Tomahawk, WI 11/21/2013 (BasicsMedia) – At the moment investors are gripped with the reports and the underway investigation into the three fires involving Tesla Motors Inc (NASDAQ:TSLA) Model S cars. The fear over the future of the electric carmaker has already sent the stock down by more than 35% since its peak close in September. Bad press report is actually to blame for the pressure that TSLA stock is going through. For example, mainstream media has never been keen enough to offer both sides of the story when reporting about the fires as well as the ongoing investigation by the U.S. National Highway Traffic Administration (NHTA).

Particularly missing in the mainstream media reports is that concerning the three fires in Model S, the vehicle actually saved the lives of the drivers involved in the accidents. The Model S safety system warns drivers over any problem with car and tells the driver to pull over and exit the car for safety. This is what happened in almost all the fire incidents reported on the vehicles for far. Moreover, the fact that the car catch fire after the vehicles got damaged either by hitting a wall or the undercarrier getting damaged is one line of the story very much avoided. As a result, fears among investors and customers have continued to soar over the safety of Model S.

The fire probe is an opportunity for Tesla Motors Inc (NASDAQ:TSLA) to repair its reputation

It is very much likely that Tesla Motors Inc (NASDAQ:TSLA) will emerge from the ongoing investigations victorious. And this is a big opportunity for the automaker to solidify its reputation. This is why, the issue about Model S fires should be the least worry that investors can have on this stock.

The fact that Tesla Motors Inc (NASDAQ:TSLA)’s chief executive Elon Musk has also adjusted Model S warranty so that it covers fire damage is the latest indicator that the company has safety confidence in the cars. Importantly, this warranty expansion is also expected to entice more buyers which should result in more sales.

So far Tesla Motors Inc (NASDAQ:TSLA) has more than 19,000 Model S cars on the road. With this number, it means that the three higher so far indicate at least one fire for every 6,333 cars. In comparison, gasoline vehicles have fire rate of about one fire per every 1,350 cars on the road.

The real concern over Tesla Motors Inc (NASDAQ:TSLA)

That the future of the automaker is bright cannot be denied. This is the only automaker that is struggling to meet overwhelming demand at a time when its rivals are witnessing declining sales as demand sags across the world. Year to date, the stock is up more than 267%, a huge rise in the automotive industry.

However, the legitimate concern over the future of Tesla Motors Inc (NASDAQ:TSLA) can be seen through its third quarter reporting. The company’s income from zero-emission tax credits amounted to $10 million. In the second and first quarters of the fiscal year 2013, income from this segment amounted to $51 and $68 million respectively. So we can see there’s a declining trend. Further, there is ongoing debate to lower the zero-emission tax credit by about 40%. This indicates that the automaker will have to focus more on income from organic sales instead of tax credits. The good thing is that in terms of organic sales, Tesla Motors Inc (NASDAQ:TSLA) is on an upward trend.

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