Consumer Reports Reverses Its Decision on Tesla Model 3

May 30, 2018, 6:28 PM UTC

Consumer Reports has shifted its stance on the Tesla Model 3 and is now recommending the electric vehicle after the automaker issued a software update that improved braking distance on the car.

Shares of Tesla jumped nearly 3.5% after the report was released by the consumer organization Wednesday. Tesla’s share price has since settled to $291.85, up by about 2.85%.

The reversal — not the first time CR has done this with a Tesla vehicle — followed a public argument on Twitter between the consumer organization and Tesla CEO Elon Musk, who described the initial review as “very strange.”

In its initial Tesla Model 3 review, CR pointed out several flaws with the vehicles, notably long stopping distances in its emergency braking test and difficult-to-use controls. The braking issues kept CR from giving the Model 3 its recommendation. Of the 57 hybrid and electric vehicles Consumer Reports has reviewed, it ranked the Tesla Model 3 sixth, behind the front-running 2018 Toyota Prius.

CR noted the Tesla Model 3 had dramatic problems with emergency braking at high speeds. The car took 152 feet to stop — 7 feet more than a full-sized Ford F-150 pickup — when traveling at 60 miles per hour.

Musk argued that the braking issue could be fixed with an over-the-air software update (OTA), technology that Tesla regularly relies on to improve performance and roll out new features on the infotainment system it its vehicles. Musk said the update began rolling out May 25 and that it “should improve braking distance by ~20 ft for repeated heavy braking events.”

CR said during retesting after the software update was downloaded, the Model 3 stopped in 133 feet from 60 mph, an improvement of 19 feet.

Tesla’s use of OTA to fix the braking problem, however, surprised Jake Fisher, director of auto testing at Consumer Reports. Fisher, who has been at CR for 19 years and tested more than 1,000 cars said in the CR write up of the testing and new decision that he’s “never seen a car that could improve its track performance with an over-the-air update.”

It seems, that in CR’s view, Tesla has redeemed itself. At least enough to get a recommendation. And it comes at a critical time for Tesla, which has struggled to ramp up production of the Model 3 and is facing pressure from unhappy activist investor groups to bring on more independent board members. Tesla’s annual shareholder meeting is June 5.

Issues still remain, CR notes. The improved braking distance pushed the Model 3’s overall score up enough for the organization to issue a recommendation. Testers found other problems though with the vehicles wind noise, uncomfortable rear seat, and stiff ride. Musk told Fisher in a nearly hour-long conversation after the initial review was released that the company had already made changes to the production line to fix those three issues.

Software patches have prompted CR to reverse its decision on Tesla vehicles before. In 2017, CR docked the Model S two points in its 100-point rating system that factors in performance, reliability, owner satisfaction and safety, pushing the sedan from its top spot. CR lowered the score because newer versions of the electric vehicle didn’t have an emergency braking system that Tesla said would come standard in its cars.

But the consumer organization restored some of those points after Tesla updated its software to add automatic emergency braking. The added points were enough to make the Tesla Model S the top ranked ultra luxury vehicle.