Deliveries of 14,370 vehicles trailed a projection of about 17,000, after an “extreme production ramp” came too late in the quarter to get the cars to their buyers, Tesla said Sunday. That has spurred questions – including in an article by Fortune magazine – over whether the company and regulators should have informed the public earlier of the fatality.
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Tesla is also contending with investor fallout after its $2.86 billion all-stock offer to acquire SolarCity Corp. last month.
Although no definitive conclusion has been drawn, it seems plausible that Baressi was watching a movie rather than the road ahead at the time of the crash. On May 16 the company disclosed the accident to the government, Reuters said. “This is highly unusual for an automaker, considering this model was launched in” the third quarter.
NHTSA spokesman Bryan Thomas said the investigation was “active” and the agency would not comment further.
Tesla shares fell more than 3 percent during early morning trading. “More than a million people die globally every year in vehicle accidents, but automakers do not disclose each of these accidents to investors, let alone before those investigations are complete and without regard to what the results of those investigations end up being”. “The market apparently understands this”, she said. Tesla shares moved just slightly lower on Tuesday, toward $209.
Incidentally, we recently highlighted how a simple truck design tweak involving side guards could have perhaps prevented the fatal Tesla Model S crash. While the press was flooded with negative articles about the accident (I counted an average of 2-4 articles per day in the Wall Street Journal and on Bloomberg), and the news ended up being reported 2 days in a row in the national news broadcast of all major networks, Wall Street traders shrugged the bad news off completely.
To put things baldly, Tesla and Musk did not disclose the very material fact that a man had died while using an auto-pilot technology that Tesla had marketed vigorously as safe and important to its customers.
“Those are issues that investors want to know, so you could make a reasonable argument that it crossed the (materiality) line”.
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Inc. has reached out to Tesla for comment and will update if the company responds.
