Tesla Inc shares fell more than 9 percent on Wednesday following a downgrade by Moody’s Investors Service, a probe by the National Transportation Safety Board of a recent fatal crash and concerns about Model 3 production.
Late on Tuesday, Moody’s Investors Service downgraded Tesla’s credit rating to B3 from B2. Moody’s said the ratings “reflect the significant shortfall in the production rate of the company’s Model 3 electric vehicle.” It also “faces liquidity pressures due to its large negative free cash flow and the pending maturities of convertible bonds.”
Moody’s said Tesla is targeting weekly production of 2,500 Model 3 vehicles by the end of March, and 5,000 per week by the end of June, down from the company’s year-earlier production expectations of 5,000 per week by the end of 2017 and 10,000 by the end of 2018.
Tesla declined to comment on the downgrade. The company plans to provide an update on Model 3 production next week.
Tesla vehicles have a system called Autopilot that handles some driving tasks. The 38-year-old driver of the Tesla died at a nearby hospital shortly after the crash.
Late Tuesday, Tesla said in a blog post it does “not yet know what happened in the moments leading up to the crash,” but added that data shows Tesla owners have driven the same stretch of highway with Autopilot engaged “roughly 85,000 times… and there has never been an accident that we know of.” The company statement did not say if the crashed vehicle had been in Autopilot mode.