Tesla Motors, Inc. TSLA has filed a lawsuit against parts supplier Hoerbiger Automotive Comfort Systems. The automaker had joined hands with Hoerbiger in Feb 2014 to produce a prototype hydraulic system that will open and close the falcon-wing doors of Model X. But the product supplied did not match the quality requirements put down by Tesla. The doors dropped beyond the stated tolerance levels and were found to be leaking oil both inside and outside of the vehicle.



Tesla identified the numerous defects well in time but Hoerbiger failed to fix them. What resulted was a fallout, owing to which Tesla terminated the contract with Hoerbiger in May 2015. As a result, Tesla stopped its payment to the Alabama-based parts supplier.



To date, Tesla has already paid $3 million to Hoerbiger. However, the latter is demanding further payment for its services, which Tesla does not intent to pay, resulting in the current lawsuit. In addition, the electric automaker is demanding penalty for damages and involved legal fees, and a declaration that it didn't breach any contract with Hoerbiger when it broke all ties with the latter.



Tesla incurred several charges including costs related to re-tooling the entire vehicle to support a different engineering solution, costs for testing the Model X vehicle featuring the Hoerbiger hydraulic part, premium payments to a supplier for the alternative electromechanical parts and costs associated with the business disorder.



The falcon-wing doors of Model X are unique in the automotive industry. These doors, are designed to open over the vehicle with the help of a series of electric motors and sensors. The motors and sensors inspect the surroundings and avoid any collision.



Tesla currently carries a Zacks Rank #3 (Hold). Better-ranked automobile stocks include General Motors Company GM, Ferrari N.V. RACE and Autoliv, Inc. ALV, all with a Zacks Rank #2 (Buy).



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