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Tesla Motors (TSLA) Responds to Accusations of Suspension Issues
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“A few things need to be cleared up about the supposed safety of Model S suspensions” is the first sentence written in blog post yesterday by Tesla Motor (TSLA - Free Report) in response to a report that it used non-disclosure agreements to downplay suspension problems with its Model S electric sedans.
The National Highway Traffic Safety Administration (NHTSA) said on Thursday that some Tesla customers who experienced suspension failures with their Model S sedans were asked to sign confidentiality agreements about the issue.
“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,” said Bryan Thomas, an agency spokesman, per the New York Times. “Tesla representatives told NHTSA that it was not their intention to dissuade consumers from contacting the agency.”
The blog post titled “Grain of Salt” discusses the true nature of these non-disclosure agreements, or “Goodwill Agreements,” according to Tesla. “When our customers tell us something went wrong with their car, we often cover it even if we find that the problem was not caused by the car and that we therefore have no obligations under the warranty” the post reads. These specific agreements are signed so that repairs it makes are not “used against us [Tesla] in court for further gain.”
However, the NHTSA described these NDAs as “troublesome” after confirming a report by blogger Edward Niedermayer, who initially reported on the Tesla's use of the non-disclosure agreements.
According to a report by Business Insider, Niedermayer said the NDAs “could restrict customers’ ability to report incidents to the NHTSA, something that Tesla vigorously denied.” Tesla responded to Niedermayer’s accusations with rather strong words. The electric car company notes that Niedermayer previously wrote an article titled “Tesla Death Watch” back in 2008, to which Tesla responded, “We just checked our pulse and, much to his chagrin, appear to be alive.”
“We don’t know if Mr. Niedermayer’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,” the blog post read, “but it is important to highlight that there are several billion dollars in short sale bets against Tesla.”
Tesla also wanted to mention that there are no safety defects with the suspensions in either the Model S or Model X as well as the NHTSA has not opened any investigation nor has it even started a preliminary evaluation into the matter.
Despite the clarifying blog post, Tesla stock was down 3.16% as of 11:46 AM ET. The electric car company has a Zacks Rank #4 (Hold).
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Tesla Motors (TSLA) Responds to Accusations of Suspension Issues
“A few things need to be cleared up about the supposed safety of Model S suspensions” is the first sentence written in blog post yesterday by Tesla Motor (TSLA - Free Report) in response to a report that it used non-disclosure agreements to downplay suspension problems with its Model S electric sedans.
The National Highway Traffic Safety Administration (NHTSA) said on Thursday that some Tesla customers who experienced suspension failures with their Model S sedans were asked to sign confidentiality agreements about the issue.
“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,” said Bryan Thomas, an agency spokesman, per the New York Times. “Tesla representatives told NHTSA that it was not their intention to dissuade consumers from contacting the agency.”
The blog post titled “Grain of Salt” discusses the true nature of these non-disclosure agreements, or “Goodwill Agreements,” according to Tesla. “When our customers tell us something went wrong with their car, we often cover it even if we find that the problem was not caused by the car and that we therefore have no obligations under the warranty” the post reads. These specific agreements are signed so that repairs it makes are not “used against us [Tesla] in court for further gain.”
However, the NHTSA described these NDAs as “troublesome” after confirming a report by blogger Edward Niedermayer, who initially reported on the Tesla's use of the non-disclosure agreements.
According to a report by Business Insider, Niedermayer said the NDAs “could restrict customers’ ability to report incidents to the NHTSA, something that Tesla vigorously denied.” Tesla responded to Niedermayer’s accusations with rather strong words. The electric car company notes that Niedermayer previously wrote an article titled “Tesla Death Watch” back in 2008, to which Tesla responded, “We just checked our pulse and, much to his chagrin, appear to be alive.”
“We don’t know if Mr. Niedermayer’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,” the blog post read, “but it is important to highlight that there are several billion dollars in short sale bets against Tesla.”
Tesla also wanted to mention that there are no safety defects with the suspensions in either the Model S or Model X as well as the NHTSA has not opened any investigation nor has it even started a preliminary evaluation into the matter.
Despite the clarifying blog post, Tesla stock was down 3.16% as of 11:46 AM ET. The electric car company has a Zacks Rank #4 (Hold).
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