Why the Tesla battery fire controversy is already ancient history

A few weeks ago, beloved 87-year-old actor Dick Van Dyke was pulled from his Jaguar XJ moments before the car burst into flames on the side of a Los Angeles freeway.

The next day, Van Dyke tweeted a photo of the burned-out husk of his car, joking “Used Jag for sale REAL CHEAP!!” The story made the news because of Van Dyke’s national treasure status, with an assist from his witty tweet.

But the fire wouldn’t have made the news at all if the car’s occupant had been a regular person. The National Fire Protection Association reported 187,500 car fires in the US in 2011 (steadily declining from 1980, which saw an incredible 465,000 reported car fires).

The only way Jaguar would have needed to become involved and stepped out in front of the bad publicity resulting from this story would have been if Van Dyke had burned to death in the XJ. As events transpired, the whole thing made for a mildly amusing human interest story on a slow news day, and the word “Jaguar” was not particularly associated with the incident in the mind of the public.

Last week, a Tesla Model S caught fire on a highway near Seattle after running over a metal object, impaling the car’s undercarriage and causing one of the car’s 16 battery modules to catch fire. A Youtube video of the burning Tesla shot by a passing motorist went viral over the coming days and was picked up by every news organization on the planet. Tesla’s shares immediately shed about $22 over the next 24 hours, but recovered on Friday to close at $180.98, less than 7% below the stock’s 52-week high of $194.50.

Tesla CEO Elon Musk reacted to the fire in a blog post, pointing out that regular combustion cars experience one fire for every 20 million miles driven while the Tesla now has 100 million miles of almost incident-free driving under its belt with its first and only fire. The affected car’s owner, Robert Carlson, was unharmed and furthermore stated in an email to Tesla “that the car performed very well under such an extreme test” and that he is “still a big fan of your car”. He has been offered a replacement loaner by the company in the meantime. Pretty impressive loyalty considering the steep price: the Tesla Model S comes in at a base price of $58,570 and can cost as much $106,570, fully loaded.

After achieving a rare perfect score from Consumer Reports in May and a 5-star safety rating from the National Highway Traffic Safety Administration, Tesla’s future seemed invincible. Share prices climbed to astronomical highs, and lingering doubts about the viability of the electric car as a mass-market option aimed at the average person more or less evaporated.

Time magazine lifts a non-malicious aside from Musk’s blog post in which he points out that although firefighters followed correct procedure for putting out a car fire, their actions actually ended up making the fire worse, and then pimped it into a full-length story suggesting that Musk “blames firefighters” for his car’s problems and further taunts him with a sub-headline that reads “Talk about passing the buck”.

Giorgio Rizzoni, director of the Center for Automotive Research at Ohio State University, said, “If you think about what you’d rather be close to, 10 gallons of gasoline or a battery pack, I’d pick the battery pack every day.”

The problem with a viral video, though, is that thinking about “what you’d rather be close to” in that situation kind of goes out the window. We still react in a very human way to the spectacle of something on fire. The spread of a viral video, furthermore, demonstrates how quickly a company’s fortunes, no matter how rock-solidly backed up by excellent performance and glowing reviews, can go up in smoke. Optics, for better or worse, are everything.

At the beginning of 2013, electric car manufacturer Fisker had about $1.2 billion of its own money to play with, in addition to a $200-million investment from the US Department of Energy. Today it flirts with insolvency. The bumps on Fisker’s road were supplied by a combination of bad optics (a Youtube fire), politics (Mitt Romney on the election trail calling Fisker and other companies that took DoE subsidies “losers”), bad management (unanticipated cost overruns), and bad luck (Super Storm Sandy destroying a good chunk of its fleet in a New Jersey warehouse). The company’s flagship model is, funnily enough, called the Karma.

The bad examples set by previous entrants in the great electric car pileup stand as an example that any company, no matter how well positioned, can end up on the scrapheap of history. A company can have everything going for it, a great product, wonderful reviews, a loyal fan base, everything, and still be ploughed under by optics and bad luck (cf. BlackBerry).

What’s apparent from watching the media pile-on that propelled the Tesla fire to the top of trending stories last week is that some folks have got it in for electric cars in general, and for Musk in particular.

What’s apparent from watching the media pile-on that propelled the Tesla fire to the top of trending stories last week is that some folks have got it in for electric cars in general, and for Musk in particular. You don’t have to be conspiracy minded to notice the tone of relish that many news reports have taken in posting “End of the Road for Tesla?” style clickbait scare headlines, while also noticing that they don’t hold other auto manufacturers to the same standard of ridicule when those cars catch fire.

Time magazine lifts a non-malicious aside from Musk’s blog post in which he points out that although firefighters followed correct procedure for putting out a car fire, their actions actually ended up making the fire worse, and then pimped it into a full-length story suggesting that Musk “blames firefighters” for his car’s problems and further taunts him with a sub-headline that reads “Talk about passing the buck”.

In an astonishing stitch-up job, the English auto show “Top Gear” appeared to depict their test driver Jeremy Clarkson (who is also a top-rated columnist for the Daily Mail) feigning surprise over a Tesla’s apparent sudden battery failure during a test drive that was scripted in advance. Then there was the infamous John Broder New York Times review, the inaccuracies of which the company both refuted and rose above, pushing Tesla stock to new highs.

Irresponsible media aside, the Time story points to a list of no-goes that any public persona must avoid if he or she wishes to avoid media immolation. The last time anyone heard a public official suggesting that firefighters were part of the problem, rather than the saints that they are, it was MMA Rail chairman Ed Burkhardt, providing the world with a master class on the worst possible way for a CEO conduct himself in the aftermath of an accident.

Musk’s marketing savvy, based mainly on his cultivation of a fierce loyalty on the part of an engaged user base, seem to have placed Tesla in as good a position as it can possibly have to weather the storms of bad publicity, unfriendly politics or media and the shifting sands of the energy priorities of the United States in future.

No matter how correct Musk may be in pointing out that the fire would not have been as bad as it was if the firefighters on the scene had acted differently (contradicting their standard method), the worst thing you can do is provide even a whiff of “I don’t support our firefighters” blood in the water for media sharks to frenzy themselves over.

Adding to the volatile mix of public perception for Tesla is the political situation in the United States, in which the suggestion that a future of self-driving clean energy automobiles lies ahead for all of us borders on straight-up Marxism. The Solyndra debacle, in which the bankruptcy of a solar panel company became a wedge issue in the presidential campaign for the purposes of discrediting the DoE’s funding of cleantech industries, as well talk of energy independence via fracking and oil imported via friendly Canada, have also created obstacles to a rational defence of the need to develop mass transportation solutions that don’t involve deepening our dependence on environmentally destructive technologies.

What sets Tesla and Musk apart in the long run actually comes down to his own libertarian street cred. He can point to the fact that Tesla’s capital is privately raised (the company takes great pains to point out that it paid back a $465-million loan from the Department of Energy in May). That coupled with the fact that Musk regularly knocks taxpayer-funded projects like high-speed rail, just as any good Silicon Valley tech baron ought to, goes a long way to separating him from the likes of Solyndra.

That and Musk’s marketing savvy, based mainly on his cultivation of a fierce loyalty on the part of an engaged user base, seem to have placed Tesla in as good a position as it can possibly have to weather the storms of bad publicity, unfriendly politics or media and the shifting sands of the energy priorities of the United States in future.

Deutsche Bank analyst Dan Galves, pointing out that a catastrophic event for the Tesla “had to happen at some point”, nonetheless continued to maintain a buy rating on the company, setting a target share price of $200, while suggesting that the fire was a necessary trauma for the company to experience and that the publicity can only get better now that the worst is behind them.

That said, no one is safe from the corrosive power of bad optics. With the damage created by one viral cell phone video behind them, Tesla now has some road experience in containing and extinguishing the fires that are set by bad publicity. It wouldn’t hurt, however, in PR terms if Dick Van Dyke suddenly and publicly announced that he was trading in his Jaguar for a Tesla. Because it’s safer.

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