The shares of American electric vehicle and clean energy company Tesla Inc (NASDAQ: TSLA) are down today after reports that a new Model S Plaid was caught on fire under strange circumstances. As reported by electrek, the incident happened in a suburb of Philadelphia on Tuesday, drawing the attention of The Gladwyne fire department who participated in efforts to kill the fire.
Car fires from an electric vehicle are not so common compared to gasoline cars, making the Tesla fire incident more of a surprise. According to the report released by the fire department, the efforts to kill the fire posed a challenge as dual engines supplied water for up to 90 minutes before cooling the engines down.
While there seems to be an ongoing investigation as to the cause of the fire, the incident might have weighed in on the shares of the Elon Musk-led company. The shares plunged down 0.16% on Wednesday when the news broke to close at $679.70 per share. The findings of the investigation, if made public will likely take a toll on the future trend of the stock. Earlier before now, Musk had commented on the fact that the company delayed the delivery of the Model S Plaid in order to make its new battery pack, derived from new technology, to be very safe.
Tesla Model S Plaid Caught on Fire as Key Delivery Reports are Underway
The Tesla car caught on fire came just days before the Palo Alto, California-based company is billed to release key numbers for its car deliveries. While the incident is not going to affect the figures for the second-quarter reports, if not addressed properly, may impact this new quarter.
According to FactSet, Wall Street analysts are projecting a total delivery of 196,700 vehicles, a 6.4% increase from the last quarter and over twice the year-ago figure of 90,900. Last year, the Fremont, California, plant was closed for much of the quarter due to the COVID-19 lockdowns. Per the projections, FactSet estimates that Tesla will deliver 193,500 Model 3/Y cars and 3,200 Model S/X vehicles.
Besides the general consensus estimate by the Wall Street, RBC Capital analysts led by Joseph Spak foresees a delivery number of 195,000 per a June 28 report. The analysts believe the industry stakeholders will want to see how Tesla performs amid the broader semiconductor shortage.
“Eyes will be on Tesla’s production too, which we believe will fall below 2Q21 deliveries owing to global semi shortage, so Tesla likely drew down on some inventory this quarter,” Spak wrote. Spak noted that the demand for Tesla products increased sequentially in the past quarters, however, challenges associated with recalls, tension with Chinese regulations, and now, the new fire incident is likely to weigh in on performance as it “could negatively impact perception.”