Tesla Model S Loses Consumer Reports Recommendation, Shares Drop
PALO ALTO (CBS SF) – Shares of Palo Alto-based electric car maker Tesla Motors dropped nearly 7 percent on Tuesday, after Consumer Reports raised questions about reliability of the Model S sedan.
After starting the day at $228.10 a share, Tesla stock closed at $213.03 Tuesday, down $15.07 or 6.61 percent. Shares nearly dropped 10 percent in trading before recovering.
Consumer Reports dropped its recommendation for the Model S after receiving reports from 1,400 owners. Model S drivers reported issues in several areas, including the drivetrain, charging equipment, and the large screen center console, along with leaky sunroofs.
Last year, the magazine predicted "average" reliability for the Model S.
While owners reported problems, they also told the magazine that Tesla has been prompt in fixing issues and that 97 percent said they would buy their cars again.
Earlier this year, Consumer Reports gave high marks to the all-wheel-drive Tesla Model S P85D, giving it the highest rating among any vehicle they ever tested.
Tesla released their long-awaited Model X SUV last month. Last week, the car maker unlocked self-driving features in 60,000 vehicles through a software update.