Tesla Motors Inc.'s (NASDAQ:TSLA) stock price fell 2.52 percent in afternoon trading Thursday, to $195.65, after a highly anticipated announcement failed to inspire investors. The stock price had gained 5 percent in the first three trading sessions of the week after CEO Elon Musk announced Sunday on his Twitter account his company would make a big announcement on Thursday, tweaking traders’ interest in the stock.
But the news that the electric car company is sending out an over-the-air software update that will add new navigation and safety features to the Model S, including a map of nearby car-charging locations, was met with a slow clap by investors. The stock price is still about 3.7 percent higher than at its close last Friday, before Musk’s Sunday Tweet. In it, he claimed his company would “end range anxiety” at a Thursday press conference in California. He was referring to the primary concern people have about electric cars: that they could run out of energy before finding a place to charge their vehicle.
“Incorporating charging locations into a vehicle’s navigation system and trip planning is an excellent feature, but it’s also not new or innovative,” Karl Brauer, senior automotive analyst for Kelley Blue Book, said in an email. “It sounds like the Model S will be more capable of alerting the driver when he or she is nearing that threshold [of running out of power], but I’m not sure these warnings equate to eliminating range anxiety.”
The Tesla Model S luxury sedan has an industry-leading range of up to 265 miles, well above the 80 to 100 miles of most electric cars on the market.
Tesla also announced the software update would include automatic collision-avoidance braking and blind-spot and side-collision warnings. All of these features already are widely available in the market, especially as options for luxury cars, but Tesla is the first company to add safety features to an existing fleet of vehicles using a wireless software update.
Tesla also announced that later this year it would present more software upgrades, including adding hands-free steering on freeways and other major roads, and the ability to summon the Model S remotely. Both features would be a first for the industry.