Tesla Inc. (NASDAQ:TSLA) Sued Over Solar Panel Fires In Walmart Inc. (NYSE:WMT) Stores

admin - August 22, 2019

On Tuesday Walmart Inc. (NYSE:WMT) sued Tesla Inc. (NASDAQ:TSLA) blaming the carmaker of negligence that led to repeated fires across its US stores.  Walmart claims that the fires were caused by Tesla’s solar panel systems and requested the court to force the carmaker to remove their systems from its over 240 US stores.

Walmart sues Tesla of negligence that caused fires

According to papers filed at the Supreme Court of New York the solar panel systems installed and maintained by Tesla had caused seven fires at different Walmart locations. The retailer claims there are hazardous problems posed by loose wiring and hot spots on panels. Tesla is being accused of having untrained employees who did a shoddy job in installing the panels demonstrating callousness and sheer incompetence.

Walmart has said the fires destroyed considerable amounts of merchandises and required significant repairs that cost thousands of dollars. The affected stores as of November last year included those in Maryland, Denton, and Beavercreek Ohio. Walmart has been using the solar panel systems made by SolarCity and owned by the carmakers since 2010.

Tesla’s solar panel systems business struggling with waning installations

The lawsuit is the latest setback to the company’s struggling solar business. Tesla acquired SolarCity in 2016 for $2.6 billion but the business has been struggling with installations having plunged over 85%. So far the company has cut is solar panels sales force as well as terminated a distribution agreement with Home Depot Inc. (NYSE: HD).

In July the retailer gave Tesla a month to come up with an analysis of what was the root cause of the fires, overhaul its operations as well as provide compensation for damages to the store. However, the suit indicates that Tesla has since done nothing to rectify the breaches.

Tesla has been struggling to turn profits recently and in the second quarter, the company reported a loss of $408 million. The company launched the solar business to allow consumers to install the solar panel systems without a long term contract as they seek ways of becoming profitable.

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