A former Tesla TSLA quality engineer said the electric car maker has known for at least four years that some of its solar panels could catch fire but didn't fix the problem.
On Monday, Reuters revealed that complaints over the alleged hazards filed by the whistleblower are the subject of an ongoing investigation by the U.S. Securities and Exchange Commission. The agency said it was investigating in a Sept. 24 letter to former engineer Steven Henkes, responding to his Freedom of Information Act request.
I was notified by internal documents, third-party engineering reports that Tesla SolarCity knew about this problem well before 2017, Henkes told Yahoo Finance Live.
In 2016 Tesla acquired Solar City for $2.6 billion in a controversial deal that resulted in a shareholder lawsuit. The electric car giant's stock fell by as much as 6% on Monday after reports of the SEC probe, though it pared its losses by the end of the day.
He tried to work internally with Tesla''
Henkes first learned of problems with defective electrical connectors in December 2020, while working for Tesla as a field quality manager. He said he was fired from the company about six months later in August 2020 after reporting his concerns to government regulators.
Tesla has not responded to Yahoo Finance's request for comment, but the company has said it has implemented a remediation plan for panel maintenance.
Henkes' lawyer Robert Wallace told Yahoo Finance that the repairs don't make the panels safe.
They are not being done properly. They are not being done safely. Wallace said that they're not using the proper tools to take care of the problem. Steven originally complained about, but he was fired for it. Wallace says Henkes tried to address the concerns in-house.
Wallace said that he tried to work with Tesla to get the problem fixed. When he was not satisfied, that was when he filed a complaint with the SEC and the U.S. Consumer Products Safety Commission in April of 2019. According to Henkes, his position as field quality manager gave him insight into the alleged risks. He points to Tesla's retrofit, or traditional solar panels, installed between 2015 and late 2018, as a danger.
It was my job to explain and gain consensus to the suppliers who supplied the component that we had a problem, a very large problem in the field, Henkes said. My responsibility was to develop a method for remediation and remanufacturing in the field, and also start up remanufacturing lines. The problems with Tesla's solar panels have been the subject of litigation from residential and commercial customers.
In 2019, Walmart filed a lawsuit against the company, alleging 492 counts of negligence and breach of contract over panels that it said caused seven warehouse fires between 2012 and 2018. Amazon joined Walmart in claiming that one of its warehouses caught fire due to Tesla's panels.
According to Business Insider, the connectors used in its panel installations and manufactured by Amphenol Corp., APH experienced failures and disconnections at a higher rate than our standards allow, though abnormal behavior was exhibited at less than 1% of sites where the connectors were installed. According to the LA Times, Amphenol said its connectors were not responsible for panel fires.
In addition to his complaints to regulators, Henkes filed a lawsuit against Tesla, claiming he was wrongfully terminated in retaliation for his reports. The suit is pending and is scheduled for arbitration in April of next year.
Henkes said that the main intent is to protect the public and to protect families in their homes.
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