Tesla investigates after Model S exploding in Shanghai is caught on tape

UPDATE: Chinese rival NIO looks into apparent fire of one of its cars after video showed a parked Tesla Model S bursting into flames

Visitors walk past a Tesla Model 3 at the Shanghai Auto Show in Shanghai on April 17, 2019. Tesla is investigating whether its Model S exploded while parked on a street in the Chinese city. AFP

Tesla and its Chinese competitor NIO are looking into fires involving their vehicles, as videos of a car bursting into flames circulate on social media in the world’s largest electric auto market.

US electric vehicle (EV) maker Tesla on Monday said it has sent a team to investigate a video on Chinese social media which showed a parked Tesla Model S car exploding, the latest in a string of fire incidents involving Tesla's cars, Reuters said.

A few hours later, NIO - a Shanghai-based EV maker that listed on the Nasdaq last year - said one of its ES8 models caught fire in the north-west Chinese city of Xi’an while being repaired. No one was harmed and NIO is investigating.

The Tesla video, time stamped Sunday evening and widely shared on China's Twitter-like Weibo, shows the parked EV emit smoke and burst into flames seconds later. A video purportedly of the aftermath showed a line of three cars completely destroyed.

Reuters was not immediately able to verify the origins of the videos, which Weibo users said were taken in Shanghai. The cause of the explosion could not be immediately ascertained from the videos.

"We immediately sent a team onsite and we're supporting local authorities to establish the facts. From what we know now, no one was harmed," Tesla said in a statement.

The car maker declined to comment further when contacted by Reuters.

An electric car under the Zhidou brand part-owned by Chinese billionaire Li Shufu’s Zhejiang Geely burst into flames on the road in September, according to a TV station in the eastern city of Hangzhou. In August, a plug-in hybrid 4x4 under BYD's Song brand caught fire while it was parked at the gate of Shanghai’s Hongqiao railway station last August, according to thepaper.cn, according to Bloomberg.

There have been at least 14 instances of Tesla cars catching fire since 2013, with the majority occurring after a crash.

The automaker has said its EVs are approximately 10 times less likely to experience a fire than petrol-powered cars, based on its fleet of over 500,000 vehicles which have driven more than 10 billion miles.

It did not specify whether the statistic referred to normal use or involving accidents.

The incident comes as Tesla tries to push sales in China, where its prices were impacted by tit-for-tat tariffs imposed during Sino-US trade tensions last year.

The automaker currently imports all the cars it sells in China, but is building a factory in Shanghai that will initially make its Model 3 and help reduce the impact of a trade war.

In March, Tesla was also on the receiving end of a labelling mix-up at Shanghai customs resulting in clearance for a batch of Model 3 cars being temporarily suspended.

Analysts said the latest fire incident would likely increase attention on the safety of electric vehicles but was unlikely to have a significant impact on Tesla's sales or reputation in China while the cause was being investigated.

"Tesla had fire incidents before, but they didn't have a big impact on its reputation in China," said analyst Alan Kang at LMC Automotive.

"Since its consumer base is not particularly conservative, and China is pushing the electric vehicle market, if this incident is just accidental, it will not have a big impact on Tesla," he said.

"Tesla self-ignites" was one of the most popular hashtags on Weibo on Monday, racking up over 20 million clicks. Some users urged the automaker to quickly find the cause, whereas others speculated over the impact to the value of Tesla cars currently on the road. Still more found humour in the situation.

"One lesson I learnt from the Shanghai self-exploding Tesla: Don't park your car next to a Tesla," said one commentator.