Trouble for Tesla: Why Consumer Reports Says Its Model S Was ‘Undriveable’

Trouble for Tesla: Why Consumer Reports Says Its Model S Was ‘Undriveable’

The Tesla logo is seen on a Tesla Model S P85D outside the company's headquarters in Palo Alto, California April 30, 2015. REUTERS/Elijah Nouvelage
© Elijah Nouvelage / Reuters
By Jonathan Berr

Consumer Reports in 2013 gave the Telsa Model S the highest rating of any vehicle in its history. This year’s review did not go as well for Elon Musk’s company.

The venerable magazine had to delay testing of the company’s newest model because its drivers couldn’t open the doors on the $127,000 sedan, temporarily making the car “undriveable.”

The door handles on the Model S P85 retract automatically and lay flush against the vehicle when they are not in use. Once the vehicle receives a signal from the key fob, the handles move to allow people to grip them. Unfortunately, the door handles stopped working after Consumer Reports testers had the vehicle for 27 days and had driven just over 2,300 miles.

That malfunction caused other problems, the magazine says: “[S]ignificantly, the car wouldn't stay in Drive, perhaps misinterpreting that the door was open due to the issue with the door handle.”

Consumer Reports’ troubles aren’t unique. The non-profit’s car reliability survey found that the Model S has had a far higher than average number of problems with doors, locks and latches, according to the organization’s website.

The testing experience wasn’t all bad, though, because the automaker’s customer service is top notch. A technician was sent to the Consumer Reports Auto Test Center the morning after the problem was reported and quickly diagnosed the problem.

“Our car needed a new door-handle control module — the part inside the door itself that includes the electronic sensors and motors to operate the door handle and open the door,” Consumer Reports says.  “The whole repair took about two hours and was covered under the warranty.”

Eric Lyman, vice president of industry insights at TrueCar, told The Fiscal Times that the speed in which Tesla addressed that issue will earn it more kudos from customers who have seen carmakers drag their feet in making needed repairs.  The door handle issue isn’t a big deal, he said.

“Telsa is still a relatively new automaker,” he said. “The reality is that we see this kind of thing happen all of the time. This is pretty normal in the course of business in the auto industry.”

The timing of the mishap comes as Telsa is struggling to repair its credibility with Wall Street after the electric vehicle maker’s disappointing earnings performance.  Bloomberg News reported last week that the Palo Alto, Calif.-based company might have to raise money because of what one analyst described as its “eye watering” cash burn rate, or else it might run out of money in the next three quarters.

The electric vehicle maker also is facing increased competition from more established rivals. General Motors (GM), for instance, recently unveiled a Chevrolet Bolt concept car that is set to hit the market in 2017 with a projected price of about $30,000 and a battery range of 200 miles. The next generation Nissan Leaf, another electric vehicle, will hit the market at about the same time.

For now, Tesla’s biggest challenge may in convincing consumers to buy electric vehicles while oil remains cheap.

GOP Tax Cuts Getting Less Popular, Poll Finds

A congressional aide places a placard on a podium for the House Republican's legislation to overhaul the tax code on Capitol Hill in Washington
JOSHUA ROBERTS/Reuters
By The Fiscal Times Staff

Friday marked the six-month anniversary of President Trump’s signing the Republican tax overhaul into law, and public opinion of the law is moving in the wrong direction for the GOP. A Monmouth University survey conducted earlier this month found that 34 percent of the public approves of the tax reform passed by Republicans late last year, while 41 percent disapprove. Approval has fallen by 6 points since late April and disapproval has slipped 3 points. The percentage of people who aren’t sure how they feel about the plan has risen from 16 percent in April to 24 percent this month.

Other findings from the poll of 806 U.S. adults:

  • 19 percent approve of the job Congress is doing; 67 percent disapprove
  • 40 percent say the country is heading in the right direction, up from 33 percent in April
  • Democrats hold a 7-point edge in a generic House ballot

Special Tax Break Zones Defined for All 50 States

Workers guide steel beams into place at a construction site in San Francisco, California September 1, 2011.  REUTERS/Robert Galbraith
© Robert Galbraith / Reuters
By Michael Rainey

The U.S. Treasury has approved the final group of opportunity zones, which offer tax incentives for investments made in low-income areas. The zones were created by the tax law signed in December.

Bill Lucia of Route Fifty has some details: “Treasury says that nearly 35 million people live in the designated zones and that census tracts in the zones have an average poverty rate of about 32 percent based on figures from 2011 to 2015, compared to a rate of 17 percent for the average U.S. census tract.”

Click here to explore the dynamic map of the zones on the U.S. Treasury website. 

Map of the Day: Affordable Care Act Premiums Since 2014

FILE PHOTO: A sign on an insurance store advertises Obamacare in San Ysidro
MIKE BLAKE
By The Fiscal Times Staff

Axios breaks down how monthly premiums on benchmark Affordable Care Act policies have risen state by state since 2014. The average increase: $481.

Obamacare Repeal Would Lead to 17.1 Million More Uninsured in 2019: Study

A small group of demonstrators stand outside of of a hotel before former South Carolina Senator Jim DeMint, president of the The Heritage Foundation, speaks at a "Defund Obamacare Tour" rally in Indianapolis, Indiana, U.S.  August 26, 2013.  REUTERS/Nate
© Nathan Chute / Reuters
By The Fiscal Times Staff

A new analysis by the Urban Institute finds that if the Affordable Care Act were eliminated entirely, the number of uninsured would rise by 17.1 million — or 50 percent — in 2019. The study also found that federal spending would be reduced by almost $147 billion next year if the ACA were fully repealed.

Your Tax Dollars at Work

White House Office of Management and Budget Director Mick Mulvaney speaks about the budget at the White House in Washington
REUTERS/Kevin Lamarque
By Michael Rainey

Mick Mulvaney has been running the Consumer Financial Protection Bureau since last November, and by all accounts the South Carolina conservative is none too happy with the agency charged with protecting citizens from fraud in the financial industry. The Hill recently wrote up “five ways Mulvaney is cracking down on his own agency,” and they include dropping cases against payday lenders, dismissing three advisory boards and an effort to rebrand the operation as the Bureau of Consumer Financial Protection — a move critics say is intended to deemphasize the consumer part of the agency’s mission.

Mulvaney recently scored a small victory on the last point, changing the sign in the agency’s building to the new initials. “The Consumer Financial Protection Bureau does not exist,” Mulvaney told Congress in April, and now he’s proven the point, at least when it comes to the sign in his lobby (h/t to Vox and thanks to Alan Zibel of Public Citizen for the photo, via Twitter).