"If you think about what you'd rather be close to, 10 gallons of gasoline or a battery pack, I'd pick the battery pack every day," said Giorgio Rizzoni, director of the Center for Automotive Research at Ohio State University, where he is a professor of mechanical and electrical engineering.
Still, an Internet video of the Tesla fire spooked investors and caused a sell-off Wednesday and Thursday. Tesla shares fell 6 percent Wednesday, and they closed Thursday down $7.64, or 4.2 percent, at $173.31.
At that price, Tesla's market value has dropped about $2.4 billion in the past two days. Still, if an investor purchased a share of Tesla at $35 on Jan. 2, they're sitting on a gain of nearly 400 percent. Tesla has dazzled Wall Street by selling more vehicles than expected and posting its first quarterly net profit earlier this year.
Deutsche Bank analyst Dan Galves, in a note to investors Thursday, said he expects bad news and investor concern to push down Tesla shares in the short-term. Investors, he said, will be concerned because electric cars represent a new technology with a high sensitivity to safety risks. But he wrote that the Model S has been collectively driven more than 83 million miles, yet this is the first fire despite 12 significant crashes and extreme testing by the government.
"We have confidence that this is an isolated incident that could happen to any vehicle," Galves wrote. He still thinks Tesla shares will reach $200.
Tesla said that on Tuesday the Model S warned the driver of problems from the collision. He pulled off the road, smelled smoke and saw flames. A company spokeswoman said the fire originated in a battery cell damaged in the collision, and the car's design prevented the fire from spreading to the rest of the battery and contained it in the front.