Tesla Motors [NSDQ:TSLA] had an up-and-down 2013, and 2014 looks to be no different on initial assessment.
While 2013 was a year of rave reviews, high sales and the occasional lows of fire-related incidents, 2014 has started with a charging adapter recall for the startup automaker--one that CEO Elon Musk doesn't really believe is a proper recall.
Musk's conflict with the NHTSA over such issues could lead him into trouble though, says Kelly Blue Book editorial director Jack Nerad to Bloomberg.
Just under a week ago, the NHTSA issued a recall notice for certain 2013 Model S cars "equipped for, and delivered with, certain NEMA 14-50 (240 volt) Universal Mobile Connector (UMC) adapters."
The recall is designed to fix an issue that could lead to overheating--and potentially fires--in the wall outlet, charging cord or the adapter itself.
One such incident is said to have sparked a garage fire in Irvine, California, in mid November.
The fix amounts to a firmware update, delivered wirelessly, with no cars physically recalled by Tesla. It led Musk to issue a tweet clarifying the recall--before a frustrated tweet stating that "...the word 'recall' needs to be recalled."
It was echoed in comments by Tesla vice president of business development Diarmuid O'Connell, who questioned whether "recall" was the correct term for a change that didn't actually require the customer to bring their car to a dealer.
Musk has also questioned the term based on where the most recent fire is said to have started--in the house wiring, rather than any part of the car. "What are they supposed to do about that, issue a recall for the house?" he said.
Nerad believes Musk's reaction to official NHTSA processes is the kind of reaction you'd expect "from someone who is essentially a rookie in the car business".
Tesla risks its relationship with a body that could force costly alterations or fine millions of dollars for non-compliance on safety issues--that Tesla knew about the plug adapter problem could result in a fine of up to $35 million for not alerting the NHTSA.
NHTSA deputy administrator David Freidman downplays any tensions, saying Tesla is doing a good job of communicating with and responding to the agency.
But Tesla's public reactions to NHTSA procedures is very different from that of most automakers, who typically discuss recalls behind the scenes with the NHTSA, reducing potential costs by ensuring relatively few vehicles are affected.
To its credit, Tesla has always been very quick to solve potential issues with the Model S--one of the reasons confidence in the product is still so high despite recent negative publicity.
But Tesla should avoid irritating an agency instrumental in the legal safety requirements under which its cars are sold--lest it risk a simple problem becoming a very expensive one indeed.
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