Tesla Model S Misses in Crucial Crash Test

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Tesla Inc. (NASDAQ: TSLA) has raised expectations to such a level that when the electric car maker fails to receive the highest safety rating for one of its models, the news is perceived as a setback for the company. That was the case this week when Tesla’s Model S missed the top safety rating from the Insurance Institute for Highway Safety (IIHS) in a crucial crash test for one of its models.

The Tesla Model S had earned an “acceptable” rating in the small overlap front test in an earlier appraisal of the vehicle by IIHS, a nonprofit organization funded by auto insurers. It was the only one of five categories in which Tesla failed to receive a “good’’ rating from IIHS. The overlap test simulates the type of crash that occurs when the front driver-side corner of a vehicle hits a tree or utility pole or collides with another vehicle.

The main problem with the performance of the Model S at the time, according to the IIHS, was that the safety belt allowed the dummy’s torso to move too far forward, which allowed the dummy’s head to strike the steering wheel hard through the airbag. In real life, this could have caused head and lower right leg injuries.

Click here to see America’s 20 deadliest cars.

Since the previous test earlier this year, Tesla made changes to the safety belt with the intent of reducing the dummy’s forward movement. However, when the IIHS tested the modified Model S, the same problem occurred, and the rating did not change.

The Lincoln Continental, the Mercedes-Benz E-Class, and the Toyota Avalon came out on top of a group of six large cars recently evaluated by Arlington, Virginia-based IIHS.

Barely a month ago, Palo Alto, California-based Tesla was basking in the news that its 2017 Tesla Model X had been awarded a five-star crash safety ratings in every category from the National Highway Traffic Safety Administration, the first SUV to achieve this.

In a statement to CNBC, a Tesla representative alluded to possible subjective motivations by IIHS, while touting the ratings the Model S and Model X received from the National Highway Traffic Safety Administration.

Tesla’s momentum has downshifted in recent weeks. Production of its cars was short of analyst consensus in its most recently released quarter. Goldman Sachs questioned the strength of Tesla’s business model and warned the stock could plunge.

The slideshow uses data from the IIHS, a nonprofit research organization funded by auto insurers. The IIHS measured over 200 vehicles — 2014 models or equivalent — between 2012 and 2015. Only vehicles with at least 100,000 registered vehicles between 2012-2015 were considered. Year to date sales figures were obtained from auto company press releases in May and reflect U.S. sales.