A video purportedly of the aftermath showed a line of three cars completely destroyed.
As CNN reports, the incident was recorded by a security camera as the Model S sat parked and not charging in a vehicle park. Import tariffs resulting from the trade war with the United States have seen Tesla prices in China fluctuate wildly.
Tesla said that, to the best of its knowledge, there were no casualties in the fire, while NIO said that no one was hurt in the fire at its fix facility. The incident could add to concern about the safety of electric vehicles using high energy density lithium batteries to extend driving ranges, as rapid expansion of China's EV market pushed sales past 1 million units a year ago.
Tesla(TSLA) said Monday it immediately sent a team to investigate an apparent explosion of one of its cars that occurred in Shanghai on Sunday evening local time.
The latest fire incident comes as Tesla tries to push sales in China, where its prices were impacted by tit-for-tat tariffs imposed during Sino-U.S. trade tensions a year ago.
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The company wants to supercharge sales in China with a new factory in Shanghai.
In March, Tesla was also on the receiving end of a labelling mix-up at Shanghai customs that led to a temporary suspension of clearance for a batch of Model 3 cars. Tesla also used Weibo to make a statement acknowledging the fire and its participation in the investigation.
The user tweeted "Good or bad, negative or positive I will post anything about Tesla or EVs in China".
"One lesson I learnt from the Shanghai self-exploding Tesla: Don't park your auto next to a Tesla", said one commentator.
This isn't the first time one of Tesla's cars has appeared to burst into flames, but previous incidents often involved moving vehicles or vehicles that had crashed. Both companies are investigating the cause of the fires.