Tesla Shares Recover Upon Fixing Model 3 Braking Issue

Shares of Tesla traded higher on Wednesday when the company’s mass-market vehicle, the Model 3, received a recommendation from Consumer Reports.

Tesla chief executive officer Elon Musk announced last week that an update would be sent to the Model 3 following information from Consumer Reports that revealed a braking issue on the vehicle. A brake test held by Consumer Reports showed that the Model 3 had a stopping distance average of 152-feet from 60 miles per hour.

Musk then stated that the braking issues were isolated to the anti-lock braking system calibration and added a firmware update. Musk also stated through a Twitter post that the company would not stop until the Model 3 will show better brakes compared to any other car comparable to the Model 3.

Over the past week, a number of improvements have reportedly been sent to the Model 3 as well as an update sent to be set specially to address the quality of the Model 3’s ride quality and previous concerns regarding its wind noise. 

Consumer Reports which has since then announced that it will test the Model 3 again once an update has been sent to the Model 3 have given Tesla’s first mass-market electric vehicle a recommendation earlier this week. 

The wireless update sent to Model 3s have reportedly showed an improvement in their breaking showing a swift impact upon a secondary testing of the vehicle. Consumer Reports who changed its statement regarding its braking issues a week after its previous published report. The Tesla Model 3 has now received a recommended rating from Consumer Reports.

Consumer Reports auto testing director Jake Fisher commented on the update stating that seeing something updated quickly has been quite remarkable stating that previous software fixes made by other manufacturers required owners to return their vehicles to dealers for updates to be installed or issues to be addressed. He also added that the update being done in a week has never been done before.

Tesla has not made any comments regarding the new Consumer Reports recommendation. The company has been increasing the production of its Model 3 since the beginning of the year after Tesla missed its own targets for production and the delivery of the vehicle last year. 

Tesla Stock Movement

While shares of Tesla were up during the previous trading session due to the recommendation from Consumer Reports, the stock is still down by around 17% during the past three months when the stock traded above $300 per share. Despite the growing revenue of the company, they have posted twice as much losses than expected with their net loss exceeding $2 billion for the past twelve months or around 19% of its sales.

Aside from issues investors faced regarding the company’s dwindling cash reserves and weak production, issues surrounding a car crash in Brussels involving a Tesla Model S just recently surfaced. However, the electric car-maker denied the report stating that the vehicle drove on its own using the Autopilot feature and crashed into a number of parked cars. 

According to Tesla’s investigation, it confirmed that a customer was driving and operating the vehicle and that the vehicle was not under autopilot mode when it crashed. Tesla also added that vehicle is installed with level 2 driving assistance system and does not make the vehicle a self-driving car.

Read also: Tesla Shares Recover from Weak Model 3 Production

FSMSmart gives you the latest news updates, market trends, and news about forex, commodities, stocks and many more! Open an account now and learn more about other investment opportunities on FSM Smart.