"The freak accident occurred about 10:30 a.m. on Nov. 8, 1994, when the family was traveling to Wisconsin to celebrate birthdays. The van, driven by Scott Willis and carrying his wife and six of their nine children, struck a piece of debris that had fallen off a truck driven by Ricardo Guzman. The debris, a mudflap/taillight assembly, punctured the mini-van's gas tank, and the car burst into flames.

Scott and Janet Willis managed to untangle themselves and escape, but the children were trapped and five of the six perished instantly. The oldest in the car, 12-year-old Ben, died the next day."

http://articles.chicagotribune.com/2000-05-01/news/000501016...

Given the number of gas cars on the road, anything described as a "freak accident" must have a very low probability. If this is the 13th serious accident of a Tesla, it's unlikely that the probability is very low.

I'm not sure you've followed the thread here...I don't think anyone's (accurately) saying that this is the 13th spontaneous battery accident. I'm pretty sure the other 12 are standard traffic accidents, of which this is the first to produce a battery fire. All in all, it seems a rather small sample size to make any kind of determination.

> Assuming that the normal rate of battery fires after collisions is one per million, the probability of observing such a fire after only 13 collisions is rather low.

What you're arguing is that the probability of it happening on or before the 13th time is less than it happening on or before the millionth time -- Which is self-evidently true of _any_ probability, and is a much weaker argument.

> perhaps the rate is not one per million

This is much closer to the argument you should be making. I.e. "Given that a purported one-in-a-million event occurred after only the 13th test, what is the probability that their estimate of one-in-a-million is accurate?"

(I don't know the math to answer that question, but I hope somebody that does will come along and chime in.)

Assuming I interpret the actual problem at hand correctly, this is how we formulate it statistically.

We have an event that occurs with probability p = 1/1000000, given an accident (of which there were 13).

The probability of having zero catastrophic events, given that we have observed 13 accidents, is (1-p)^13 = .99987

(For some real hair-raising fun, try this calculation with the success/failure rate of a typical condom.)

Note that this is a purely frequentist interpretation and ignores any Bayesian inference (ie, we assigning a weight of 0 to our Bayesian prior, which is atypical). It's not a very robust way of modeling the situation, for a number of reasons.

Given this XKCD article, I would suggest the probability of a battery fire after an accident is around 1 in 26.

Note that due to the lack of selection bias (battery fire was already among the top security concerns before the accident), we don't actually need a very stringent p-value, so we can be fairly confident that the probability is greater than 1/260.

But my point was that even with probability 1/260, it's likely to be much higher than for gas cars, or you wouldn't have to dig up 20-year-old articles about "freak accidents".

Gas cars have electrical fires all the time. We don't read about it because it's not news.

Admittedly, those cars tend to be poorly maintained, and not nearly new high end expensive vehicles.

> Statistically, there have been fewer fatalities with Model S than the average for the number of miles driven

Which of course it's not. But the general tone here of "move along nothing to see here" is transparently wishful thinking.

Of course a battery fire after hitting some road debris after only a dozen accidents is something to be concerned about. Maybe we don't know just how much yet but no one should be dismissing it offhandedly.

Containing a gasoline fire after it has had a second or two to run is very hard if not impossible.

A key question here is how easy it is to start a fire from a relatively minor and common incident such as hitting road debris. Sure, it's possible in gas cars, and gas fires burn quickly.

But if it's a lot more common in cars with giant vulnerability zones along their entire undersides where shrapnel can start fires through physical damage without even an ignition source...

All I'm saying is this is definitely something we need to monitor closely, not just dismiss offhandedly or spin with clever PR like "the fire didn't enter the cabin (but still could have killed you)".

This stuff is clearly happening all the time.

I think this is relatively common, too. In my life I must have passed a dozen cars burning on the side of the road.

On the other hand, gas power cars have been on the road for a century now, manufacturers have had time to improve safety based, on accidents. Electric car manufacturer can improve from what is right now an excellent record (no explosion).

Let's also not forget that there are more than just Tesla cars out there with the bottom full of batteries: Toyota, Honda and GMC hybrid cars are in the same situation, so the sample isn't as small as you make it sound.

Trillions of miles later, we freak out if a plane's landing gear fails and the plane has to skid to an otherwise uneventful landing.

Tesla and GM vehicles have more sophisticated telematics than other car makers, and I'm sure Tesla is taking advantage of the data (battery pack performance, etc). You'll also get a call if your battery charge drops to a level that will damage your battery.

Equally interesting is that his successor [0] as governor was Rod Blagojevich, who also went to prison for corruption. That wikipedia article mentions that in the last 40+ years, 4 Illinois governors were charged, convicted, sentenced, and sent to prison for corruption or (in one case) fraud.

Quite a tradition they have there. Pat Quinn must be nervous.

----------

[0] http://en.wikipedia.org/wiki/George_Ryan

- Make sure you know the tax arrangements between your country and the US, and file whatever documentation is needed. In the US, you'll probably want/need to file a form W-8BEN with the IRS (http://www.irs.gov/uac/Form-W-8BEN,-Certificate-of-Foreign-S...) to prevent withholding taxes in the US. Most brokerages will be used to that anyway.

- Documentation of your identity. If you have a US bank account already, this will likely be trivial for you. But sometimes US financial institutions gets finicky about this. I had a US bank account with Chase years ago as I had a small business where I had to process a reasonable number of US cheques, and processing them with a non-US bank would effectively eat everything in fees.

I ended up having to go to the US embassy to get an apostille attached to copies of my passport and the application form (basically someone had to watch me sign the documents, and match them to my ID and then attach a document and seal as evidence that they had certified my signatures). Other times they don't care at all - it appears to be down to who has been subjected to cranky auditors and/or concerns about money laundering recently or not...

It's easy enough for things not to catch flame when they're being used properly; the real test is how things behave when other things are going wrong.

That's not to say that this means all Tesla cars are fiery death-traps of doom. Just that the sample size really is the number of crashed cars.

That's ridiculous.

    The Space Shuttle Challenger exploded shortly after take-off in January 
    1986. Subsequent investigation determined that the cause was failure of 
    the O-ring seals used to isolate the fuel supply from burning gases.....

    NASA staff had analysed the data on the relation between ambient 
    temperature and number of O-ring failures (out of 6), but they had 
    excluded observations where no O-rings failed, believing that they were 
    uninformative. Unfortunately, those observations had occurred when the 
    launch temperature was relatively warm (65-80 degF).

Let's look at this question "how bad will that fire be for persons and property involved?"

You look at your 12 crashes where fire occurs, so (e.g.) 6 crashes. Of 6 crashes 3 were accompanied with injuries. All 3 crashes that were accompanied by electrical fires and injuries occurred was when the car's speed was between (e.g.) 40mph and 50mph. Does that mean when the speed is not between 40mph and 50mph, people won't be injured when there's a crash and a fire? It means nothing like that but it's too easy to make a wrong conclusion; you're skipping all the other data where injuries and/or fires happen independently of crashes.

Is this based on any kind of information, or just supposition stemming from the problems Boeing had (where, IIRC, Tesla offered to provide engineering assistance).

I've seen a standard 12v lead acid battery evaporating/boiling hydrochloric acid out of its vent holes, I've also seen one smoking about to explode.

"You said "IMHO ..." and then asserted something with no evidence."

Why would you expect something else when someone starts their post with IMHO?

> If merely listing these things constitutes an ad hominem attack, then it says more about your opinions than it does about me.

Your post had an obvious tone to it.

Have I misrepresented your positions?

If your answer was "no" then why not say that?

My point (addressed incorrectly) stands. It makes less sense for me to answer "no" than for the person I was responding to to answer "no". If I was making a "straw man" then in what way was it straw? If I was misrepresenting his/her opinions, how so? Otherwise, if more-or-less accurately summarizing a person's positions is ad hominem then what does that say of those positions?

Casting aspersions like 'li-ion are notorious' also stinks, much like the smell of gasoline before it (notoriously) explodes.

Ignoring the facts of the particular case whilst hugely generalising about the technology isn't a good foundation of debate.

I assume you have a suggestion as to how this could be remedied? Or, actually, looking at your comment history, I see you are also a climate change denialist.

So, which oil giant do you work for, for whom you are spreading FUD?

First of all, I absolutely agree with what you have to say about the danger of batteries as an energy storage source. Spot on. Good work.

But please, please, please, let's not throw around "paid shill" accusations here. Even if it may be true, it degrades the discourse of conversation for the entire community. Your comment's point was perfectly valid without that.

I agree that we shouldn't be throwing around "paid shill" accusations. Downvoting is better.

http://www.mercurynews.com/business/ci_24229744/tesla-says-c...

"But lithium-ion batteries have raised concerns in other vehicles. Two years ago, battery fires broke out in three Chevrolet Volt plug-in hybrid cars after crash-testing."

"After" being the operative word. They crashed the Volts for testing purposes and then left them sitting outside with a nearly full but damaged battery. THREE WEEKS LATER a fire started.

When testing gasoline powered cars it is standard procedure to empty the tank immediately after crashing it, if they had drained or removed the Volts' batteries in a similar fashion nothing would have happened.

https://publichd.se/index.php?page=torrents&search=&active=0...

Well damn, those sound like verified deathtraps!

Seriously, the fact that she had to reach back two years probably says enough. On the general note of battery safety in crashes, there have been several Tesla Roadster crashes (to be expected with that style of car) (http://www.wreckedexotics.com/tesla/), how many of them resulted in dangerous battery fires? Clearly these batteries do not present a serious safety concern.

Imagine that, structurally compromised systems not disposed of properly are dangerous. That says more about GM than it does the technology.

When I have batteries take damage (falls, shorts, the ever popular screwdriver through them) they are disposed of properly immediately. I also only use proper chargers and don't over charge my batteries. Guess what? I've never had a fire caused by the battery (I've had people plug in components in reverse and blow up the diodes a couple times). I've been working with various battery technologies on a near daily basis for the last 14 years without incident.

Disclaimers: I'm a robotics/electric vehicle enthusiast. I don't do this stuff as my day job any more. I formerly worked in a university research lab building H2 powered race cars.

Only if you're fickle and lack conviction. People are talking a lot about "is Tesla at a fair valuation" and I personally believe that it's impossible to know what a fair valuation is until a few more years have elapsed.

I could reasonably see Tesla bouncing back to $300/share over the next 18 months or staying at or around $200. The current drops are more likely related to general market unease and opportunism rather than anything endemically wrong with Tesla. Also, with "momentum" stocks I'm sure some people got in looking to make a quick buck and also some people are surely taking advantage of the general shutdown-related cacophony to short the stock so they can buy it at lower prices (I would).

Fluctuations like this illustrate why one of the most important qualities an investor can have is patience. If you're trying to get rick quick, you'll be in trouble. But if you invest in solid companies that you understand, you should do well. Provided you do your homework, of course.

I'll reiterate Peter Lynch's excellent advice from "One Up on Wall Street" - if the stock drops but the fundamentals still make sense, stick around to see how the story develops.

E.g. a simplification of such a model would be to create some plausible-looking probability histogram for the "fundamental" value of the company in 10 years. Many investors believe there is a significant probability that Tesla will be worth >100 billion in 10-15 years, i.e. one of the world's major automakers (perhaps one of the largest) due to a global shift to electric vehicles and its 5-year head start and patent moat. It's probably worth noting that multiple major analysts have performed such a DCF analysis and arrived at a number in this ballpark.

Under these assumptions, a $200-300 share price isn't absurd. I can agree it's speculative and extrapolating a lot. But on the other hand a $40 price as some analysts are calling for, is IMHO more absurd since it ignores some very likely growth prospects. If companies were always valued on "fundamental" value, buying growth stocks would be guaranteed to make you a massive, market-beating return.

http://www.streetinsider.com/rating_history.php?q=TSLA

If you have access to analyst reports, the one from Deutsche Bank is probably the one to look at. The best source I can find is this video from August before the recent PT upgrade, but there was an interview somewhere where Dan Galves goes into more detail about the DCF model they are using.

http://www.cnbc.com/id/100946446

http://www.streetinsider.com/Analyst+Comments/Tesla+Motors+%...

Main point being, there are people with a solid economics background who disagree with your claim of absurdity. You're of course welcome to put your money where your mouth is and short; Tesla was for reference the most-shorted stock on the NASDAQ at $30/share.

Here is a justified valuation of $67. Tell me what assumptions are wrong how how that would yield a value of >$200.

http://aswathdamodaran.blogspot.ca/2013/09/valuation-of-week...

Furthermore, direct comparison with the established auto industry is dangerous, since we are likely to be in the beginning of a large-scale transition to electric vehicles. The established auto industry will have trouble with this transition due to vested interest in internal combustion vehicles. Tesla has already demonstrated that it can tackle innovation on a level the established industry is unable to (cutting out the dealerships, fully utilizing the advantages of electric drivetrain, software-like configuration of cars including battery swap), so from my perspective it seems exceedingly likely that it will at the very least grow into a major automaker. But the upside from this point is discounted by analyses such as the one you linked.

That said, I don't really care whether you agree with this. You're certainly welcome to take the other side of the bet; I have my money where my mouth is. Would you be willing to take a short position in this stock?

> The established auto industry will have trouble with this transition due to vested interest in internal combustion vehicles.

Ford is already shipping an electric Focus. GM has stated they are working on one that will compete with Tesla's $30000 model.

> so from my perspective it seems exceedingly likely that it will at the very least grow into a major automaker. But the upside from this point is discounted by analyses such as the one you linked.

No, it assumes it grows into a major automaker with revenues comparable to Audi and has margins in the top 5% of the industry.

I invite you to take a short position and put your money where your mouth is. It's a bit annoying to argue with someone who apparently doesn't believe enough in their case to act on it.

Again, valuation is not the same as price and we are not talking about price. Tesla's stock price is not being driven primarily by fundamental value. From the same author: " Once you accept the pricing proposition that the market price is what it is, the key to winning at the pricing game becomes forecasting changes in price rather than assessing whether the current price is right. As a consequence, your focus on news stories will become incremental and each news story will be assessed in terms of how it will change the price, rather than how it will affect overall value."

I don't trade individual securities, I wouldn't trade a "hot" stock based on valuation since the price is then driven by other factors and I certainly would be reluctant to short any stock because shorting is a complicated trade: Shorting is a short term play, you need to know when to short or else you will be crushed by fees. You can also be bitten by things like squeezes and acquisitions and the fact that shorting without protection is unlimited liability. Shorting is far more dangerous than going long and even sophisticated professional money managers get burned, even when the stock is actually overpriced. QE-infinity makes shorting even more perilous.

What is annoying is that you pretend you did a valuation before investing in Tesla and traded based on the valuation. Now you rationalize the trade to yourself by interpreting information in a way that suits the outcome, post hoc ergo proper hoc.

You might make money but it won't be because of any justifiable insight you had.

If you do find a way to do a proper DCF with mostly-known variables on a growth company likely facing an industry-wide paradigm shift, make sure you capitalize on it by making an exception to your rule of not trading individual securities :P

No one has claimed that this is a science, and this includes the hardcore value investors who often miss risks which the market had in fact priced in.

Goodness I hope so... A modern fire engine can pump a couple thousand gallons of water and foam every minute...

However it also only has around 750-1000 gallons of water onboard. So you'd better hope that there's a hydrant nearby.

Also, hand lines are only 150-250gpm. A deck gun is pretty useless for a car fire (a - can't be aimed at below 0deg, and b - you'd have approximately 30 seconds of usable time to get any deluge on the car and extinguish it, which is not particularly realistic if it's at all involved).

Obviously there are limiting factors beyond the flow rate of the pump. My point was simply that a car fire that exceeds the firefighting capabilities of a single engine would be a very impressive car fire indeed.

But yeah, maybe a ground monitor would work. :)

Does anyone have an image or video of that kind of notice?

Then one day, it said, "Your electrical system is malfunctioning." We all bust out laughing. If was funny until the engine stalled after 4 more miles.

Turned out the alternator was dead.

That said, I've seen more Lamborghini and lotuses on the highway bursting in flames than model S's (Ss? Ses?)

And

> Statistically, there have been fewer fatalities with Model S than the average for the number of miles driven

Biggest fallacy ever read here. Most car accidents happens when people are traveling large distances or coming back from unusual places such as parties and bars (not home-work commute) and the Tesla and other low range electrical nowadays are mostly commute machines. (yeah they can be used for those things, but 99% of the people that actually buys them do not)

Source please? I've always heard that the majority of accidents happen within the first few miles of a drive, but have not put in any research.