Headlines About Model S Fires 'Misleading' - Musk (TSLA)
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On the defensive from three recent Model S fires, Tesla (NASDAQ: TSLA) CEO Elon Musk batted down rumors of a recall today in a DealBook Conference interview.
Musk said there will "definitely" not be a Model S recall and said the response to the fires has been unreasonable. While the headlines would suggest that the Model S has a greater propensity to catch fire, the opposite is true. Musk explains that in gasoline-powered cars there is a 1 in 1300 chance for a fire, while it is 1 for 8000 for the Model S.
He said there has never been a serious injury or death in any of their cars. In all three cases the drivers believed the Model S protected them from harm, which wouldn't have been the case in other vehicles. He said the driver in the 2nd fire would have probably been dead if not for the car. The car crashed into a brick barrier at an impact that was four times the maximum kinetic energy a car crash is supposed to be survivable at. The driver and passengers all walked away safely,
Musk uses a Titantic analogy to drive home his point about mis-reporting of the story. "Let's say the Titantic, instead of sinking... smashed through the first iceberg, smashed through the second iceberg, came to an rest on the third iceberg, all the passengers disembarked safety and bought another ticket. Then the newspaper report was "Kitchen fire on the Titantic."
On the stock price, Musk said the high stock price has been "somewhat distracting." Musk recalls he went on record saying that the price was higher than they had any right to deserve; although he believes the value of the company will be well in excess of that in the future. The current valuation has a lot of faith in future execution, he explains, and they will do their best to meet that faith. He said he doesn't believe in talking up the stock, and wasn't trying to talk it down in the past. He said the stock is a pretty good deal where it is right now, but was probably a bit too high before.
On George Clooney comments about his Tesla breaking down, Musk said the comments were "needless" and "needlessly reported". Musk notes that Clooney had a Roadster that has since been discontinued.
Musk said the Model S is not demand constrained but production constrained.
He predicts that in the long-term all forms of transportation will be electric. On self-driving cars he said eventually they will be safer than person-driven cars.
Musk said there will "definitely" not be a Model S recall and said the response to the fires has been unreasonable. While the headlines would suggest that the Model S has a greater propensity to catch fire, the opposite is true. Musk explains that in gasoline-powered cars there is a 1 in 1300 chance for a fire, while it is 1 for 8000 for the Model S.
He said there has never been a serious injury or death in any of their cars. In all three cases the drivers believed the Model S protected them from harm, which wouldn't have been the case in other vehicles. He said the driver in the 2nd fire would have probably been dead if not for the car. The car crashed into a brick barrier at an impact that was four times the maximum kinetic energy a car crash is supposed to be survivable at. The driver and passengers all walked away safely,
Musk uses a Titantic analogy to drive home his point about mis-reporting of the story. "Let's say the Titantic, instead of sinking... smashed through the first iceberg, smashed through the second iceberg, came to an rest on the third iceberg, all the passengers disembarked safety and bought another ticket. Then the newspaper report was "Kitchen fire on the Titantic."
On the stock price, Musk said the high stock price has been "somewhat distracting." Musk recalls he went on record saying that the price was higher than they had any right to deserve; although he believes the value of the company will be well in excess of that in the future. The current valuation has a lot of faith in future execution, he explains, and they will do their best to meet that faith. He said he doesn't believe in talking up the stock, and wasn't trying to talk it down in the past. He said the stock is a pretty good deal where it is right now, but was probably a bit too high before.
On George Clooney comments about his Tesla breaking down, Musk said the comments were "needless" and "needlessly reported". Musk notes that Clooney had a Roadster that has since been discontinued.
Musk said the Model S is not demand constrained but production constrained.
He predicts that in the long-term all forms of transportation will be electric. On self-driving cars he said eventually they will be safer than person-driven cars.
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