Federal Investigators Looking Into Tesla Fire This Week

The National Highway Transportation Safety Administration (NHTSA) will review details and potential safety concerns surrounding the third Tesla Model S fire to occur in the past five weeks.

Yesterday – ironically not far from Nissan’s Leaf factory in Smyrna, Tenn. – a Model S driven eastbound on Interstate 24 is believed to have struck a trailer hitch lying on the road which damaged the undercarriage and initiated the blaze.

A similar type of accident occurred in Washington State early in October, and another fire happened following a collision in Mexico, but federal authorities do not investigate such incidents outside U.S. borders.

This third accident did however prompt the federal agency to issue a statement.

“NHTSA will contact the local authorities who are looking into the incident to determine if there are vehicle safety implications that merit agency action,” said NHTSA.

This news follows a mixed third-quarter financial report on Monday that did not match high expectations and which has sent TSLA stock tumbling from a high of over $171 to a low of $137.62 this morning after the report of the fire.

To date no Model S occupants have been injured by fire but being a new technology, and with Tesla’s stock flying high above fundamental valuation metrics, investors’ nerves have been rattled.

Tesla spokeswoman Liz Jarvis-Shean was quoted by the AP saying Tesla believes the car saved the driver’s life in Tennessee and Tesla has sent a team of investigators to learn more.

Photos of the burning car were posted on Jalopnik.

For their part, Tesla enthusiasts have already conceded in online discussions that the low-riding Model S may be vulnerable to some forms of debris. The car’s suspension system does lower the car further for aerodynamic and ride control benefits.

Advice offered has included perhaps the addition of some kind of sturdy “cow catcher” in front and down low to sweep away debris that is inadvertently struck by the low-slung car.

Tesla has made no statements on this at this early stage.

What has been said over and over by numerous sources is Tesla is under the microscope, as are all battery powered cars.

Many in the public do not know so much about them, and fires are considered newsworthy to a far higher degree than fires of gasoline-powered cars – which have long-since killed and maimed people for decades, and still do.

To date, no one has died in an EV fire. It may well happen some day, and it’s anyone’s guess how reactionary people will be, or how rational and level headed they alternatively might be.

At the moment, reactions are underway.

Tesla’s stock 5 minutes before the market close is hovering around $139.91. After a long run-up of over 400 percent since last year, nervous investors and speculators are opting to sell.

Whether the cuts to Tesla’s market capitalization will continue through tomorrow and next week is an open question, as is what will come of NHTSA’s inquiry.

In 2011 following a side-impact crash test with the Chevy Volt that led to a fire within a couple weeks following, daily headlines evoking the name of the car and “fire” did little to help perceptions with the general public.

Tesla has however basked in far more positive press than had post-bankruptcy General Motors, so we’ll see whether this PR fire can be snuffed out sooner rather than later.