Tesla Stems Bleeding After Bad Few Days
By TOM KRISHER
DETROIT (AP) a¿¿ Investors in the Tesla electric car company stemmed the bleeding a bit Friday. But it was still an abysmal few days, marred by another fire in a Model S and earnings results that many found disappointing.
Tesla's shares dropped a total of $37 on Wednesday and Thursday and were down another $7 by noon Friday before recovering to finish with a loss of $1.82. Twenty-two million shares traded Friday, almost double the average daily volume.
In three days, Tesla shareholders lost $4.7 billion, or nearly 22 percent of their investment. Billionaire CEO Elon Musk, who held about 28 million shares as of May 30, or a nearly a quarter of the stock, lost more than $1 billion as Tesla stock plunged from $176.81 at the close Tuesday to $137.95 on Friday.Tesla could face more challenges next week. The National Highway Traffic Safety Administration, the U.S. government's auto safety watchdog, said Friday it is in close contact with Tennessee officials, gathering information before deciding if a full investigation is needed. However, by late Friday afternoon, NHTSA had not spoken with the trooper investigating the fire, said Tennessee Highway Patrol spokeswoman Dayla Qualls in an e-mail to The Associated Press. For most of the year, Tesla Motors Inc. was a Wall Street darling as the Model S received a top safety rating from the NHTSA and accolades from Consumer Reports and other magazines. Tesla, which is based in Palo Alto, Calif., posted its first quarterly profit in the second quarter. Tesla's stock rose more than 470 percent from Jan. 1 through Sept. 30. The next day came the first fire in a Model S, outside of Seattle. This week, a similar incident involving road debris occurred near Smyrna, Tenn. Before pictures of the fire appeared online, investors were already concerned by the company's earnings report and a statement from Musk about Tesla needing more lithium-ion batteries to keep up with demand.
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