The agency said its safety investigation was prompted by recent “undercarriage strikes” in Washington state and Tennessee. In both cases, fires resulted after the cars both ran over debris on the road that pierced the battery compartment. After news of the probe broke, Tesla shares fell to $116 in pre-market trading but climbed back once the market opened. Tesla shares were trading up $5.87, or 4.7%, to $127.43 in the first hour of trading.
Early Tuesday before NHTSA’s announcement, Tesla CEO Elon Musk announced that he taking three steps as a result of the fires, but added that he stands behind their safety. The steps were:
•Higher ground clearance to make them less likely to strike road debris that can potentially penetrate the battery pack and ignite a blaze.
•Asking federal safety regulators to “conduct a full investigation as soon as possible into the fires.” Musk gave no hint that NHTSA was about to open an investigation.
•Amending the cars’ warranty to cover damage due to fire.