be out of warranty, or think a claim should be covered when Tesla might have disageed.
“NHTSA learned of Tesla’s troublesome nondisclosure agreement last month,” Thomas had said June 9. “The agency immediately informed Tesla that any language implying that consumers should not contact the agency regarding safety concerns is unacceptable, and NHTSA expects Tesla to eliminate any such language.”
The federal agency also cited Tesla’s answer to it.
“Tesla representatives told NHTSA that it was not their intention to dissuade consumers from contacting the agency,” Thomas continued, “NHTSA always encourages vehicle owners concerned about potential safety defects to contact the agency by filing a vehicle safety complaint at SaferCar.gov.”
Tesla’s aforementioned blog post further sought to allay concerns by NHTSA and the public.
“Tesla has never and would never ask a customer to sign a document to prevent them from talking to NHTSA or any other government agency,” said Tesla’s blog post signed by the Tesla Team. “That is preposterous.”
Tesla did however agree to amend its wording of future Goodwill Agreements following the federal rebuke.
Open Questions Remain
At this stage, while the jury is most definitely out on several questions, a brouhaha accompanied by several accusations in the media, by Tesla, and others, may only be a byproduct of a still-learning Tesla as it seeks to grow into a mass-market automaker.
It is unclear if Musk merely assumed certain filings on SaferCar.gov would be called “fraudulent,” however a request to shed light on the matter was denied by Tesla.
“Thanks for checking with us on these [questions]. Most of the questions you asked have been addressed on our blog, and via tweets from Elon which have also been posted to the blog (at the bottom of the post),” said Tesla representative Keely Sulprizio yesterday. “In addition, it sounds like you already have the statement from NHTSA, which addresses your question about our Goodwill Agreement. This is the extent of the information we’re sharing right now.”
Innocent Until Proven Otherwise
At issue have been concerns raised over aluminum suspension components and steel control arms that have allegedly worn out much too soon, with potential to suddenly fail.
Niedermeyer, who writes also for Bloomberg View and is the former editor of The Truth About Cars, connected the dots from forum posts and other related information. His story cited a Model S owner who posted to the Tesla Motors Club forum that Tesla agreed to pay half of a $3,100 repair bill if he agreed to keep the arrangement confidential.
Tesla’s blog post, titled, “A Grain of Salt,” was so titled because it insinuated the “gentle soul” Niedermeyer was someone with a grudge against Tesla since 2008 and that he might possibly be trying to game the stock price to make an unethical profit.
“We don’t know if Mr. Niedermeyer’s motivation is simply to set a world record for axe-grinding or whether he or his associates have something financial to gain by negatively affecting Tesla’s stock price, but it is important to highlight that there are several billion dollars in short sale bets against Tesla,” said Tesla. “This means that there is a strong financial incentive to greatly amplify minor issues and to create false issues from whole cloth.”
Tesla provided no evidence of financial incentives to Niedermeyer. And, in response Niedermeyer and Schmitt have been writing defensive reports to potentially damaging and defaming words by the influential, and well-regarded Tesla. Both affixed their names to sworn statements on their site that denied they had financial motives in critical reporting.
“I, Edward Niedermeyer, never did own, nor do I own, nor do I plan to own, Tesla Motors shares, puts, calls, or any derivatives that would gain in value through price swings in Tesla Motors stock. I never did short, nor do I currently short, nor do I plan to ever short Tesla Motors stock. I have no financial interest whatsoever in the success or failure of Tesla Motors.”
Some online posters have reacted by siding with Musk, passing along the critical wording of Tesla’s blog post against Niedermeyer, alleging it as fact.
Others have stood back, observing a similarity of tone Tesla has previously uttered in going on the attack, as it did on February 2013 with New York Times journalist John Broder who Musk alleged faked a run-out-of juice scenario.
Drama of a Different Sort
Niedermeyer’s story focused on a Pennsylvania Tesla owner, Peter Cordaro whose Model S ball joint popped out inducing him to begin posting his interactions with Tesla and NHTSA on the TMC forum.
The person Niedermeyer avoided naming is the Australian, Leech, who’s been vocal while getting himself banned from forums while sticking to his position.
Leech – who also goes by pseudonyms, including Keef Wivaneff (like Keith, with-an-“F”) – is a retired mainframe computer engineer and a electronics sales engineer who now describes himself as a citizen activist – albeit not a U.S. one.
He said in response to queries by HybridCars.com that he does not own a Tesla, is not against green energy or EVs, and aspires to get a plug-in car as he already lives off grid via solar energy, but has detected a trend with Tesla accidents that alarm him.
“I was watching Tesla closely and started to notice all of these cars that had missing wheels coming up on Google,” said Leech saying “crashed Teslas” was one of his keyword searches. “That then led me to the [salvage car] auction sites and I became really alarmed by the number of cars that had the same sort of failures.”
“Peter Cordaro’s rusted ball joint was the first failure of that component that I have seen,” said Leech. “It concerns me less than the fractures of the alloy front steering knuckle and rear suspension.”
“The front steering knuckle has been redesigned at least once and possibly twice but I am still seeing cases where the tip has snapped off or it has broken halfway,” he said. “The rear suspension has been ripped completely off in many cases without any collision damage that would account for it. I believe that the front steering knuckle is too weak and in some accounts of the accident circumstances it seems that it has failed under emergency braking.”
Leech said he is persistent because he thinks Tesla led by Musk has a culture of denial, and even cover up, as Niedermeyer’s post also alleged.
“Many of the wrecked cars have gouges in the tire or the rim that looks as though it happened while the car was still rolling forward. There are pictures and forum reports of bolts coming loose which may be the cause of such damage,” he said. “Unlike most other cars the important nuts are not secured with Nyloc nuts or pinned nuts but instead rely on use of Loctite and felt pen markings to detect movement. That is not good engineering practice.”
Tesla’s reply yesterday saying it had no further comment, was in response to questions about Musk’s allegations that claims were “fraudulent,” about its NDA wording amendment, and these same statements by Leech printed above.
Leech has indicated he’s willing to take issues to the proverbial mat, and last decade as an Australian TV news report shows, Leech won a defamation suit over an alleged solar scam. This weekend he threatened to also take Musk to court over his tweets if he does not apologize for what he considered Musk calling him a liar and fraud.
His agenda, he said, is to raise attention loud enough to provoke NHTSA to more-closely examine Tesla’s suspension design.
“I’ll leave the detailed analysis to the experts but I have seen enough photographs of failed parts to be pretty certain that there is a weakness that should be investigated,” said Leech who also says he has mechanical know-how. “All I’m saying is that common sense and mechanical expertise suggests that there is a problem and that there should be an investigation.”
His confrontational style has also seen Leech called a “troll” by commenters online, who have questioned some of his other speculations as outlandish. One example is his assertion that SpaceX faked its initial Falcon 9 first-stage rocket return landing. Leech however said Tesla fans have at times bullied and sought to marginalize him even when wasn’t reaching for high-flying levels of speculation.
It is at least clear his anxiety over what he sees as too many wheels breaking off has led him to personally mock Tesla and Elon Musk, which wins him no friends in that community. This he is willing to do, he said, if only he can get the cars checked in order to “save lives.”
Although Tesla denied further comment, it did refer to its blog post, and Musk’s tweets.
Tesla has unequivocally said there is no problem, and if there were it would know about it and fix it.
“First, there is no safety defect with the suspensions in either the Model S or Model X,” said Tesla’s blog post.
“Whenever there is even a potential issue with one of those parts, we investigate fully. This, combined with extensive durability testing, gives us high confidence in our suspensions,” said the automaker.
“Tesla’s own actions demonstrate just how rigorous we are about bringing issues to NHTSA’s attention,” Tesla said. “Not only do we regularly meet with NHTSA, we have also shown that we won’t hesitate to conduct proactive and voluntary recalls even when there is only a slight risk of a safety issue.”
The blog post cited a Model X seat recall done voluntarily.
“There is no car company in the world that cares more about safety than Tesla and our track record reflects that,” said Tesla.
And, Tesla said, the Model S has a 5-Star safety rating in its crashworthiness in every category and subcategory, and the X is expected to receive the same rating.
After several inquiries on Friday and Monday, NHTSA did reply via phone and e-mail. The short answer is it’s in process of further examination, said Thomas, but it prefers not to share any more details.
“This issue is in the screening stage (or as we referred to it in the statement, as routine data collection),” said Thomas, who otherwise referred to previous statements on file as the agency continues to see if there is anything more to be concerned about.