Tracey Mendrek, Executive Vice President

Earlier this month the “it” car maker Tesla faced a potential public relations nightmare when a video was posted on YouTube of their Model S in flames. While it was tempting to write about it then, it was worth the wait to see how they would handle the exposure and what lessons could be learned from their crisis.

To review, something fell from a truck, struck the underside of the Tesla, rupturing the housing of the battery packs causing the car to burst into flame.  As you would wish when purchasing a vehicle with a base price of $62,000, it alerted the driver to exit the car immediately. While it was extremely fortunate that no one was hurt, a video going viral of your company’s car flaming out on a Washington highway is not considered a happy ending.

Setting aside the impact this had on the company’s stock price, their handling of the communications crisis was well done.  The company quickly came out with a statement identifying what they believed to be the cause of the fire and reiterating that electric vehicles, particularly this one have an outstanding safety rating.  Shortly thereafter the company CEO, Elon Musk personally addressed the issue in a blog post on their website.)

In another preemptive strike, the company provided a loaner car to the vehicle owner, who later emailed the company stating his continued loyalty to the brand.  Tesla, with the vehicle owner’s permission, published a quote on its blog: “I guess you can test for everything, but some other celestial bullet comes along and challenges your design. I agree that the car performed very well under such an extreme test. The batteries went through a controlled burn which the internet images really exaggerate.”

The story has since mostly moved off the radar of the general public.  Stock prices and new car sales are finding a new norm, but for the most part Tesla has weathered the storm well.  The takeaway from this experience is to handle the crisis immediately by being present and acknowledging the crisis, frequent communications and forethought for the desired outcome.