Tesla Hits Back at Lemon Lawyer - Analyst Blog

Tesla Motors, Inc. TSLA has hit back at a lemon law claim filed by a lawyer against it for allegedly ignoring his client's three requests to buy back the car. The client reportedly faced problems with the door handle and fuse of his Model S multiple times. He claims that Tesla failed to address the problems and hence he wants to return his car.

Tesla however contends that it only received one request for buying back the car. Moreover, the automaker claims that it did everything possible to redress the customer's grievances and is still striving to do so.

Tesla replaced the door handles of the car even though it failed to recreate the alleged problem in them. Even that did not solve the problem according to the customer.

Regarding the problem with the fuse, Tesla detected that the front trunk of the car, which provides access to the fuse, had been opened each time before the fuse blew. This indicates the possibility of fuse tampering. In fact, the electric carmaker revealed that the fuse problem was solved once its service team put a non-tamper tape on the fuse switch. Moreover, Tesla's engineers did not find any problem with the car that might have caused the fuse to blow.

Tesla also mentioned that the same customer and the same lawyer had filed a lemon lawsuit against Volvo last year. While this does not prove anything, it is definitely cause for suspicion.

It is worth noting that Model S scored 99 out of 100 in a consumer satisfaction survey by the Consumer Reports magazine. This is the highest score in the last few years. Results are based on the response of 350,000 Consumer Reports subscribers who own a car. More than 600 of them were owners of the 2012 or 2013 versions of Model S.

Tesla currently carries a Zacks Rank #2 (Buy). Some other automobile stocks that are worth considering are Tata Motors Limited TTM, Toyota Motor Corporation TM and Daimler AG (DDAIF). Tata Motors and Daimler sport a Zacks Rank #1 (Strong Buy), while Toyota holds a Zacks Rank #2.