Tesla share price continues to slide in pre-market trading
The electric carmaker has seen its share price slide by more than $100 over the last two trading sessions, driven by concerns over its autopilot system from the US National Transportation Safety Board.
Tesla continues to see its share price fall in pre-market trading, with the stock tumbling more than $100 over the last two trading sessions due to criticisms over its autopilot system from the US National Transportation Safety Board (NTSB).
Tesla closed at $799 a share on Tuesday, with the stock trading at $791 in pre-market trading as of 11:20 (GMT) on Wednesday.
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Tesla Autopilot system blamed for fatal Model X crash
Tesla Autopilot, which is the electric carmaker’s driver assistance system, which is a standard feature across all its vehicles, was partially blamed for a fatal Model X accident outside Mountain View, California two years ago by the NTSB.
According to a report by the NTSB, during the fatal crash, Apple engineer Walter Huang was driving his Model X with Autopilot engaged, with the driver distracted by a mobile phone game he was playing at the time.
However, the autopilot system failed to keep the Model X in its highway lane, failed to monitor and alert the driver to take over manually, and the car’s collision avoidance systems also failed, according to the NTSB report.
‘Manufacturers and NHTSA must make sure that these driver-assist systems come with critical safety features that actually verify drivers are monitoring the road and ready to take action at all times,’ Ethan Douglas, senior policy analyst for cars and product safety at Consumer Reports, said in a bulletin after the NTSB report.
‘The evidence is clear, and continuing to pile up, that if a car makes it easier for people to take their attention off the road, they’re going to do so—with potentially deadly consequences,’ he added.
Market sell-off driven by Coronavirus fears drives Tesla lower
The electric carmaker has also seen its share price come under pressure over the last two days due to a broader market sell-off driven by coronavirus concerns as the outbreak continues to spread globally.
Over the last two trading sessions, Tesla has seen around $19 billion wiped off its market cap. However, the company’s valuation is still greater than that of rivals like General Motors, Ford and Fiat-Chrysler.
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To make matters worse, analysts from US-based investment bank Jefferies downgraded the stock from a ‘buy’ to a ‘hold’ rating on Tuesday.
‘However convinced we are about the Tesla equity opportunity, we still need valuation to be grounded into some visibility on market size and potential profitability,’ Jefferies analyst Philippe Houchois said in a note.
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