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.

It’s Official: No Government Shutdown – for Now

iStockphoto/The Fiscal Times
By The Fiscal Times Staff

President Trump signed a short-term continuing resolution today to fund the federal government through Friday, December 22.

Bloomberg called the maneuver “a monumental piece of can kicking,” which is no doubt the case, but at least you’ll be able to visit your favorite national park over the weekend.

Here's to small victories!

Greenspan Has a Warning About the GOP Tax Plan

Alan Greenspan
REUTERS/Kevin Lamarque
By Michael Rainey

The Republican tax cuts won’t do much for economic growth, former Federal Reserve Chair Alan Greenspan told CNBC Wednesday, but they will damage the country’s fiscal situation while creating the threat of stagflation. "This is a terrible fiscal situation we've got ourselves into," Greenspan said. "The administration is doing tax cuts and a spending decrease, but he's doing them in the wrong order. What we need right now is to focus totally on reducing the debt."

The US Economy Hits a Sweet Spot

iStockphoto
By The Fiscal Times Staff

“The U.S. economy is running at its full potential for the first time in a decade, a new milestone for an expansion now in its ninth year,” The Wall Street Journal reports. But the milestone was reached, in part, because the Congressional Budget Office has, over the last 10 years, downgraded its estimate of the economy’s potential output. “Some economists think more slack remains in the job market than October’s 4.1% unemployment rate would suggest. Also, economic output is still well below its potential level based on estimates produced a decade ago by the CBO.”

The New York Times Drums Up Opposition to the Tax Bill

FILE PHOTO: People line up for taxi across the street from the New York Times head office in New York
Carlo Allegri
By The Fiscal Times Staff

The New York Times editorial board took to Twitter Wednesday “to urge the Senate to reject a tax bill that hurts the middle class & the nation's fiscal health.”

Using the hashtag #thetaxbillshurts, the NYT Opinion account posted phone numbers for Sens. Susan Collins, Bob Corker, Jeff Flake, James Lankford, John McCain, Lisa Murkowski and Jerry Moran. It urged readers to call the senators and encourage them to oppose the bill.

In an editorial published Tuesday night, the Times wrote that “Republican senators have a choice. They can follow the will of their donors and vote to take money from the middle class and give it to the wealthiest people in the world. Or they can vote no, to protect the public and the financial health of the government.”

Like what you're reading? Sign up for our free newsletter.

Can Trump Succeed Where Mnuchin and Cohn Have Flopped?

U.S. Treasury Secretary Steven Mnuchin smiles during the 2017 Institute of International Finance (IIF) policy summit in Washington
REUTERS/Yuri Gripas
By The Fiscal Times Staff

President Trump met with members of the Senate Finance Committee Monday and is scheduled to attend Senate Republicans’ weekly policy lunch and make a personal push for the tax plan on Tuesday. Will he be a more effective salesman than surrogates in his administration?

Politico’s Annie Karni and Eliana Johnson report that both Democrats and Republicans say Mnuchin and chief economic adviser Gary Cohn have repeatedly botched their tax pitches, “in part due to their own backgrounds” as wealthy Goldman Sachs alums. “House Speaker Paul Ryan earlier this month asked the White House not to send Mnuchin to the Hill to talk with Republican lawmakers about the bill, according to two people familiar with the discussions — though Ryan has praised the Treasury secretary’s ability to improve the legislation itself,” Karni and Johnson write.