NHTSA Reaffirms Tesla's Model S 5-Star Safety Rating - Analyst Blog

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The top vehicle safety rating on Tesla Motors, Inc. 's ( TSLA ) Model S car of model year 2014 has been reiterated by the National Highway Traffic Safety Administration (NHTSA). The Model S obtained a five-star rating overall and also for each of the subcategories.

In Aug 2013, Tesla's Model S won the five-star rating from the NHTSA for the first time. This is a coveted award for Tesla as only 1% of cars tested receive the 5-star rating from NHTSA. The board assesses vehicle performance in frontal, side and rear crash tests and resistance to rollover.

The star ratings have a cap of 5. The Vehicle Safety Score (VSS) can cross this cap, although it happens rarely. However, Model S managed to obtain a score of 5.4. With this, Tesla's Model S sedan ensures exceptional safety to passengers as it has the lowest possibility of injury to passengers among all major cars sold in the U.S. The safety score of this sedan exceeded the score of most sports utility vehicles and minivans.

Tesla was worried about the three Model S fire incidents in a five weeks span. The NHTSA started an investigation after the three fires. As a result of these incidents, NHTSA demanded details regarding the after effect of the damage of battery pack of Model S and the method adopted by Tesla to solve those problems.

In early December, German Federal Motor Transport Authority or Kraftfahrt-Bundesamt (KBA), which was also investigating a fire incident, revealed that it did not find any manufacturing defect in Tesla's Model S. The authority's statement came after it examined and reviewed the vehicle following the recent fires. The German authority issued a letter stating that Tesla does not need to take any action under the German Product Safety Act.

According to Tesla, Model S is safer than the average gasoline car. The probability of the vehicle catching fire is 5 times lesser than any gasoline vehicle. Moreover, there has not been any report of any serious injury in the car either.

Tesla currently has a Zacks Rank #4 (Sell). Other prominent automobile companies include Honda Motor Co., Ltd. ( HMC ), Tata Motors Limited ( TTM ) and Ford Motor Co. ( F ).



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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Stocks

Referenced Stocks: F , HMC , TSLA , TTM , VSS

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