Tesla's Updates Warranty Now Covering Fire Damage
Tesla stock for 2013 has been on quite the roller coaster. From sky rocketing to over $180 and back down to $120 mostly due to panic in the media, CEO Elon Musk, has addressed each concern and continues to do so with direct correspondence. You won't find this at every company either. The last person I remember clearly addressing consumer outcry was Steve Jobs inviting media to Apple's campus when he confronted the iPhone 4's "Antennagate" issue. Here are some clear facts about fires and automobiles.
There are now substantially more than the 19,000 Model S vehicles on the road that were reported in our Q3 shareholder letter for an average of one fire per at least 6,333 cars, compared to the rate for gasoline vehicles of one fire per 1,350 cars. By this metric, you are more than four and a half times more likely to experience a fire in a gasoline car than a Model S! Considering the odds in the absolute, you are more likely to be struck by lightning in your lifetime than experience even a non-injurious fire in a Tesla.
Those metrics tell only part of the story. The far more deadly nature of a gasoline car fire deserves to be re-emphasized. Since the Model S went into production mid last year, there have been over 400 deaths and 1,200 serious injuries in the United States alone due to gasoline car fires, compared to zero deaths and zero injuries due to Tesla fires anywhere in the world.
There is a real, physical reason for this: a gasoline tank has 10 times more combustion energy than our battery pack. Moreover, the Model S battery pack also has internal firewalls between the 16 modules and a firewall between the battery pack and passenger compartment. This effectively limits the fire energy to a few percent that of a gasoline car and is the reason why Dr. Shibayama was able to retrieve his pens and papers from the glove compartment completely untouched after the recent fire (caused by a high speed impact with a tow hitch). It is also why arsonists tend to favor gasoline. Trying to set the side of a building on fire with a battery pack is far less effective.
For the final kicker and HUGE bonus to Tesla owners, Elon Musk goes on amending the warranty to even cover fire damage!
Third, to reinforce how strongly we feel about the low risk of fire in our cars, we will be amending our warranty policy to cover damage due to a fire, even if due to driver error. Unless a Model S owner actively tries to destroy the car, they are covered. Our goal here is to eliminate any concern about the cost of such an event and ensure that over time the Model S has the lowest insurance cost of any car at our price point. Either our belief in the safety of our car is correct and this is a minor cost or we are wrong, in which case the right thing is for Tesla to bear the cost rather than the car buyer.
For the complete "Mission of Tesla" head on over to Tesla's Blog. The closer and closer it gets to the Model X launch, the more and more I am inclined to bet that it'll win all SUV awards! Can't wait to get my hands on one. Forget minivans!
