Tesla Inc.'s (TSLA) path to sustained profitability took a hit Thursday after consumer advocacy group Consumer Reports rescinded its recommendation for the new Model 3 after members "identified a number of problems with their cars."
Those problems included issues with the vehicle's body hardware, paint and trim. Consumer Reports came to its decision following the conclusion of its annual reliability survey, which includes data on about 470,000 vehicles.
"While Teslas perform well in Consumer Reports' road tests and have excellent owner satisfaction, their reliability has not been consistent, according to our members, which has resulted in changes to their recommended status," said Jake Fisher, senior director of auto testing at Consumer Reports.
Despite Consumer Reports' stance, Tesla still holds the firm's top spot on its list of brands that satisfy owners the most.
A Tesla spokesperson responded to the report, saying that the automaker already has made "significant improvements" to correct the Model 3 issues.
"The vast majority of these issues have already been corrected through design and manufacturing improvements, and we are already seeing a significant improvement in our field data," the spokesperson said.
The Model 3 is Tesla's key to dominating the car market of the future, but the vehicle has run into numerous production and delivery issues since its inception. Still, CEO Elon Musk expects the company to deliver 400,000 vehicles this year.
Meant to say annualized production rate at end of 2019 probably around 500k, ie 10k cars/week. Deliveries for year still estimated to be about 400k.— Elon Musk (@elonmusk) February 20, 2019
Tesla shares are down 1.44% on Thursday.