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Tesla's Newest Controversy: Who Knew What And When?

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Tesla's Newest Controversy: Who Knew What And When?

News of a fatal crash involving Tesla Motors Inc (NASDAQ: TSLA)'s auto pilot feature has been well documented by the investment community.

However, the questions of when Tesla was aware of the crash, when it opened a dialogue with the National Highway Traffic Safety Administration (NHTSA) and what information it should have provided to the public have become a bit of a controversy.

CNBC's auto expert Phil LeBeau pointed out during Wednesday's "Squawk Alley" segment that the fatal accident occurred on May 7, but Tesla only notified the NHTSA on May 16 and 2 days later the company oversaw a $1.46 billion stock offering.

On June 30, the NHTS confirmed its probe and will investigate the fatal crash.

Related Link: Are Cheap Gas Prices To Blame For Traffic Fatalities' Increase?

According to LeBeau, Tesla's handling of the fatal crash was reasonable and done so according to the law.

Is There A Controversy?

LeBeau continued that when the company's CEO Elon Musk was asked by a reporter ahead of the stock offering if the crash should have been disclosed to the investment community, he simply added that the crash is not material to the value of Tesla.

LeBeau suggested that Tesla's autopilot feature is a "major selling point" for the vehicle and it is not a "small trivial matter."

"The fact that it is under investigation has a lot of people saying shouldn't you have notified people about that or at least divulged it prior to the secondary offering," LeBeau said. "That's the main question that a lot of people are focused on right now."

Tesla was recently seen trading relatively flat on the day at $213.41.

 

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