• by Thom Forbes  @tforbes, October 4, 2013

Elon Musk is facing a Steve Jobs moment in the wake of a literal product meltdown that resulted in headlines yesterday such as this in USA Today: “Tesla stock burned by car fire video, downgrade.”

Jobs, who was famous for enveloping himself in a “reality distortion field” about even his weakest products publicly, privately embraced the lessons learned from his failures. And he realized that “a paralyzing fear of failure….,” as Peter Sims blogged earlier this year in the Harvard Business Review, is the “single most disempowering state of mind you can have if you’d like to be more creative, inventive, or entrepreneurial.”

A Tesla S — a product Musk has touted as “the safest on the road” (to which the feds have taken exception) — caught fire near Kent, Wash., Tuesday, after apparently hitting a “large metallic object,” the company says. A video of flames engulfing the vehicle has garnered more that 1.5 million views on YouTube as of early today. The amateurish 30 seconds are the furthest thing from a spot produced on Madison Ave. as could be imagined. 

“Oh shit, dude, that’s a brand new car,” says the voiceover as the video begins with a long shot from the driver’s window of another vehicle stopped at a traffic light. “Wow, I can feel the heat in here,” our correspondent continues as the camera drives past the scene and captures a fireman aiming a hose at flames leaping out of the front of the vehicle. “Oh, that’s a Tesla, dude … oh, shit,” chimes in his companion as the spot abruptly ends after a shaky vertical of a fire truck.

Forbes’ Hannah Elliott talked yesterday with Elizabeth Jarvis-Shean, Tesla’s director of global communications, and came away with the impression that the company was dancing around the hard questions, although she reiterated the points made in a statement, including that the battery catching fire “was not a spontaneous event.” Musk would not comment directly about the car fire, Elliott was told.

“Wouldn’t it be better to say, ‘We are doing this, this and this’ to fix the problem and calm anxiety about the cars?” Elliott asks. Two experts agree that Tesla should be more proactive, although the story ends with one suggesting that it will “weather the storm.”

“You have to respond openly and honestly with the public, and work through this with N.H.T.S.A.,” consultant Jason Vines tells Bill Vlasic and Christopher Drew in the New York Times. 

The former head of communications at Ford when Explorers “equipped with Firestone tires became prone to disastrous rollovers” went on to say that fire was likely to further color consumers’ perceptions of electric vehicles in general. 

“This could be another stake in the heart of electric vehicles,” Vines says. “It is inevitable that some people are going to say they are just not ready to go on the road.”

Conspiracy theorists are having a field day in social network commentary. “I think it's a setup to scare people from buying electric cars,” says one YouTube commenter. “Oil companies wouldn't want any competition you know.” 

R.W. Baird analyst Ben Kallo’s downgrading of the stock from “outperform” to “neutral” was unrelated to the incident. He told investors “that while he's still bullish on Tesla's long-term prospects, the company has ‘significant milestones’ during the next 18 months that come with risk,” the AP’s Mike Baker reports. All told, the stock dropped 6% yesterday but that’s against a more than 400% surge since the start of the year.

Interestingly, a long-running question on Quora — “Is Elon Musk the next Steve Jobs?” — popped up at the top of its email blast on Monday. Many responses are along the lines of this assessment from Srijan Maulick:. “No, Elon Musk is the first Elon Musk.” Or Sahil Kini’s, “He's the world's first real life Tony Stark.”

Other responses extol Musk’s technology acumen and business sense over Jobs’ more squishy design aesthetics and marketing smarts. Musk himself weighed in on the question last year in an email to Matthew DeBord, who wrote a profile of him for Pasadena magazine.

“I'm a huge admirer of Jobs,” Musk said. “He was incredibly unique and no one will ever really take up his mantle. Also, we are quite different people qualitatively. I do believe strongly in the value of design esthetics, but am much more of a hardcore engineer and technologist.”

Sometimes you can “willfully ignore … naysayers,” as both Musk and Jobs have done to their advantage. Other times, you’ve got to get into the ring and take on the bull. What do you think? Is this one of those times for Musk?