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by Mark Stevenson and Bozi Tatarevic
A day after former TTAC editor-in-chief and current Daily Kanban blogger Edward Neidermeyer hit out at Tesla regarding suspension failures and Tesla’s supposed customer bullying through a goodwill agreement on Wednesday, the electric vehicle manufacturer hit back.
According to Neidermeyer’s post, a 2013 Tesla Model S owner on the Tesla Motors Owners forum experienced a ball joint failure at around the 70,000-mile mark, and the owner referred to Tesla for a fix. The automaker offered what’s commonly known in the industry as “goodwill assistance,” which covered half the $3,100 total cost of the repair, as the Model S was out of warranty.
However, the vehicle owner and Neidermeyer took exception to part of the written goodwill agreement as it seems to include a non-disclosure clause, which Neidermeyer contends could dissuade other Tesla issues from reporting issues to the National Highway Traffic Safety Administration and subvert the federal vehicle issue reporting process.
Is Tesla silencing its customers via threat of litigation? And is this ball joint issue even a problem in the first place?
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The Internet is abuzz about a video which purports to show a sleeping driver being chauffeured through stop-and-go traffic by his Tesla Model S on “Autopilot” mode. All sorts of questions have been raised: Is this legal? Is it safe? Could it happen at higher speeds? What happens when you fall asleep behind the wheel of a Model S that is doing 85 mph instead of 10 mph? Who takes vertical videos? Who takes vertical videos seriously, other than the WorldStarHipHop crowd?
I’ll answer most of these questions — below the jump, of course. But the most important question that people are asking goes like so: Is this video faked?
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If I had to think of a single car that would be least likely to demonstrate “road-rage” behavior with a man behind the wheel, I’d have to pick the Tesla Model S, at least until the Model X becomes widely available. Read More >
Tesla CEO Elon Musk has noted on occasion — as recently as last month — that the price of his company’s stock was overvalued, particularly in the short term. Seems Wall Street got the hint, bestowing upon the automaker the biggest one-month loss of market value in October since the last such occurrence in December of 2010.
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I was originally hesitant to jump on the Tesla Roadster “bricked batteries” bandwagon, and my initial story was written with a sort of cautious neutrality. Further context will be provided by the details that have surfaced in the 24 hours since the story broke. Hope you’re ready to dive in to it all.
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Depleted batteries. Unauthorized GPS tracking. $40,000 service bills. Rejected warranty claims. These are just some of the talking points making the rounds of the internet regarding the alleged “bricking” of Tesla Roadsters.
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TTAC officially retired its Tesla Deathwatch series over a year ago, after the firm delivered its 100th Roadster. Indeed, we’ve generally turned away from the “Deathwatch” tag in recent months, as the bankruptcies of GM and Chrysler have removed the immediacy of many of their original criticisms. Over the years, the Deathwatch label has been a challenging mistress, often confusing readers as to TTAC’s intentions: though they were intended to document the slow-motion bellyflop of America’s automakers, they’ve often been interpreted as a sign that TTAC actually wishes tragedy upon the automakers it identifies as being in danger of shuffling off this mortal coil. Incidents like the one today, in which three Tesla employees were apparently killed when an light aircraft owned by Tesla senior electrical engineer Doug Bourn crashed into a Palo Alto neighborhood, serve as an important reminder that nothing could be further from the case. TTAC criticizes automakers because responsibly buying, owning and operating motor vehicles requires that consumers be well-armed with the facts. When real tragedy strikes the companies that build the vehicles we discuss here, our thoughts go out to the families of those lost, and we hope that the company’s operations soon return to some semblance of normality. Today we mourn for Tesla’s as-yet unidentified employees (apparently CEO Elon Musk was not on board) who will not be at work tomorrow, working on new ways to respond to criticisms and improve the firm’s products.
Yes, yes: I’m a Tesla naysayer. Have been right from the start when the media went ape shit for a car that hadn’t been built, repeating performance claims as if they were written on Moses’ stone tablets. (Which were eventually modified.) But I did take them off the “Tesla Birth Watch” when the car deliveries began. And we haven’t posted a “Tesla Death Watch” entry since May 1, 2009. If true, this report from TechCrunch—claiming profitability for the EV maker—indicates that we should cancel the TDW altogether. Cynic that I am, I see some pretty major caveats here. “Silicon Valley’s electric car company, Tesla Motors, says that it hit profitability in July. The private company reports that it made ‘approximately $1 million of earnings’ on revenues of $20 million, and that it shipped 109 Roadsters, its $109,000 all-electric sports car. The revenues reflect GAAP accounting standards and are only for the month of July.” Given that GM used a predicted (but not realized) Department of Energy (DOE) loan in their financial projections, does Tesla’s half billion dollar-or-so DOE suckle have anything to do with this?
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And that’s just the prototype. The LA Times‘ Dan Neil (the automotive journalist’s automotive journalist) got an exclusive first up-close look at Tesla’s Model S and comes away with some healthy skepticism. What did he learn? “Tesla has already had to walk back a claim regarding the Model S’ recharge capacity. The car will not have the capacity to accept 440-volt current, which would allow it to be charged in 45 minutes,” for one thing. The prototype “is just barely ambulatory,” writes Neil. “More like a glorified golf cart than a harbinger of tomorrow tech.” Also, “the car’s signature design flourish—a 17-inch, touch-screen control panel with haptic feedback in the center console —may not even make it to production.” And Neil’s skepticism is contagious: The Business Insider concludes that “There’s No Way Tesla’s Model S Will Cost $57,400” even after hefty government incentives. Ouch.
Now you may think that Tesla Motors, makers of the $109K+ lithium-ion powered Roadster, are acting in good faith re: taking deposits for their recently revealed Model S sedan. If so, GreenTech Media’s report that the Musk-scented company has secured 520 advance orders for the vehicle is a good thing: a sign of early adopters’ faith in Tesla’s ability to design, build and, eventually, sell the all-electric foor-door. Leaving aside Tesla’s past history of missing deadlines and changing announced specifications. With eyes wide shut, the fact that Tesla has collected $5K per car from 520 prospective customers, generating some $2.6M, is a good thing. Nothing wrong with raising a little—and in the car business $2.6 million is microscopic—working capital. The fact that Tesla’s first model, the Roadster, isn’t profitable, and that the new money may be helping to prop-up THAT side of the business, is neither here nor there nor the subject of a court case. So . . . good news! There may be more money on Tesla’s table!
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The racing biz has been trying to go green for nearly a decade now, realizing that sheer horsepower and derring-do don’t conform to the temper of the times. The new mantra: race on Sunday, save the planet on Monday (after breakfast on my yacht). So the idea of a one-make Tesla Roadster race series makes perfect sense: from a political point of view. As Tesla never met a trail balloon it couldn’t inflate with hot air, it’s no surprise that Tesla communictions manager Rachel Konrad gave the [we swear it’s not an April fool’s] idea her tacit support. “The Roadster’s acceleration certainly makes it competitive against other premium sports cars, so it’s not surprising that some customers are interested in competitions.” Yes, well, as Pistonheads points out, racing Roadsters would require a bit more development work. “However, there may be a few barriers to this new form of ‘green motorsport’. Continual hard driving may force the Tesla’s motor to overheat, causing a loss of power that wouldn’t make for very exciting racing. Races would also have to be kept to short sprint events, as a Le Mans-style 24-hour race would no doubt be made up of more battery charging than racing.” Oh, sure, NOW they piss on them . . .
Looks like we may have retired the Tesla Deathwatch a bit prematurely. Valleywag reports that Tesla CEO Elon Musk has launched a Nixonian “plumber” offensive aimed at eliminating leaks from the Silicon Valley startup. And boy are the employees happy about it. The plumb-and-purge strategy was launched when Tesla engineer Peng Zhou told Valleywag that the company’s cash reserves had dropped to $9M. According to the blog, Musk “hired an outside IT contractor go through the company’s email and instant messages, and then had an investigator take fingerprints off a printout discarded near a copier used to leak the email.” That investigation implicated Zhou who was asked to confess, apologize and leave the company. This was just the beginning.
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Gawker reports that Tesla spinmeister Daryl Siry left the Silicon Valley startup because CEO Elon Musk (above) was pushing to accept deposits on the Model S sedan. The Model S (a.k.a. WhiteStar) exists only as a prototype. Tesla has no factory or financing with which to build it. When Musk announced that the DOE would approve Tesla’s loan application (they haven’t and likely won’t) and decided to accept $40K Model S deposits (next month), Siry smelled fraud and bailed. Valleywag calls Musk “The New Preston Tucker,” revealing that Musk told a recent Tesla “town hall” meeting that Tesla deposits were not guaranteed. This despite earlier assurances that Musk would personally guarantee deposits. With reports of Tesla asking for up to $75K in unescrowed “reservation payments,” and difficulty reclaiming deposits as small as $5K, Siry’s fears were probably well-founded. Meanwhile, anecdotal evidence from Tesla forums indicates that the real winner here: the Fisker Karma.
It can be so hard to tell when the firm’s CEO is so notoriously at odds with reality. So let’s just say that we’re entering Elon Musk’s world, grains of salt available upon request. In fact, the news comes from a Musk email that Jason Calcanis has posted verbatim to his blog (cross posted at Tesla Motors). The main point of the email seems to be to convince the reader that Tesla isn’t about to disappear with the credit market, citing a deal with Daimler to electrify the Smart, a $40m investment round and the near sellout of all 2009 Roadsters. Even better, if you lay out $100k for a Roadster now, you might just have a new cashflow opportunity to get you through the hard times. “Due to our order backlog, it seems that owning a Roadster can be a good investment,” writes Musk. “Last September, as the financial and real estate markets began crashing, a Roadster was sold at the Sonoma Paradiso in California wine country for $160,000, well above the current list price of $109,000.” And if you buy that, I’ve got some mortgage-backed structured invesment vehicles that you might be interested in. But the big news is that Tesla may or may not get funding from the biggest sucker of them all: the US Federal Government. Or not. (Hat Tip: minion444)
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