Tesla’s Model 3 seen likely to have average reliability

Tesla probably will pull off average reliability with the Model 3 sedan Elon Musk is counting on to dramatically expand demand for his electric cars, according to Consumer Reports magazine.

Consumer Reports made the prediction based on the amount of technology the Model 3 shares with the larger Model S sedan, which the magazine’s subscribers rated above average for the first time in an annual survey.

Tesla still ranks among the bottom third of the 27 brands, due to continued struggles with its Model X crossover.

The closely watched source of product recommendations is making a forecast Musk will be able to hit the mark with the first model he’s attempted to mass manufacture.

The Model X exemplifies Tesla’s checkered history of new product introductions, which larger automakers with decades of experience assembling in high volumes still struggle with, Consumer Reports said.

“They realize that it’s important to get this car right,” Jake Fisher, the magazine’s director of auto testing, said of Tesla in an interview.

“We would’ve not predicted average for the Model 3 unless we saw above-average data for the Model S. If the Model S was still just average, we would’ve not made that prediction.”

Consumer Reports has built credibility for its ratings by refusing advertising from automakers and paying for the vehicles it evaluates.

The magazine’s views on Tesla have been up and down: The Model S scored an off-the-charts rating in 2015, but the magazine pulled its recommendation two months later after owners reported an array of quality problems.

In April, Tesla models were downgraded after owners went months without an automatic braking system. By July, the safety feature was fully restored and the Model S and Model X recouped the points they lost.

“Consumer Reports has not yet driven a Model 3, let alone do they know anything substantial about how the Model 3 was designed and engineered,” a Tesla spokeswoman said in an emailed statement.

“Time and time again, our own data shows that Consumer Reports’ automotive reporting is consistently inaccurate and misleading to consumers.”

Shares of the Palo Alto, California-based company were down 2.3% to $351.28 at 3:40 p.m. New York time. The stock is up 65% this year.

The magazine cited the relative mechanical simplicity of electric cars as another reason the Model 3 probably will be average – a tough feat to pull off with new models that tend to experience “growing pains.”

The car will likely lag behind General Motors Co.’s electric Chevrolet Bolt, which launched with above-average reliability, Consumer Reports said.

Tesla has delayed the unveiling of an electric semi truck and fired workers this month following a slower-than-projected start of production for the Model 3.

The Palo Alto, California-based company has said it’s dealing with unspecified bottlenecks and said the dismissals were related to performance reviews.

Consumer Reports routinely predicts reliability for vehicles that are new to the market, based on manufacturers’ track record and factors including the number of components carried over from previous models.

Best, Worst

The improvement by the Model S made Tesla one of the biggest gainers in this year’s rankings, with the brand jumping four spots to 21st out of 27. The Model X remains “terrible” in terms of reliability, Fisher said.

Tesla’s SUV and GM’s Cadillac Escalade were the two vehicles with the most problems in the survey, Fisher said in a presentation Thursday to the Automotive Press Association in Detroit.

Kia Motors Corp.’s Niro crossover was the least problematic. Much of Kia’s technology goes into production first in Hyundai models, so the bugs get worked out before Kia uses it, Fisher said.

Biggest Movers

Fiat Chrysler Automobiles NV’s Chrysler was the most improved in this year’s reliability survey, vaulting 10 spots to rank 17th. The brand discontinued its poor-performing 200 sedan, and the new Pacifica minivan rated average.

Volkswagen AG’s namesake brand climbed six spots to 16th. Subaru Corp.’s line of vehicles passed five other brands to rank sixth, while BMW, Tesla and Fiat Chrysler’s Ram all gained four spots.

The biggest decliner this year was Honda Motor Co.’s Acura. Each of its models rated below average with the exception of the redesigned RDX crossover, dropping the brand seven spots to No. 19. Mazda Motor Corp. and GM’s Cadillac both dropped six spots.

Problems with transmissions and infotainment systems were the most common in the survey, Fisher said during his presentation. Transmission issues are weighted more heavily, because they are harder to fix, he said.

American Split

All four of GM’s brands fell, with GMC and Cadillac finishing in the bottom two and Buick slipping five spots to rank eighth.

The Detroit-based company’s reliability tends to follow its product cycle, according to Consumer Reports. When GM has more new models, as it does now, there are more problems.

At the same time, Fiat Chrysler — long a laggard in the magazine’s surveys and other quality studies — improved with each of its traditional U.S. brands.

Still on Top

Toyota Motor Corp.’s namesake brand jumped ahead of its luxury line Lexus to take first place in this year’s rankings.

This is the fifth straight year the brands have been the two highest-scoring in the industry. Kia moved up two spots to No. 3, Volkswagen’s Audi held steady at No. 4, and BMW rounded out the top five.

Read: When can we expect Tesla’s Model 3 to arrive in South Africa?

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Tesla’s Model 3 seen likely to have average reliability