Tesla said Thursday that it delivered 90,650 vehicles in the second quarter, a 4.8% decline from the same period last year prompted by challenges caused by the COVID-19 pandemic that included suspending production for weeks at its main U.S. factory.
Tesla still managed to beat expectations despite the headwinds.
The vast majority of deliveries — some 80,050 — were Model 3 and Model Y vehicles. The remaining 10,600 were its more expensive Model S and Model X vehicles. Tesla doesn’t provide breakdowns of each model separately nor does it give information about regional deliveries.
Analysts, who had anticipated lower numbers due to the COVID-19 pandemic, had varying forecasts with some predicting as few as 39,000 deliveries and as many as 83,000. A consensus of analysts surveyed by FactSet expected Tesla to deliver 72,000 vehicles in the second quarter.
The results pushed shares up nearly 9% in pre-market trading $1,218.21 Thursday morning.
Here’s a quick breakdown:
In the weeks leading up to the end of the second quarter, new sales goals were placed on employees, according to several sources who work for the company. Tesla also reduced the prices of its vehicles in China and North America. Both strategies aimed to spur demand for its electric vehicles.
The scheme appears to have worked in the second quarter, which could prompt analysts to place loftier expectations on Tesla for the remainder of the year.
Tesla shares popped Wednesday after the market opened and pushed the company’s market capitalization to nearly $208 billion, surpassing Toyota to become the world’s most valuable automaker by market value. The shares rose in part on reports of a companywide email from CEO Elon Musk congratulating employees on reaching its sales and production goals.
Tesla hits a financial milestone, Discord is now valued at $3.5 billion and we unpack the phenomenon.
Here’s your Daily Crunch for July 1, 2020.
In 10 years, Tesla has gone from public market newbie to the most valuable automaker in the world. The electric automaker had long since passed the valuations of Ford and GM — and in January, it became the most valuable U.S. automaker ever when its market capitalization hit $81.39 billion.
Still, a few automakers remained ahead of Tesla globally, until today. Tesla shares popped this morning, and the company’s market cap now stands at nearly $208 billion, surpassing Toyota.
“It turns out that, for a lot of you, it wasn’t just about video games anymore,” wrote co-founders Jason Citron and Stanislav Vishnevskiy in a blog post. Discord, they said, is “a place to have genuine conversations and spend quality time with people, whether catching up, learning something or sharing ideas.”
In 36 hours, a diverse group of young entrepreneurs and technologists used a mysterious meme to raise more than $200,000 for three charities supporting people of color and the LGBTQ community: The Okra Project, The Innocence Project and The Loveland Foundation.
Facebook took action to remove a network of accounts Tuesday related to the “boogaloo” movement, a firearm-obsessed anti-government ideology that focuses on preparing for and potentially inciting a U.S. civil war.
Lawyer Sophie Alcorn lays out the current immigration landscape for a Bay Area recruiter. (Extra Crunch membership required.)
The bump in pricing is now one of several price increases YouTube TV has seen since its debut, due to the rising costs of programming for the streaming TV service — with the cord cutting trend now accelerating due to the pandemic.
NASA has announced its latest batch of small business grants, providing more than 300 businesses a total of $51 million in crucial early-stage funding. These “phase I” projects receive up to $125,000 to help bring new technologies to market.
The Daily Crunch is TechCrunch’s roundup of our biggest and most important stories. If you’d like to get this delivered to your inbox every day at around 9am Pacific, you can subscribe here.
The National Highway Traffic Safety Administration has opened a preliminary investigation into allegations of failing touchscreens on Tesla’s older Model S vehicles.
The federal agency launched the probe after receiving 11 complaints from Tesla owners over a 13-month period alleging failures of the touchscreen in 2013 through 2015 Model S vehicles. The problem, which stems from a problematic flash memory device, renders the touchscreen black, including the loss of the rear camera image display when reverse gear is selected.
The focus of NHTSA’s preliminary evaluation is an Nvidia Tegra 3 processor with an integrated 8GB eMMC NAND flash memory device. The flash devices have a finite lifespan that is based on the number of program and erase cycles. The central display, or media control unit, allegedly fails prematurely because the memory wears out in the eMMC NAND flash. NHTSA initially estimated 63,000 Model S vehicles, which use this flash memory device, are potentially affected. However, the federal agency notes that the number could be as large as 159,000 vehicles. The Tegra 3 processor was used in 2012 to 2018 Model S sedans and 2016 to 2018 Model X SUVs.
The touchscreen in Tesla vehicles, which include infotainment, navigation and web browsing, have been both hailed for its design and criticized for its glitchy tendencies, particularly around the flash memory device.
NHTSA said the eMMC memory wears out after periods of progressively degraded performance. The final failure results in loss of audible and visual features, including loss of rear camera image display when reverse gear is selected. Other effects of MCU failure include climate control defaulting to Auto mode and limits on battery charging current and maximum state of charger when recharging. The failure doesn’t affect vehicle control systems such as braking, speed control or steering.
Ford will start offering a hands-free driving feature in the second half 2021, beginning with its new Mustang Mach-E electric vehicle.
The hands-free feature, called Active Drive Assist, is part of a larger package of advanced driver assistance features collectively called Ford Co-Pilot360 Active 2.0 Prep Package. But it’s the hands-free offering that is getting all of the attention today.
The hands-free feature has been anticipated since the Mustang Mach-E — which has a driving monitoring system situated above the steering wheel — was revealed last year.
There are important caveats to Ford’s announcement. The tech, while notable, won’t be available everywhere and in every Ford vehicle. Drivers who want the feature will have to buy a 2021 Mustang Mach-E and the additional Active 2.0 Prep Package, which includes the proper hardware, such as sensors to support the system. The software is purchased separately and at a later date once it’s ready. The software can be added either at a dealership or via over-the-air updates in the third quarter of 2021, Ford said. And all this will come at a price, which is still unknown.
The hands-free feature will work on about 100,000 miles of pre-mapped, divided highways in the U.S. and Canada. The monitoring system will include an advanced infrared driver-facing camera that will track eye gaze and head position to ensure drivers are paying attention to the road. The DMS will be used in the hands-free mode and when drivers opt for lane-centering mode, which works on any road with lane lines. Drivers who don’t keep their eyes forward will be notified by visual prompts on their instrument cluster.
This “prep package” also includes the latest iteration of park assist, which will handle maneuvering into parallel and perpendicular spaces. It also offers a “Park Out Assist” feature, with side-sensing capability that helps drivers navigate out of a parking spot when someone’s parked too close.
Ford made a point of comparing its system in the Mustang Mach-E to Tesla’s Model Y. In particular, Ford notes that it is hands-free, while Tesla’s driver assistance system, known as Autopilot, is not. But the comparison doesn’t quite square.
A better comparison might be with its rival GM, which has taken a similarly cautious approach to introducing its hand-free driving system known as Super Cruise, which also has a driver-monitoring system. GM limited Super Cruise to just one Cadillac branded model, the full-size CT6 sedan, and restricted its use to certain divided highways. Over the past year, GM has improved the capabilities of the feature, expanded where it can be deployed and is offering it in other models.
In another up for technology shares, software companies saw their values reach new heights today.
The days trading comes after a selloff last week eased some of technology companies’ rebounds from their COVID-19 lows; stocks in tech companies have more than made up for their early-year declines in mid-2020, with the Nasdaq reaching 10,000 points before giving up some ground.
Today the Nasdaq Composite index rose 0.15% to 9,910.53 points, just a few bips short of its all-time highs. A thematic tech index focused on fintech also saw their values recover to a mote under previous highs. The S&P 500 fell 0.36% to close at $3,113.41 and the Dow Jones Industrial Average Index decreased 0.65% to $26,119.13.
But software companies, tech’s highest fliers, set broached new records as measured by the Bessemer cloud index. According to the Financial Times, the software-and-cloud tracking index has seen gains of over 45% during the last year, a sharp advance during a year of economic uncertainty and occasional stock market carnage.
Looking around more broadly, tech shares with a bit more of a value flavor — GAAP profitability, regular dividends, etc. — performed well with Apple setting new record highs as well. The smartphone giant and services shop is worth more than $1.5 trillion underscoring how attractive stable-tech has proved in 2020. On the same theme, Microsoft is a few points from all-time highs, and is worth around $1.48 trillion.
But while software’s growth has proved attractive, as has the stability of megacorp tech shops, less certain bets have also proved attractive. Nikola, an electric vehicle company that went public recently in a reverse debut is still worth around $26 billion despite having no reported revenue. On a similar theme, Tesla shares are up from around $225 a year ago to over $993 today, a gain of 340% or so. In Q1 2020 the company posted 38% year-over-year growth.
$420 per share feels a long time ago.
Speaking of transportation, Uber and Lyft had separate announcements Wednesday that should have primed the ol’ investor pump. Instead, shares of both companies bopped from flat to slightly down throughout the day.
Uber announced Wednesday that it will manage an on-demand service for Marin County in the San Francisco Bay area marking the company’s broader push Software as a Service and public transit.
Transportation Authority of Marin (TAM) will pay Uber a subscription fee to use its management software to facilitate requesting, matching and tracking of its high-occupancy vehicle fleet, starting with a service that operates along the Highway 101 corridor. Marin Transit trips will show up in the Uber app and let users book and even share rides.
This fundamental piece of news should have appealed to investors. Today they responded with a resounding ‘meh’ even though it represents the first steps into generating a new stream of revenue.
Uber shares closed down 0.60% to $33.29.
Meanwhile, rival Lyft pledged Wednesday that every car, truck and SUV on its platform will be all electric or powered by another zero-emission technology by 2030, a commitment that will require the company to coax drivers to shift away from gas-powered vehicles.
The target, which Lyft plans to pursue with help from the Environmental Defense Fund, will stretch across multiple programs. It will include the company’s autonomous vehicles, the Express Drive rental car partner program for ride-share drivers, consumer rental cars for riders and personal cars that drivers use on the Lyft app.
Perhaps, investors understand that even with a decade-long timeline, the target could be difficult to meet.
Lyft shares closed at $35.32, down 3.79%
TechCrunch has slowed its public market coverage as tech equities have returned to a more stable period; that they have made back lost ground has been worth noting, but lower volatility has lowered the market’s newsworthiness. Still, from time-to-time when new all-time highs are hit, it’s worth putting our toes back into the water. And on days when different blocs of public tech set records, we can’t help but make a public note.
Tech and tech-ish stocks: still in fashion.
GM’s electric offensive to bring at least 20 new EVs to market by 2023 reportedly includes a commercial van.
Reuters reported Thursday that the company is developing an electric van for the commercial market code named BV1. The vehicle is expected to start production in late 2021 and will use the Ultium battery system that was revealed in March, according to the report.
When, and if, GM delivers on that goal in 2021 it will join an increasingly crowded pool. Amazon ordered 100,000 electric delivery vans from Rivian, the first of which are expected to be on the road in 2021. Ford has announced an electric Transit van that’s expected to launch in 2021. Startups such as Arrival, Chanje, Enirde, and XoS have received orders for electric vans from package delivery companies such as Ryder and UPS.
Tesla is one outlier that hasn’t revealed plans to produce commercial electric vans. GM’s move has been cast as a strategy to get ahead of Tesla in the commercial marketplace.
But there are likely other reasons driving GM’s decision, including high margins that can be achieved selling commercial trucks and vans as well as governments enacting increasingly strict emissions laws, particularly in urban centers.
Electric vans are logical fit for delivery companies, which tend to have predictable routes, a specific geographic area and operate a high utilization all of which fits with the EV infrastructure and charging ecosystems that enables their full economic use, a research note released Thursday from Morgan Stanley argues.
Morgan Stanley notes it hasn’t been “smooth sailing” for all EV vans. For instance, DHL’s StreetScooter program was recently shut down.
Prior to Reuters’ report, it appeared GM’s EV strategy was pinned to passenger vehicles. In March, GM revealed an electric architecture that will be the foundation of its future EV plans and support a wide range of products across its brands, including compact cars, work trucks, large premium SUVs, performance vehicles and a new Bolt EUV crossover expected to come to market next summer.
GM said the modular architecture, called “Ultium,” will be capable of 19 different battery and drive unit configurations, 400-volt and 800-volt packs with storage ranging from 50 kWh to 200 kWh, and front-, rear- and all-wheel drive configurations.
GM’s focus on making this EV architecture modular underlines the automaker’s desire to electrify a wide variety of its business lines, from the Cruise Origin autonomous taxi and compact Chevrolet Bolt EUV to the GMC HUMMER electric truck and SUV and the newly-announced Cadillac Lyriq SUV. GM also showed a variety of electric vehicles that had not yet been announced, to show how this modularity will be exploited further out in their product plan, including a massive Cadillac flagship sedan called Celestiq.
Audi has created a new business unit called Artemis to bring electric vehicles equipped with highly automated driving systems and other tech to market faster — the latest bid by the German automaker to become more agile and competitive.
The traditional automotive industry, where the design to start of production cycle might take five to seven years, has been grappling with how to bring new and innovative products to market more quickly to meet consumers’ fickle demands. The model is more akin to how Tesla or a consumer electronics company operates.
The first project under Artemis will be to “develop a pioneering model for Audi quickly and unbureaucratically,” Audi AG CEO Markus Duesmann said in a statement Friday. The unit is aiming to design and produce what Audi describes as a “highly efficient electric car” as early as 2024.
Artemis will be led by Alex Hitzinger, who was in charge of Audi’s Autonomous Intelligent Driving, the self-driving subsidiary that was launched just in 2017 to develop autonomous vehicle technology for the VW Group. AID was absorbed into the European headquarters of Argo AI, a move that was made after VW invested $2.6 billion in capital and assets into the self-driving startup.
Hitzinger, who takes the new position beginning June 1, will report directly to Duesmann. Artemis will be based at the company’s tech hub of its INCampus in Ingolstadt, Germany.
Artemis is under the Audi banner. However, the aim is for this group’s work to benefit brands under its parent company VW Group. Hitzinger and the rest of his team will have access to resources and technologies within the entire Volkswagen Group . For instance, Car.Software, an independent business unit under the VW Group, will provide digital services to Artemis. The upshot: to create a blueprint that will make VW Group a more agile automaker able to bring new and technologically advanced vehicles to market more quickly.
VW Group plans to produce and sell 75 electric vehicle models across its brands by 2029, a group that includes VW passenger cars and Audi. The creation of Artemis hasn’t changed Audi’s plans to produce 20 new all-electric vehicles and 10 new plug-in hybrids by 2025.
“The obvious question was how we could implement additional high-tech benchmarks without jeopardizing the manageability of existing projects, and at the same time utilize new opportunities in the markets,” Duesmann said.
NASA and SpaceX are closer than ever to a moment both have been preparing for since the beginning of the Commercial Crew program in 2010. SpaceX’s Falcon 9 and Crew Dragon spacecraft are now set to fly with NASA astronauts Doug Hurley and Bob Behnken onboard, making a trip to the International Space Station, and both the agency and SpaceX announced today that they have officially passed the final flight readiness review, meaning everything is now a ‘go’ for launch.
According to NASA Commercial Crew Program manager Kathy Leuders during a press conference on Monday, everything went well with all pre-launch flight checks thus far, including a full-length static test fire of the Falcon 9’s engines, and a dress rehearsal of all launch preparation including strapping Hurley and Behnken into the rocket.
The only remaining major hurdle for SpaceX and NASA now is the weather, which is currently only looking around 40% favorable for a launch attempt on schedule for Wednesday, May 27 at 4:33 PM EDT, though during today’s press conference officials noted it is actually trending upwards as of today.
SpaceX and NASA will be paying close attention to the weather between now and Wednesday, and since this is a highly sensitive mission with actual astronauts on board the spacecraft, you can bet that they’ll err on the side of caution for scrubbing the launch if weather isn’t looking good. That said, they do have a backup opportunity of May 30 in case they need to make use of that.
Hans Koenigsmann, VP of Mission Assurance at SpaceX, noted that there were “no showstoppers” during the static test fire on Friday, and also commented that seeing the actual astronauts climb aboard the Crew Dragon during the dry dress rehearsal really drove home the seriousness and impact of this moment. It will mark the first ever human spaceflight for SpaceX, and the first time astronauts have launched from U.S. soil since the end of the Space Shuttle program in 2011.
Koenigsmann went through the schedule for launch day, which include Behnken and Hurley getting ready and suited up around 4 hours before, be drive over in the custom Tesla Model X astronaut transit vehicle at around 3 hours prior, and get into the capsule at around 2.5 hours before launch time. The rest from there is somewhat similar to other Falcon 9 launches, he said, with the exception of the escape system arming at 45 minutes prior to launch, and the arm retracting 10 minutes later, at which point the automated launch system takes over just like it does for other Falcon 9 flights.
Post-launch, Behnken and Hurley will spend 19 hours on orbit, with orbit-raising burns and also a manual flight test (the rest of the time Crew Dragon should be under fully automated control) for around 30 minutes just prior to docking. Then, it’ll dock and open the hatch around 2 hours later.
The departure schedule for Behnken and Hurley to leave the ISS is in flux – NASA will provide that date, sometime between 6 weeks and 16 weeks from launch. The astronauts will then back into Dragon, suit up, undock from the station, and land in the Atlantic around two hours later for recovery.
This is the culmination of many years’ work, and will be the first human flight for the Commercial Crew program. If all goes well, SpaceX could then begin flying astronauts during regular operational missions for ferrying astronauts to and from the Space Station as early as later this year.
In the days and weeks after Tesla CEO Elon Musk revealed the cybertruck — a post-apocalyptic inspired vehicle made of cold-rolled steel — there was a lot of speculation about whether it would be smaller once it actually made it to market.
Production of the Cybertruck is still a long ways off. There isn’t even a factory to build the all-electric truck yet. However, Musk did provide some clarification Saturday on its size. In a tweet, Musk wrote “Reviewed design with Franz last night. Even 3% smaller is too small. Will be pretty much the same size. We’ll probably do a smaller, tight world truck at some point.” (Musk was referring to Tesla’s head of design Franz von Holzhausen. And we assume Musk meant to write “light” not “tight” truck.)
Musk had previously said the company could probably reduce the width of the cybertruck by an inch and “maybe reduce length by 6-plus inches without losing on utility or esthetics.”
Reviewed design with Franz last night. Even 3% smaller is too small. Will be pretty much this size. We’ll probably do a smaller, tight world truck at some point.
Tesla hasn’t shared the dimensions of the vehicle. And TechCrunch failed to bring a measuring tape at the launch. (Lesson learned).
In the past two months, Musk has provided a few other updates around the cybertruck via Twitter, noting that the company is increasing dynamic air suspension travel for better off-roading and that it “will float for awhile,” a claim he didn’t explain further.
Tesla said it will offer three variants of the cybertruck. The cheapest version, a single motor and rear-wheel drive model, will cost $39,900, have a towing capacity of 7,500 pounds and more than 250 miles of range, according to specs on its website. The middle version will be a dual-motor all-wheel drive, have a towing capacity of more than 10,000 pounds and be able to travel more than 300 miles on a single charge. The dual motor AWD model is priced at $49,900.
The third version will have three electric motors and all-wheel drive, a towing capacity of 14,000 pounds and battery range of more than 500 miles. This version, known as “tri motor,” is priced at $69,900.
Tesla has officially dismissed a lawsuit filed earlier this month against Alameda County that sought to force the reopening of its factory in Fremont, California.
The dismissal, which was granted Wednesday, closes the loop on a battle between Tesla CEO Elon Musk and county health and law enforcement officials. The lawsuit filed May 9, hours after Musk threatened to sue and move operations out of state, sought injunctive and declaratory relief against Alameda County. Reuters was the first to report the dismissal.
The lawsuit was filed after Tesla’s plans to resume production at the Fremont factory were thwarted by the county’s decision to extend a stay-at-home order issued to curb the spread of COVID-19, the disease caused by coronavirus.
Musk had based the reopening on new guidance issued by California Gov. Gavin Newsom that allows manufacturers to resume operations. However, the governor’s guidance included a warning that local governments could keep more restrictive rules in place. Alameda County, along with several other Bay Area counties and cities, extended the stay-at-home orders through the end of May. The orders were revised and did ease some of the restrictions. However, it did not lift the order for manufacturing.
After several days of Twitter rants and negotiations with the county, Tesla was allowed to begin to reopen its factory as long as it adhered to approved safety measures.
GM has a “big team” working on an advanced version of its hands-free driving assistance system, Super Cruise, that will expand its capability beyond highways and apply it to city streets, the automaker’s vice president of global product development Doug Parks said Tuesday.
GM is also continuing to improve its existing Super Cruise product, Parks said during a webcasted interview at Citi’s 2020 Car of the Future Symposium.
“As we continue to ratchet up Super Cruise, we continue to add capability and not just highway roads,” Parks said, adding that a separate team is working on the hands-free city driving product known internally as “Ultra Cruise.”
“We’re trying to take that same capability off the highway,” he said. “Ultra cruise would be all of the Super Cruise plus the neighborhoods, city streets and subdivisions. So Ultra Cruise’s domain would be essentially all driving, all the time.”
Parks was quick to add that this would not be autonomous driving. Advanced driving assistance systems have become more capable, but they still require a human driver to take control and to be paying attention.
“What we’re not saying is that Ultra Cruise will be fully autonomous 100% of the time, although that could be one of the end games,” Parks said.
Parks didn’t provide a timeline for when Ultra Cruise might be available. A GM spokesperson said in a statement after his interview that the company continues to expand its hands-free driver assistance system technology across its vehicle portfolio and has “teams looking at how we can expand the capabilities to more scenarios.”
GM said it “does not have a name or anything specific to announce today, but stay tuned.”
This new Ultra Cruise feature would put it in competition with Tesla’s Autopilot advanced driving system, which is largely viewed as the most capable on the market today. Tesla’s “full self-driving” package, a more capable version of Autopilot, can now identify stop signs and traffic lights and automatically slows the car to a stop on approach. This feature is still considered to be in beta.
GM’s Super Cruise uses a combination of lidar map data, high-precision GPS, cameras and radar sensors, as well as a driver attention system, which monitors the person behind the wheel to ensure they’re paying attention. Unlike Tesla’s Autopilot driver assistance system, users of Super Cruise do not need to have their hands on the wheel. However, their eyes must remain directed straight ahead.
GM has taken a slower approach to Super Cruise compared to Tesla’s method of rolling out software updates that gives early access to some owners to test the improved features. When GM launched Super Cruise in 2017, it was only available in one Cadillac model — the full-size CT6 sedan — and restricted to divided highways. That began to change in 2019 when GM announced plans to expand where Super Cruise would be available.
GM’s new digital vehicle platform, which provides more electrical bandwidth and data processing power, enabled engineers to add to Super Cruise’s capabilities. In January, GM added a feature to Super Cruise that automated lane changes for drivers of certain Cadillac models, including the upcoming 2021 Escalade.
This enhanced version of Super Cruise includes better steering and speed control. The improved version will be introduced starting with the 2021 Cadillac CT4 and CT5 sedans, followed by the new 2021 Cadillac Escalade. The vehicles are expected to become available in the second half of 2020.
Tesla officials visited two sites in Tulsa, Oklahoma this week to search for a location for its future and fifth gigafactory that will produce its all-electric Cybertruck and Model Y crossover, a source familiar with the situation told TechCrunch.
Company representatives also visited Austin. A final decision has not been made, but Austin and Tulsa are among the finalists, according to multiple sources. The AP also reported Tulsa and Austin as top picks for the gigafactory.
Tesla expects to make a decision as soon as next month, and “certainly within three months,” CEO Elon Musk said April 29 during the company’s first quarter earnings call.
Musk tweeted in March that Tesla was scouting locations for a so-called “Cybertruck Gigafactory.” Musk said, at the time, that the factory would be located in the central part of the U.S. and would be used to produce Model Y crossovers for the East Coast market as well as the cybertruck.
Not long after the tweets, TechCrunch learned that Tesla was eyeing Nashville and had been in talks with officials there. Tesla informed Nashville officials this week that the city is out of the running for its gigafactory location, according to one source.
An email was sent to Tesla requesting comment. The article will be updated if Tesla responds.
Tulsa Mayor G.T. Bynum’s office issued a statement neither confirms nor denies the talks.
“While I can not comment on potential projects, it is clear that Tesla and Tulsa were forged in the same spirit,” Bynum said in an emailed statement. “Both founded by pioneers who dreamt big and made it happen. Both trying to change the world with a new kind of energy. Both investing big in what matters most: people. Tulsa is a city that doesn’t stifle entrepreneurs – we revere them. And as Tesla continues to rapidly change transportation all around the world, I can’t imagine a better place for them to further that important work than Green Country.”
This next gigafactory, wherever it is located, will likely be larger and produce multiple products, CFO Zachary Kirkhorn said during the same April 29 call.
“That’s under a belief that there’s significant efficiencies by having as much as possible and similar product lines under the same roof and as much vertical integration as possible all in one facility,” Kirkhorn said.
Musk has referred to these as future plants as “tera” factories — a nod to terawatt, or more specifically a terawatt-hour of battery capacity. The company’s first “gigafactory” is in Sparks, Nevada. The massive structure, which has surpassed. 1.9 million square feet, is where Tesla produces battery packs and electric motors for its Model 3 vehicles. The company has a joint venture with Panasonic, which is making the lithium-ion cells.
Tesla dubbed the Sparks plant a “gigafactory” because the company said at the time it would be capable of producing 35 gigawatt-hours per year of battery cells.
Tesla assembles its Model S, Model X and Model 3 vehicles in Fremont, Calif. at a factory that was once home to GM and Toyota’s New United Motor Manufacturing Inc (NUMMI) operation. Tesla acquired the factory in 2010. The first Model S was produced at the factory in June 2012.
“Gigafactory 2” in Buffalo, New York, is where Tesla produces solar cells and modules. The company’s third gigafactory is located in Shanghai, China and started producing the Model 3 late last year. The first deliveries began in early January.
Tesla is now preparing to build another factory near Berlin. Once complete, this German factory will produce the Model 3 and Model Y for the European market.
Autotech Ventures popped on the scene three years ago with a $120 million debut fund and a plan to invest in early-stage ground transportation startups. Now, with investments in 26 startups and a handful of exits, including Xnor.ai, DeepScale and Frontier Car Group, the venture firm is back with a new, bigger fund and the same strategy.
Autotech Ventures has raised more than $150 million in its second fund with capital commitments from both financial and corporate investors, including Volvo Group Venture Capital AB, Lear, Bridgestone and Stoneridge, as well as other vehicle manufacturers, parts suppliers, repair shop chains, leasing corporations, dealership groups and trucking firms.
The new fund brings the firm to more than $270 million under management to date.
While Autotech’s funds include institutional financial investors, it has largely focused on corporation.
“The corporate LP base is a key part of our strategy as a firm and a key differentiator for us,” Daniel Hoffer, managing director at Autotech, said in a recent interview with TechCrunch. “At a high level we provide capital, transportation market intelligence and access to large corporations in the industry, including our LPs. Startups really value those connections because we can accelerate their go-to market and their distribution channels in addition to providing greater access to other forms of business development and even M&A opportunities.”
The firm typically aims for the seed and Series A sweet spot. But it occasionally will participate in Series B and later-stage funding rounds, Hoffer said. Its new $150 million-plus fund will target early-stage startups in several sectors that fall under the “ground transportation and mobility” umbrella, including connectivity, autonomy, shared-use mobility, electrification and digital enterprise applications.
Autotech Ventures does invest globally, although the majority of its investments are in the U.S. Outside of North America, the firm has a proportionate interest in Europe and Israel, according to Hoffer.
Some of its notable investments include computer vision startup DeepScale (which was snapped up by Tesla last year), Lyft, used vehicle marketplace operator Frontier Car Group, Outdoorsy, Swvl, parking app SpotHero, Volta Charging and Xnor.ai, which Apple acquired in January.
Hoffer said the firm is sensitive to the well-hyped trends, such as autonomous vehicle technology, that everybody is chasing, but it also is interested in the more niche opportunities that people might be less aware of.
The COVID-19 pandemic, which has upended the shared mobility sector, ride-hailing and public transportation, has Hoffer and his fellow Autotech venture capitalists focused on logistics and supply chain visibility — two areas that have promise in this “COVID-oriented world.”
Autotech is also interested in overlooked opportunities, such as software that enables the industry to execute recalls, and even visibility into junkyard inventory, Hoffer added. The company also sees investment opportunities in “off highway” autonomous vehicle technology ventures, such as in mining and construction.
Ever since the Tesla Model 3 came to market in 2017 there’s been widespread speculation about an interior camera that’s hidden in the rearview mirror and faces into the car’s cabin.
Tesla CEO Elon Musk has said the camera is there to support the company’s eventual robotaxi plans or even record sing-along sessions with the vehicle’s Caroake feature. But there have also been hints that the camera would be used to recognize people in the vehicle and automatically deliver personalized features.
But wait. Now, it appears the cabin-facing camera could also be used for video conferencing. Sure, why not?
Video conferencing within a Tesla will be “definitely a future feature,” Musk wrote on Twitter in response to a question from the Tesla Owners Silicon Valley group.
Yeah, definitely a future feature
— Elon Musk (@elonmusk) May 5, 2020
How or when this feature might appear isn’t important. Details like whether it will be active even while someone is driving are boring.
Today, Tesla’s entertainment features like its video games or streaming Netflix can only be used when the vehicle is in park. The Caroake feature can be deployed while driving, although a message pops up saying that the lyrics, which are displayed on the central screen, are only for passengers. A confirmation button that reads “I am a passenger” is also displayed before launching.
But that doesn’t mean the video conferencing feature will have the same constraints. Just a few days ago, Musk talked about creating a game like a complex version of Pac-Man or Mario Kart that interacts virtually with reality. In other words, could be played while driving on roads.
Anyone think they can get a good multiplayer Minecraft working on Teslas? Or maybe create a game that interacts virtually with reality like Pokémon Go while driving safely? Like a complex version of Pac-man or Mario Kart?
— Elon Musk (@elonmusk) May 3, 2020
Volvo Cars will start producing vehicles in 2020 that are equipped with lidar and a perception stack — technology developed by Silicon Valley startup Luminar that the automaker will use to deploy an automated driving system for highways.
For now, the lidar will be part of a hardware package that consumers can add as an option to their Volvo vehicle, starting with the second-generation XC90. Volvo will combine Luminar’s lidar with cameras, radar, software and back-up systems for functions such as steering, braking and battery power to enable its highway pilot feature.
Volvo, which is known for making its advanced safety features standard, sees a bigger opportunity in its partnership with Luminar. The Swedish automaker said Luminar will help it improve advanced driver assistance systems and may lead to all of its second-generation Scalable Product Architecture (SPA2) vehicles to come with lidar as a standard feature.
The announcement is a milestone for Luminar and its whiz founder Austin Russell, who burst onto the autonomous vehicle startup scene in April 2017 after operating for years in secrecy. It also makes Volvo the first automaker to equip production vehicles with lidar — the light detection and ranging radar that measures distance using laser light to generate a highly accurate 3D map of the world around the car.
Luminar’s Iris lidar sensors — which TechCrunch has described as about the size of really thick sandwich and one-third smaller than its previous iterations — will be integrated in the roof. The sensor’s tucked away placement is a departure from the bucket style spinning lidars that have become synonymous with autonomous vehicle development.
Shipping a vehicle with the proper hardware and perception stack doesn’t mean customers will be able to let their Volvo take over driving on highways from the get go. The software, which is being developed by Zenuity, is still underway, Volvo CTO Henrik Green said.
The software will be activated wirelessly once it is verified to be safe in individual geographic locations. Volvo will continue to expand the capability of the software such as pushing up the maximum speed a vehicle can travel while driving autonomously. This hardware first-continual software update strategy is similar to Tesla, which has sold an automated driving package to consumers for years that has improved over time, but still does not allow for so-called “full self-driving.”
“Soon, your Volvo will be able to drive autonomously on highways when the car determines it is safe to do so,” Green said. “At that point, your Volvo takes responsibility for the driving and you can relax, take your eyes off the road and your hands off the wheel. Over time, updates over the air will expand the areas in which the car can drive itself. For us, a safe introduction of autonomy is a gradual introduction.”
Lidar sensors are considered by many automakers and tech companies an essential piece of technology to safely roll out autonomous vehicles. In the past 18 months, as the timeline to deploy commercial robotaxi fleets has expanded, automakers have turned back to developing nearer term tech for production vehicles.
“It’s a very isolated problem to solve and becomes a lot more solvable in a safe way than trying to solve autonomous driving through the inner city of Los Angeles or San Francisco,” Green said. “By narrowing the use case to those particular highways, we can bring safe autonomy into vehicles for personal use in the timeframe we’re talking about.”
Advanced driver assistance systems, or ADAS, that was pushed aside in pursuit of fully autonomous vehicles has become a darling once again. It’s prompted a pivot within the industry, particularly with lidar companies. Dozens of lidar startups once grappling to become the supplier of choice for fully driverless vehicles are now hawking their wares for use in regular old passenger cars, trucks and SUVs. Some lidar startups such as Luminar have developed the perception software as well in an effort to diversify their business and offer a more appealing package to automakers.
The companies will deepen their collaboration to ensure Luminar’s lidar technology is validated for series production. Volvo Cars said it has signed an agreement to possibly increase its minority stake in Luminar.
Happy Saturday and welcome back to an Equity Shot, a short-form episode of Equity where we drill into one particular topic. There was so much news this week in our main areas of focus — startup funding rounds, new venture funds, that sort of thing — that we had to exclude earnings from the main show! (But really, check it out, as it was a good time.)
Sad, I know. Everyone surely noticed the loss, but we gathered once again on Friday afternoon to dig into the results all the same. A big thanks to Danny, Natasha and Chris for gathering ’round one more time to get through:
We avoided Tesla because who can be bothered, and managed the shortest note on Apple ever recorded on a business podcast. All that and we had some fun. Hugs from Equity; we’ll be right back Monday morning!
Tesla CEO Elon Musk tweeted Friday that the company’s stock price was “too high” in his opinion, immediately sending shares into a free fall and in possible violation of an agreement reached with the U.S. Securities and Exchange Commission last year.
Tesla shares fell nearly 12% in the half hour following his stock price tweets — just one of many sent out in rapid fire that covered everything from demands to “give people back their freedom” and lines from the U.S. National Anthem to quotes from poet Dylan Thomas and a claim that he will sell all of his possessions.
Tesla shares rebounded later in the day to close at $701.32 a share, a 7.17% decline from the opening.
The SEC declined to comment on whether this was a violation of a settlement agreement. Tesla did not respond to a request for comment. Musk did tell The Wall Street Journal in an email that he was not joking and that his tweets were not vetted in advance, a condition in the prior agreement reached with the SEC.
Musk’s tweet comes almost exactly a year after he reached a settlement agreement with the U.S. Securities and Exchange Commission that gave the CEO freedom to use Twitter — within certain limitations — without fear of being held in contempt for violating an earlier court order.
Under that agreement, Musk can tweet as he wishes except when it’s about certain events or financial milestones. In those cases, Musk must seek pre-approval from a securities lawyer, according to the agreement filed in April 2019 with Manhattan federal court.
Musk is supposed to seek pre-approval if his tweets include events regarding the company’s securities, including his acquisition or disposition of shares, nonpublic legal or regulatory findings or decisions.
He’s also supposed to get pre-approval on any tweets about the company’s financial condition or guidance, potential or proposed mergers, acquisitions or joint ventures, sales or delivery numbers, new or proposed business lines or any event requiring the filing of a Form 8-K, such as a change in control or a change in the company’s directors.
His scuffle with the SEC stretches back to Musk’s now infamous August 7, 2018 tweet that had “funding secured” for a private takeover of the company at $420 per share. The SEC filed a complaint in alleging that Musk had committed securities fraud.
Musk and Tesla settled with the SEC in 2018 without admitting wrongdoing. Tesla agreed to pay a $20 million fine; Musk had to agree to step down as Tesla chairman for a period of at least three years; the company had to appoint two independent directors to the board; and Tesla was also told to put in place a way to monitor Musk’s statements to the public about the company, including via Twitter.
But the problems between the CEO and federal agency re-ignited after Musk sent a tweet on February 19, 2019 that Tesla would produce “around” 500,000 cars this year, correcting himself hours later to clarify that he meant the company would be producing at an annualized rate of 500,000 vehicles by year end.
A stay-at-home order for seven San Francisco Bay Area counties will be extended through the end of May due to the COVID-19 pandemic, a decision that affects 7 million residents and thousands of businesses.
The Public Health Officers of the Counties of Alameda, Contra Costa, Marin, San Francisco, San Mateo, and Santa Clara as well as the City of Berkeley said in a joint statement issued Monday that it will issue revised shelter-in-place orders later this week. The new order will ease some specific restrictions for what the health officers from the seven counties described as a “small number of number of lower-risk activities.”
The stay-at-home orders were set to expire May 3. Details regarding this next phase will be shared later in the week, along with the updated order.
“Thanks to the collective effort and sacrifice of the 7 million residents across our jurisdictions, we have made substantial progress in slowing the spread of the novel coronavirus, ensuring our local hospitals are not overwhelmed with COVID-19 cases, and saving lives,” the health officers said in a joint statement. “At this stage of the pandemic, however, it is critical that our collective efforts continue so that we do not lose the progress we have achieved together.”
The public health officials said Monday that hospitalizations have leveled, but more work is needed to safely re-open communities and warned that “prematurely lifting restrictions could lead to a large surge in cases.”
The health officers plan to also release a set of broad indicators used to track progress in preparedness and response to COVID-19, in alignment with the framework being used by the rest of the state.
Properly equipped Tesla vehicles can now recognize and respond to traffic lights and stop signs thanks to a software update the company started pushing out to owners over the weekend.
The software update had been available to a sliver of Tesla owners, some of whom had posted videos of the new capability. Now, the automaker is pushing the software update (2020.12.6) to the broader fleet.
The feature isn’t available in every Tesla vehicle on the road today. The vehicles must be equipped with the most recent Hardware 3 package and the fully optioned Autopilot package that the company has marketed as “full self-driving.”
The feature, called Traffic Light and Stop Sign Control, is designed to allow the vehicles to recognize and respond to traffic lights and stop signs.
To be clear, Tesla vehicles are not self-driving and this feature has its limits. The feature slows properly equipped Tesla vehicles to a stop when using “traffic-aware cruise control” or “Autosteer.” The vehicle will slow for all detected traffic lights, including green, blinking yellow and off lights, according to the software release notes.
As the vehicle approaches an intersection, a notification will indicate the intention to slow down. The vehicle will then begin to slow down and stop at the red line shown on the driving visualization, which is on the center display.
DragTimes tested and shared a video of a beta version of the feature (posted below).
Owners must pull the Autopilot stalk once or manually press the accelerator pedal to continue through the stop line. Tesla said the feature is designed to be conservative at first. Owners will notice that it will slow down often and will not attempt to turn through intersections. “Over time, as we learn from the fleet, the feature will control more naturally,” the company wrote in the release notes.
Tesla warns in the release notes that “as with all Autopilot features, you must continue to pay attention and be ready to take immediate action, including braking because this feature may not stop for all traffic controls.”
The software update also improved driving visualization, which is displayed in the vehicle. Additional objects such as stop lights, stop signs and select road markings now appear on the screen. The stop sign and stop light visualizations are not a substitute for an attentive driver and will not stop the car, Tesla said in the release notes.
Good morning and welcome back to TechCrunch’s Equity Monday, a jumpstart for your week.
Regular Equity episodes still drop each and every Friday morning, so if you’ve listened to the show over the years, don’t worry — we’re only adding to the mix. You can catch last week’s show with Danny Crichton and Natasha Mascarenhas right here if you haven’t yet.
Unlike some weeks when the weekend’s crop of news and thought runs fallow, our recent interlude was stuffed with things to talk about:
And then, finally, this essay from Founder’s Fund John Luttig, which I encourage you to read. It’s something that everyone is reading, and thus you must even if you don’t want to. We chat about it on the show, but read it yourself anyways. If it’s right, we’re in for a sea change in the startup world. For good, or at least until there’s a new leap forward in tech or technology product distribution. (You can read more on the idea of a SaaS slowdown here.)