By on August 21, 2019


No, Walmart was not using fleets of pricey electric vehicles to get 56-cents-a-pound bananas to budget-conscious shoppers; rather, the chain had outfitted a slew of its stores with rooftop solar panels assembled and managed by Tesla subsidiary SolarCity.

Now Walmart’s feeling burned. Literally.

Following rooftop blazes at at least seven stores and a recent investigation, the shopping giant filed a lawsuit against Tesla on Tuesday, alleging the company “engaged in widespread, systemic negligence and had failed to abide by prudent industry practices in installing, operating, and maintaining its solar systems.”

Walmart’s relationship with SolarCity goes back a number of years; a trio of earlier fires in 2012, 2016, and 2017 were brushed off as random flukes. Then the fires began occurring with greater frequency.

In a suit filed to the Supreme Court of the State of New York (New York County), Walmart describes three fires in 2018 — March 7th in Beavercreek, Ohio, May 21st in Denton Maryland, and May 29th in Indio, California — and asks the question, “Why were multiple Walmart stores located all over the country suddenly catching fire?”

Walmart’s answer? “The stores all had Tesla solar panels installed by Tesla on their roofs. At each location, the fire had originated in the Tesla solar panels.”

In total, Walmart leased or licenced roof space on 240 of its stores to Tesla for the installation of solar energy systems designed to lower Walmart’s utility bills. Under the deal, Tesla retained ownership of the systems. Following the early-2018 fires, Walmart asked Tesla to “de-energize” its stores. The solar arrays went dark on May 31st, but that didn’t stop a small fire from breaking out in November 2018 on a Walmart roof in Yuba City, California. Wires were still sparking when employees discovered it, Walmart claims.

“To this day, Tesla has not provided Walmart with the complete set of final “root cause” analyses needed to identify the precise defects in its systems that caused all of the fires described above,” the suits reads. “The number of defects, however, is overwhelming and plainly indicative of systemic, widespread failures by Tesla to meet the standard of care, as set forth in the governing contracts, as to the solar systems installed at Walmart’s stores.”

An investigation launched in December 2018 turned up numerous “hotspots” and “dangerous wire connection practices,” the retailer states. Loose, hanging, and abraded wires were not in short supply, it continued, and many systems were not properly grounded.

This was all evidence of “widespread negligence,” Walmart claims, alleging that “SolarCity had adopted an ill-considered business model that required it to install solar panel systems haphazardly and as quickly as possible in order to turn a profit, and the contractors and subcontractors who performed the original installation work had not been properly hired, trained, and supervised.”

In purchasing SolarCity, Walmart claims, Tesla failed to reform the company’s “chaotic installation practices” and failed to keep proper documentation relating to the systems. Still, the two companies moved forward with an aim to re-energize the stores. Clearly, that did not end up happening. A follow-up investigation by Tesla in 2019 reportedly uncovered 157 action items, 48 of which posed a safety threat or potential safety threat, across 29 inspection reports.

At that point, the two companies found themselves at loggerheads. Despite assurances from Tesla, Walmart says it felt its green energy partner was not up to the task of safely managing the solar systems.

“In light of Tesla’s breaches of the contracts, Walmart now seeks a declaration that Tesla has breached its contractual obligations and recovery of the out-of-pocket costs and other contractual payments that Tesla has refused to pay, along with any other damages and relief that this Court deems just and proper,” the retailer states.

Tesla purchased SolarCity, a company founded by CEO Elon Musk’s cousin, in 2016, with Musk serving as the company’s chairman and largest stockholder. The company has since undergone layoffs and seen the closure of installation facilities as it grapples with money issues.

[Image: Walmart]

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23 Comments on “All Fired Up: Walmart Sues Tesla...”

  • avatar

    And everyone thought the biggest financial threat to Tesla came from other automakers…

  • avatar

    I love the idea of solar panels that mimic the look of residential roof shingles, but I assume these are more traditional roof mount large panels. Is it the battery storage system that caught fire?
    This ars Technica article makes it pretty clear that the panels themselves are burnt to a crisp. And that the problems start at the roof panels and connections themselves.

  • avatar

    I certainly do enjoy it when people who sell out to the green energy charlatans get burned. Natural gas used to be called clean energy, but then the misanthropes of the watermelon scheme learned that it was plentiful and cheap. Fracking is less damaging than mining battery materials or putting up wind and solar plants that take birds out of the sky with spinning blades and searing heat. The only difference is that one won’t hurt humans by pricing them out of their lifestyles while the other two will hasten the end of the middle class. Burn baby burn.

    • 0 avatar

      Agreed, Todd. This stuff is “feel-good” nutty and a cash cow for a select few (who continue to private jet their way across the world).

    • 0 avatar
      Art Vandelay

      Additionally with respect to petroleum we are a net exporter. Battery tech relies on dirty mining that takes place largely in China. Why would we further expose our economy to the whims of China after spending the last several decades extracting it from the whims of OPEC and the rest of the middle east. Are we going to hear cries of “no war for Lithium” in the future? I’d rather not.

  • avatar

    Tesla fans are trying to sell the story that this was sabotage by WM because the Walton family isn’t “progressive” enough. My take is that no way is any WM exec going to sign off on a plan that potentially kills a lot of customers and when discovered as it surely would be gets them a long stint in the slammer.

    If you read the lawsuit filings, this is typical Tesla, good concept with terrible execution / bad quality. Technicians / laborers who don’t have the ability to do even a basic installation correctly. WM has a ton of evidence from hired experts and fire dept investigators about the flaws in the installations.

    It appears Musk has chosen to stand and fight on this suit, despite what appears to be a very weak case, because a settlement with WM would likely result in a huge recall of Solar City installs all over the world.

    • 0 avatar

      So it sounds like the panels themselves are okay, but the third-party installers are idiots. Are these installers “trained” by Tesla?

    • 0 avatar

      Electrical fires like this are typically from connections with excessive resistance. As the current flow increases so does the temperature of the poorly made connections. A “thermal event” is pretty much a given at that point, though if the materials are self-extinguishing, the fires often die out when the connection burns to the point where there is no longer any current flow. Typical examples people might see are when they plug a high current device (a portable heater or, recalling early Chevy Volt charging fires, an electric car) into an extension cord or a worn receptacle. Over time the connection overheats. The idea that WM would sabotage the equipment because they are not “progressive” enough is ludicrous (no pun intended). If they were that backward-thinking they would not even entertain installing such equipment, instead, they would blame wind turbines for killing birds when the number one killer of birds are those ugly, highly energy inefficient glass buildings that blight our country. House cats, number two.

      Big box stores with vast roof areas are perfect examples of where properly installed solar equipment work best. Unless, it is a Tesla setup…

    • 0 avatar

      The Walton family were investors in Solyndra – so they obviously are plenty progressive and have the financial losses to prove it.

      • 0 avatar

        They have also been big pushers of high fuel economy trucks for deliveries. Make lots of bets, write off your losers and cash in on your winners. I don’t shop Walmart (I do return my used oil there) but they seem to have made more winning bets than losing bets.

    • 0 avatar
      Art Vandelay

      “Tesla fans are trying to sell the story that this was sabotage by WM because the Walton family isn’t “progressive” enough.”

      That is a scary level of nutty devotion by those fans. It goes beyond cult like.

  • avatar

    I looked at a consumers complaint/review site. You never can tell the true ratio of dissatisfied to satisfied consumers there are, but the site rating was 1 star out of 5. Comments included using regular roofers to install the system. I paid for a lot of college installing shingle roofing and a lot of the guys I worked with couldn’t be trusted with more than a hammer and stuff sturdy enough to withstand said hammer.

  • avatar

    What next? I suppose now they will tell us that the solar panel covered road in France is a total fiasco, or that electricity prices are sky high in Spain, Germany, California, and Australia because of all that “free” solar power.

  • avatar

    costco is more than happy to stay 5-10 years behind the times and let other stores do the beta testing. theoretically, roofs should be cheaper if there are solar panels on top of them to take the brunt of the elements.

  • avatar

    This is so disappointing. Tesla’s frauds and failures may go down in history as the worst thing that ever happened to alternative energy. Even more than Trump is trying to do. Every flat big-box store should have these panels, taking advantage otherwise wasted space. It’s like finding free land, including nearby electrical demand. Installing flat panels on flat roofs outright to be the simplest task, but Tesla found a way to both this.

    • 0 avatar

      “Tesla’s frauds and failures may go down in history as the worst thing that ever happened to alternative energy.”

      Hi there. Remember me?
      – Solyndra

      • 0 avatar

        Soylandra was a failed start-up that lost $500K, right? They were one of many panel manufacturers. Musk’s cars have dominated the luxury car market. Solar City was a big deal, too, and his powerwall batteries… if they worked. And Musk’s public mindshare has been enormous. When he fails, it makes a big splash. But all these technologies are essential to maybe not your future, but the following generations.

        But nobody wants to face this seriously. And this is the carefree dog days of August. Ya’ll throw another lump of coal in the fireplace fireplace, ya hear?

  • avatar

    I generally loathe Tesla and the Muskrat, but do have some admiration ONLY for the Tesla batteries and the Powerwall system. I do believe that there is a place for solar in new construction in climates where it makes sense (not in Seattle). It would seem that it would be prudent for anyone building a new building in an appropriate climate to install solar from day one. Integrate it and maximize the installation and make it the most affordable it can be. But I am strongly against laws that would force adding solar anywhere. To me it seems foolish not to install solar on new buildings because the cost has come down so much.

    This particular example is unsettling because these people are supposed to know what they are doing and if they are committing short cuts, they should be punished severely (fried by focused solar energy) (sarcasm).

    • 0 avatar

      I live in Seattle, and have a friend who has solar panels on his house. They paid for themselves a long time ago and cover well over 100% of his electricity usage. At current panel prices it is a no-brainer, and if I have the budget I’ll do it next time I replace my roof.

  • avatar

    Where were the local electrical inspectors when SolaCity/Tesla installed this rubbish? Badly torqued bolts and bad connections?

    Not living in the US I don’t know if you have electrical inspection to a national code. The local inspectors here went over my friend’s roof installation with a fine tooth comb.

    It kind of sounds like Walmart did a deal with SolarCity where nobody bothered to register these installations with local authorities. Like experimental aircraft or something. In which case it was encumbent on Walmart to employ competent consultants to oversee the installations on their behalf.

    Amateur hour all around by the sound of it.

  • avatar
    Pete Zaitcev

    Poetic justice for Elon who could not let his pet project crash, so he made Tesla “buy” Solar City instead. This is what happens when business is governed by feels.

  • avatar

    Wal-Mart buys and runs hordes of trucks. Tesla trying to make a truck last I heard (is that thing officially vaporware yet?). Bad look for Tesla to one of their biggest possible customers for the truck.

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