Model 3 Loses Consumer Reports Recommendation

Tesla had a flat tire Thursday after Consumer Reports told it that it would no longer recommend the company's Model 3 sedan because of the owner's many complaints about the reliability of the electric car. The shares of the electric car manufacturer fell by almost 4%.

Consumer Reports has abandoned its Model 3 recommendation as part of an annual survey of vehicle owners including data on 470,000 cars, as reported by their owners. The organization rated model 3 as "below average reliability" due to various issues.

"The members told us about problems in their cars, including problems with door handles, loose interior moldings and moldings, paint defects and glass problems, including window defects such as cracks." , says Consumer Reports. drop his model recommendation 3.

Of the 33 automotive brands in the Consumer Reports survey, Tesla ranks 19th, down 11 places from a year ago.

Tesla shares ended Thursday with a loss of $ 11.33 to close at $ 291.23.

The relocation of Consumer Reports comes at a critical time for Tesla. Model 3 is currently starting at about $ 44,000, but its price can exceed $ 50,000 when certain equipment and supplements are added. In addition, Tesla has planned in the coming months to release a version of the Model 3 to 35,000 USD in the coming months, in order to reach a larger number of car buyers.

As part of its Model 3 pricing targets, Tesla recently announced the removal of approximately 3,000 jobs, including more than 1,000 in the San Francisco Bay Area, to reduce expenses and bring down costs. model price 3. Tesla is in the limelight this week. Dane Butswinkas will step down as Advocate General after only two months of work. In its annual report to the Securities and Exchange Commission, Tesla also stated that in 2018, it had paid $ 30.1 million in settlement fees and legal fees related to the statements of the CEO, Elon Musk, the last year on his decision to privatize Tesla.

The SEC had accused Musk of fraud and attempted to remove him from his position as CEO of Tesla because of his comments on securing funds for his take-Tesla-private plan. These charges were quickly settled when Musk stepped down as president of Tesla; he and the company have each agreed to pay fines of $ 20 million.

Tesla rejected much of Consumer Reports' criticism of Model 3. In a statement, a spokesman for Tesla said that, in addition to the "extremely high bar for Model 3," the company "had already made significant improvements to solve the problems related to the 3 "model. customers may have known what is referenced in this report. "

The spokesman also referred to a recent Consumer Reports survey according to which Model 3 was the most satisfactory car among respondents.