Elon Musk s Tesla Motors Inc. (TSLA US) has earned the ardor of investors and the highest U.S. safety ratings. It can also add the honor of having the best reviewed car of the year by automobile testers at Consumer Reports.
Tesla s battery powered Model S beat the Audi A6, Toyota Prius and BMW 328i in Consumer Reports annual ranking, becoming the first U.S. car to receive a best overall pick, the independent product testing magazine said today. The reviewers singled out the Model S for its blistering acceleration, razor sharp handling, compliant ride and versatile cabin.
It s truly a groundbreaking car, Jake Fisher, Consumer Reports director of auto testing who oversaw this year s review of 260 vehicles, said an interview. You get into it, and it really stands out. It s the very best car I ve ever driven.
The top model ranking for the youngest U.S. automaker may further the profile of Palo Alto, California based Tesla, which has said Model S deliveries should increase about 56 percent to 35,000 cars this year. Tesla could almost double its share of the global car market to 1 percent if it succeeds in lowering battery costs, said Adam Jonas, a Morgan Stanley analyst.
If it can be a leader in commercializing battery packs, investors may never look at Tesla the same way again, Jonas, who rates the shares overweight, wrote in a note to clients. If Tesla can become the world s low cost producer in energy storage, we see significant optionality for Tesla to disrupt adjacent industries.
Shares Rise
Tesla rose (TSLA US) 14 percent to close at $248. The shares more than quadrupled last year, making it the second best performer in the Russell 1000 Index. (RIY) Another Musk company, SolarCity Corp. (SCTY US), was the No. 1 stock in that index.
Tesla exceeded $30 billion in market value today as Morgan Stanley more than doubled its price target. Tesla s stock value is now more than half that of General Motors Co. s $57.4 billion and Ford Motor Co. s $59.8 billion. Fiat SpA, which owns Chrysler Group LLC, is valued at $12.9 billion, and Toyota Motor Corp. (TM US), a Tesla shareholder, is more than $200 billion.
Consumer Reports tests and evaluates cars for how well they drive, interior finish quality, safety and reliability. The model rankings influence car buyers and are published in the Yonkers, New York based magazine s annual auto issue.
Volkswagen AG (VOW) s Audi A6 was the Consumer Reports choice for best luxury sedan, while Bayerische Motoren Werke AG s 328i was named the top sports sedan. The Ram 1500 was selected as the best pickup truck, the first time a Chrysler vehicle has led one of the magazine s 10 top pick categories since the 1998 Jeep Grand Cherokee SUV, Consumer Reports said.
Japanese Decline
Japanese cars made by companies such as Toyota, Fuji Heavy Industries Ltd. s Subaru and Honda Motor Co. (7267) had earned 70 percent of the magazine s best car spots since 1997. This year, that was down to half. The Toyota Prius, a gasoline electric hybrid vehicle, was named best green car for the 11th consecutive year.
As recently as a few years ago, a handful of Japanese brands swept the magazine s best picks list, said Rik Paul, automotive editor for Consumer Reports, said in an interview. That s no longer the case, he said. Brands like Nissan and Honda haven t been as consistent, while their competition has gotten better, he said.
Gone are the days when you could say buy a Japanese model, and it will be reliable, Paul said.
The magazine also ranked car brands by total quality based on their vehicles performance in road tests and reliability data from an annual survey of subscribers.
Luxury Brands
Luxury brands generally scored the best. Toyota s Lexus received 79 points out of 100, followed by Honda s Acura with 75 and Audi with 74.
General Motors (GM US) Cadillac, with a score of 54, fared worse than any luxury brand. It lost ground mainly because of problems with the CUE infotainment systems in its XTS sedan, the magazine said. It scored worse than Detroit based GM s other brands, including Buick (63 points), GMC (63) and Chevrolet (56).
Ford tied for last with Jeep of the 23 ranked brands with an overall score of 50. Dearborn, Michigan based Ford dropped in the rankings despite having an average road test score of 73, the same as Honda and higher than Toyota. The brand s reliability was deemed below average, brought down by the magazine s assessment of the MyFord Touch infotainment system and the automatic transmissions in the Focus and Fiesta sedans.
Some Detroit made vehicles, such as Ford (F US) s Fusion, drive as well and have interiors as fine as European luxury sedans, only to be marred by touchscreen dashboard controls that are difficult to use and balky, Fisher said.
BlackBerry System
Infotainment systems made by BlackBerry Ltd. (BBRY US) s QNX were generally easier to use and more reliable, Fisher said. Ford is preparing to switch from Microsoft Corp. (MSFT US) s Windows to QNX, people briefed on the matter said Feb. 22.
Chrysler s Jeep brand was dragged down by poor road testing of its Wrangler, dated Compass and Patriot models and new Cherokees that haven t performed well, Consumer Reports said.
GM, Ford and Chrysler will probably move up in future Consumer Reports rankings, Fisher said at a news conference in Washington today. Models redesigned following GM s bankruptcy have tested well, including the Chevrolet Impala.
Right Direction
When reliability data for the new models is available, GM may be among the highest ranking brands. If Ford fixes the software flaws with its infotainment systems, its ranking will rise, Fisher said.
They re going the right way, Fisher said. The future looks very, very good for the domestics.
The magazines editors bought and tested more than 260 vehicles for consideration in the annual rankings. The best picks rank at the top or near the top in terms of road tests have an average or better reliability ranking and must perform adequately in government and insurance industry crash tests.
It was Tesla s first appearance in the annual Consumer Reports Top Picks list.
Telsa may have a hard time matching the Model S s test scores with its next model, Fisher said. The Model X, a less expensive electric vehicle blending SUV and car attributes is planned for this year, though it will probably weigh more. That may affect road performance, he said.
Lower Prices
The Model S is priced from $62,400 to $85,900 on Tesla s U.S. website. Consumer Reports said the version it tested had a list price of $89,650.
Chief Executive Officer Musk plans to provide details on a proposed gigafactory to produce lithium ion batteries needed to make more affordable vehicles, he told Bloomberg TV last week. Musk co founded Tesla in 2003, staking a personal fortune he amassed building Internet map venture Zip2 Corp., as well as an online payment system that would eventually become PayPal.
Morgan Stanley s Jonas raised his projection for Tesla s share price in 12 months to $320 from $153. The new estimation uses a 15 year outlook to allow time for the company to expand its lineup and capabilities. In a bull case scenario, he said, the company may be worth as much as $500 a share.
Separately, Tesla s method of accounting for Model S residual values triggered a review of the carmaker s quarterly filings by the U.S. Securities Exchange Commission.
Consumer Reports Magazine s Best Cars by Category Best Overall Tesla Model S Luxury Car Audi A6 Sports Sedan BMW 328i Midsized Sedan Honda Accord Green Car Toyota Prius Compact Car Subaru Impreza Small SUV Subaru Forester Midsized SUV Hyundai Santa Fe Minivan Honda Odyssey Pickup Truck Ram 1500 Consumer Reports Magazine s Brand Rankings (1) Lexus (2) Acura (3) Audi (4) Subaru (5) Toyota (6) Mazda (7) Honda (8) Infiniti (9) Mercedes Benz (10) BMW (11) Volvo (12) Buick (13) GMC (14) Chrysler (15) Kia (16) Hyundai (17) Volkswagen (18) Nissan (19) Chevrolet (20) Cadillac (21) Dodge (22) Ford (23) Jeep Source Consumer Reports
To contact the reporter on this story Jeff Plungis in Washington at jplungis
To contact the editor responsible for this story Bernard Kohn at bkohn2
Fire safe cigarettes hitting europe?
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Although there has been talk of fire safe cigarettes reaching the UK for the last seven years, the measure has never come to pass. Now, though, the London Fire Brigade is reporting on its website that the European Commission has now agreed on a safety standard for cigarettes and the EU is expected to start selling reduced ignition propensity (RIP) cigarettes (otherwise known as fire safe cigarettes (FSC)) from November, 2011. The measure is defined as voluntary but if manufacturers do not comply their products can be removed from the market. (As of today, the measure has not yet come into force, but is still on the cards.)
Traditional cigarettes, currently still on sale within the EU, stay lit until reaching the butt 99% of the time, while fire safe cigarettes, currently on sale in the USA, Canada and Australia, retain ignition only 10% of the time unless the smoker puffs to keep the cigarette alight. These cigarettes work by adding two or three bands of paper along the length of the cigarette, which reduces the oxygen flow and thus causes the cigarette to go out if not puffed at that moment. There are, however, questions over the safety of these new cigarettes.
The state of New York mandated fire safe cigarettes in June, 2004 and in January, 2005 the Harvard School of Public Health published its study on them. The authors tested nineteen compounds in the cigarettes and all nineteen had higher levels of toxicity than their non FSC counterparts, with carbon monoxide levels being higher by 11.4% and naphthalene 13.9%. Naphthalene can cause myriad side effects if one is exposed to enough of it, such as anaemia, convulsions, vomiting and even comas. In addition to the increased levels of toxic compounds, the bands of paper are glued together with an ethylene vinyl acetate, copolymer emulsion based adhesive, which is used as carpet glue or the tube used in a glue gun. There is evidence, therefore, that fire safe cigarettes contain higher levels of toxic compounds than normal cigarettes, and in a time when much focus is given to the ingredients in cigarettes, should lawmakers not be aiming to reduce these levels rather than increasing them?
Away from laboratory testing and into real world cases, the Internet is awash with cases of smokers who since smoking fire safe cigarettes have suffered from various health problems, which promptly ceased when they switched back to non fire safe cigarettes or rolled their own. Such is the extent of the problem, in fact, that a petition to remove these cigarettes from the market now has over 27,000 signatures, many of whom state health complaints from the cigarettes.
It has long been known that traditional cigarettes contain an accelerant to keep the cigarette burning. From a business perspective it makes perfect sense if the cigarette burns faster, the smoker is more likely to consume more and thus purchase more. Rolling papers do not contain this accelerant and are well known for extinguishing regularly, causing the smoker to relight it. One of the most frequently mentioned facts about cigarettes is that they contain over 4,000 chemicals, and so the question is why not simply remove the accelerant to have the same effect as RIP cigarettes, rather than add more chemicals and increase the toxicity of those already present? In The Medical Journal of Australia in 2004, Simon Chapman wrote that The elimination of citrate and other burning agents in cigarette paper thus appears to be a simple and effective means of dramatically reducing the ignition propensity of cigarettes.