CLOSE The National Highway Traffic Safety Administration and Tesla Motors CEO Elon Musk are both taking a close look at the Model S after car fires reported from striking road debris. VPC 
 
 The electric car maker has sent through a software change to make its cars ride higher 
 
 In this Wednesday, Nov. 6, 2013 photo provided by the Tennessee Highway Patrol, emergency workers respond to a fire on a Tesla Model S electric car in Smyrna, Tenn. (Photo: AP) Story Highlights The National Highway Traffic Safety Administration has opened a probe into Tesla's Model S 
 
 The probe of the electric car results from reports of battery fires 
 
 Tesla CEO Elon Musk says he stands behind the car, but has ordered changes 
 
 The National Highway Traffic Safety Administration said today it has opened a formal investigation into the safety of the Tesla Model S electric car following two reports of battery fires after striking roadway debris. 
 
 The agency said its safety investigation was prompted by recent "undercarriage strikes" in Washington state and Tennessee. In both cases, fires resulted after the cars both ran over debris on the road that pierced the battery compartment. After news of the probe broke, Tesla shares fell to $116 in pre-market trading but climbed back once the market opened. They closed 3.7%, or $4.51, up for the day at $126.09 a share. 
 
 TESLA STOCK: Shares rise despite federal probe into fires 
 
 Early Tuesday before NHTSA's announcement, Tesla CEO Elon Musk announced that he taking three steps as a result of the fires, but added that he stands behind their safety. The steps were: 
 
 •Higher ground clearance to make them less likely to strike road debris that can potentially penetrate the battery pack and ignite a blaze. 
 
 •Asking federal safety regulators to "conduct a full investigation as soon as possible into the fires." Musk gave no hint that NHTSA was about to open an investigation. 
 
 •Amending the cars' warranty to cover damage due to fire. 
 
 A NHTSA probe can lead to recall, but earlier this month Musk says he has no plans to order one because he doesn't think it is warranted. 
 
 Musk announced the steps in a lengthy post on Tesla's blog. In it, he offers yet another strong defense of the car's safety, especially as it relates to protection from fire. "We believe the evidence is clear that there is no safer car on the road than the Model S," he writes. His company expects to produce more than 20,000 of the electric cars this year, which sell for about $70,000 and up. 
 
 He calls media reaction to the three fires a gross overreaction, especially given how thousands of conventional cars have been consumed by gasoline fires from ruptured tanks over the years. 
 
 He says his battery-powered car is actually safer than just about any gas-powered car on the road. 
 
 Elon Musk CEO of Tesla with a new Model S car outside the Tesla customer deliver area at the Tesla Fremont, Calif., factory (Photo: Jessica Brandi Lifland for USA TODAY) 
 
 "Since the Model S went into production mid last year, there have been over 400 deaths and 1,200 serious injuries in the United States alone due to gasoline car fires, compared to zero deaths and zero injuries due to Tesla fires anywhere in the world." 
 
 In the posting of its investigation, NHTSA noted that passengers in the Teslas that caught on fire were able to escape. "In each incident, the vehicle's battery monitoring system provided escalating visible and audible warnings, allowing the driver to execute a controlled stop and exit the vehicle before the battery emitted smoke and fire," NHTSA writes. 
 
 CLOSE Tesla stock fell after reports of the electric cars catching fire after striking road debris VPC 
 
 Two of the Tesla fires were caused when the vehicle struck road debris that pierced the battery compartment. The third happened in Mexico when a Model S crashed. In each case, the occupants escaped unharmed. Musk says it's proof of the car's safety. 
 
 But given the media outcry, Musk indicates he decided to act even though he already stands by the car. He says the plan to create more ground clearance under the cars has already been implemented. 
 
 Tesla has already sent a signal to the computers in all Model S cars to tell them to increase the vehicle's ground clearance at highway speeds. he says the goal is to reduce the chance of hitting objects on the road. Another software update in January is aimed at letting drivers set their preferred road height for themselves and passengers. 
 
 As for the NHTSA involvement in probing the three accidents that led to fires, Musk says that if regulators offers suggestions on how to improve fire safety in the Model S, he will immediately implement them. he has previously said he does not expect that the Model S will need to be recalled over the fires. 
 
 When it comes to extending the warranty on the sedan, Musk says his decision will apply to Tesla models and be applicable even if the driver is held to be a fault for the fire. 
 
 Read or Share this story: http://usat.ly/I0PQdJ ||||| Federal safety regulators opened a probe into a series of fires in Tesla Motors Inc. electric cars following crashes. 
 
 The National Highway Traffic Safety Administration said Tuesday that it would investigate why two of the expensive Tesla Model S sporty hatchbacks have caught fire this year following accidents in which the battery casing that serves as the undercarriage of the car cracked open. 
 
 LATEST: From the L.A Auto Show 
 
 A third fire, which took place in Mexico, won’t be part of the investigation because it is outside the agency’s jurisdiction. 
 
 NHTSA noted that in the two U.S. fires, one in Seattle and the other in Nashville, the battery monitoring system in the cars warned the drivers, allowing them to pull over and safely exit the vehicles before the battery emitted smoke and fire. 
 
 The fires have become an issue for Tesla, contributing to 37% drop in the value of its stock since reaching a high of $193.37 on Sept. 30. The shares were down an additional 2% in overnight trading Tuesday. 
 
 Tesla Chief Executive Elon Musk said the automaker requested the investigation to refute fears that electric cars are more prone to fires than other vehicles. 
 
 [Updated 8:55 a.m. PST, Nov. 19: Tesla Chief Executive Elon Musk claimed that the automaker requested the investigation to refute fears that electric cars were more prone to fires than other vehicles. 
 
 But the NHTSA disputed that, saying its decision was an independent process. 
 
 “In regards to Tesla, the agency notified the automaker of its plans to open a formal investigation and requested their cooperation," the agency said, "which is standard agency practice for all investigations.” 
 
 Tesla is already taking action, changing its warranty to cover damage due to a fire, even if due to driver error. 
 
 “Either our belief in the safety of our car is correct and this is a minor cost," Musk said, "or we are wrong, in which case the right thing is for Tesla to bear the cost rather than the car buyer.” 
 
 The automaker believes the warranty change, which doesn’t apply if an owner purposefully sets the car on fire, will reassure buyers.] 
 
 “If a false perception about the safety of electric cars is allowed to linger, it will delay the advent of sustainable transport and increase the risk of global climate change,” Musk wrote in a post to his blog on the Tesla website Monday night. 
 
 PHOTOS: Tesla Model S 
 
 The automaker is taking advantage of the car’s electronic capabilities to execute a wireless update to the air suspension that will result in greater ground clearance at highway speeds, Musk said. 
 
 “This is about reducing the chances of underbody impact damage, not improving safety,” Musk said. “The theoretical probability of a fire injury is already vanishingly small and the actual number to date is zero.” 
 
 Another software update expected in January will give the driver direct control of the air suspension ride height transitions. 
 
 Musk also defended the automaker’s vehicles, writing that they have a lower fire risk than gasoline vehicles. 
 
 “Since the Model S went into production mid last year, there have been over 400 deaths and 1,200 serious injuries in the United States alone due to gasoline car fires, compared to zero deaths and zero injuries due to Tesla fires anywhere in the world,” Musk wrote. ||||| Tesla Motors Inc. (TSLA)’s third fire in five weeks involving a Model S suggests U.S. regulators need to examine the luxury electric car, a safety advocate said after a Tennessee accident. 
 
 Shares of the Palo Alto, California-based carmaker led by Elon Musk slid 7.5 percent to $139.77 at the close yesterday in New York after reports of the newest fire. That decline follows a 15 percent drop Nov. 6 after the carmaker’s third-quarter results and fourth-quarter outlook disappointed investors. It was the biggest two-day plunge since Dec. 27, 2010. 
 
 The National Highway Traffic Safety Administration “absolutely has to investigate” the Nov. 6 Tennessee incident, Clarence Ditlow, executive director of the Center for Auto Safety, based in Washington, said in a phone interview. 
 
 A Model S driver struck a tow hitch in the middle of a lane on Interstate 24 near Murfreesboro, Tennessee, damaging the car’s undercarriage and causing the fire, Dalya Qualls, a Tennessee Highway Patrol spokeswoman, said in an e-mail. The driver pulled the car over and was uninjured, Qualls said. 
 
 NHTSA declined to investigate a Model S fire in Washington state in October, the first such reported blaze, in which metal debris was involved. 
 
 Source: Tennessee Highway Patrol via Bloomberg A firefighter works at the scene of an accident involving a Tesla Model S sedan near Murfreesboro, Tennessee on Nov. 6, 2013. The driver, identified as Juris Shibayama, struck a tow hitch that was in the middle of a lane, which damaged the car’s undercarriage and caused the fire, said Dalya Qualls, a Tennessee Highway Patrol spokeswoman. Close A firefighter works at the scene of an accident involving a Tesla Model S sedan near... Read More Close Open Source: Tennessee Highway Patrol via Bloomberg A firefighter works at the scene of an accident involving a Tesla Model S sedan near Murfreesboro, Tennessee on Nov. 6, 2013. The driver, identified as Juris Shibayama, struck a tow hitch that was in the middle of a lane, which damaged the car’s undercarriage and caused the fire, said Dalya Qualls, a Tennessee Highway Patrol spokeswoman. 
 
 “It appears there’s inadequate shielding on the bottom of these vehicles,” Ditlow said. “Road debris is a known hazard to the undercarriage of vehicles.” 
 
 The U.S. agency “will contact the local authorities who are looking into the incident to determine if there are vehicle safety implications that merit agency action,” Karen Aldana, a spokeswoman for NHTSA, said in an e-mail. 
 
 Tesla Team 
 
 Liz Jarvis-Shean, a Tesla spokeswoman, declined to comment on Ditlow’s remarks and on whether the company needed to strengthen the aluminum casing that houses the 1,000-pound (454-kilogram) lithium-ion battery that powers the Model S. 
 
 “We have been in contact with the driver, who was not injured and believes the car saved his life,” Jarvis-Shean said in an earlier e-mail. “Our team is on its way to Tennessee to learn more about what happened in the accident. We will provide more information when we’re able to do so.” 
 
 Tesla, the best-performing automotive stock this year, has been under scrutiny as Chief Executive Officer Musk works to create the world’s biggest and most profitable seller of electric cars. Even with this week’s declines, Tesla shares have surged more than fourfold this year after reporting its first quarterly profits. 
 
 ‘Rocket Science’ 
 
 The Washington state Model S fire took place Oct. 1, and another occurred in Mexico in mid-October. NHTSA said Oct. 24 it found no evidence the first fire resulted from defects or violations of U.S. safety standards. The agency has said it doesn’t investigate vehicle accidents outside the U.S. 
 
 A possible fix for the Model S, priced from $70,000 to more than $100,000, “is not rocket science,” Ditlow said. “Probably the simplest task Tesla has is putting a strong steel shield on the bottom of the car.” 
 
 The Model S has “a six-millimeter thick armor plate on the bottom,” Musk told Bloomberg Television last month. 
 
 A U.S. investigation or recall of the Model S “could raise near-term concerns to a higher level in terms of cost, image and production disruption to Tesla,” Adam Jonas, an analyst for Morgan Stanley, said in a research report yesterday. 
 
 “We would be very surprised if Tesla has not already launched its own investigation into the cause of battery compartment intrusion to explore causes and potential remedies,” said Jonas, who rates the stock overweight. A voluntary recall “would be consistent with Tesla’s extraordinary efforts to build brand value and trust.” 
 
 Battery Issues 
 
 Lithium-ion batteries have come into widespread use in laptop computers, consumer electronics, rechargeable cars and hybrids, and even aircraft, owing to their lighter weight and high energy density. 
 
 Tesla isn’t the first company to experience battery pack-related fires. The U.S. Federal Aviation Administration ordered the grounding of Boeing Co. (BA)’s 787 Dreamliner aircraft this year after meltdowns of lithium-ion batteries. 
 
 NHTSA formally investigated fires in two other battery-powered vehicles, General Motors Co. (GM)’s Chevrolet Volt and Fisker Automotive Inc.’s Karma. 
 
 GM conducted a voluntary program to strengthen the Volt’s battery pack. Fisker, which stopped making plug-in Karmas more than a year ago, issued recalls to fix flawed lithium-ion packs at risk of shutting down and for a separate wiring issue linked to a fire. 
 
 Tesla’s Image 
 
 Multiple reports of battery fires may harm Tesla’s image, said Karl Brauer, an industry analyst for Kelley Blue Book in Irvine, California. 
 
 “At some point the cause of the fire, the safety of the drivers and even the attitude of the owners -- all three apparently want another car -- stops mattering because you’re left with recurring headlines featuring the words ‘Tesla’ and ‘fire,’” Brauer said. 
 
 “For a company with a stock price based as much or more on image than financials, those recurring headlines are highly damaging,” he said. 
 
 Musk’s net worth has more than tripled this year to $7.4 billion, according to the Bloomberg Billionaires Index. Share declines yesterday for both Tesla and SolarCity Corp., another Musk-affiliated company, cut his wealth by $576.8 million, according to data compiled by Bloomberg. 
 
 Musk is Tesla’s largest shareholder. Daimler AG and Toyota Motor Corp. (7203) are also investors in the company. 
 
 The Tennessee Model S fire was first reported on the ValueWalk website, which cited photos of the car fire posted on the Tesla Motors Club forum website. 
 
 To contact the reporters on this story: Alan Ohnsman in Los Angeles at aohnsman@bloomberg.net; Angela Greiling Keane in Washington at agreilingkea@bloomberg.net 
 
 To contact the editor responsible for this story: Jamie Butters at jbutters@bloomberg.net
– Tesla is facing more scrutiny following three car fires in six weeks. First, investors launched a lawsuit; now, the government is getting involved, USA Today reports. The National Highway Traffic Safety Administration is now investigating two of the fires, both of which occurred after Model S undercarriages hit debris on the road (the other happened during a crash). In a blog post, CEO Elon Musk says his company asked for the investigation and writes that "if something is discovered that would result in a material improvement in occupant fire safety, we will immediately apply that change to new cars and offer it as a free retrofit to all existing cars." But the NHTSA tells the LAT a different story: "The agency notified the automaker of its plans to open a formal investigation and requested their cooperation, which is standard agency practice for all investigations." Musk also says the company will increase the cars' ground clearance to help prevent them from hitting debris, and warranties will start covering fire damage, even in the event of driver error, "to reinforce how strongly we feel about the low risk of fire in our cars." To that end: "We believe the evidence is clear that there is no safer car on the road than the Model S," Musk notes. "Since the Model S went into production mid last year, there have been more than a quarter million gasoline car fires in the United States alone, resulting in over 400 deaths and 1,200 serious injuries ... compared to zero deaths and zero injuries due to Tesla fires. The media coverage of Model S fires vs. gasoline car fires is disproportionate by several orders of magnitude, despite the latter actually being far more deadly."