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As concerns rise over forest carbon offsets, Pachama’s verified offset marketplace gets $15 million

By Jonathan Shieber

Restoring and preserving the world’s forests has long been considered one of the easiest, lowest cost, and simplest ways to reduce the amount of greenhouse gases in the atmosphere.

It’s by far the most popular method for corporations looking to take an easy first step on the long road to decarbonizing or offsetting their industrial operations. But in recent months the efficacy, validity, and reliability of a number of forest offsets have been called into question thanks to some blockbuster reporting from Bloomberg.

It’s against this uncertain backdrop that investors are coming in to shore up financing for Pachama, a company building a marketplace for forest carbon credits that it says is more transparent and verifiable thanks to its use of satellite imagery and machine learning technologies.

That pitch has brought in $15 million in new financing for the company, which co-founder and chief executive Diego Saez Gil said would be used for product development and the continued expansion of the company’s marketplace.

Launched only one year ago, Pachama has managed to land some impressive customers and backers. No less an authority on things environmental than Jeff Bezos (given how much of a negative impact Amazon operations have on the planet), gave the company a shoutout in his last letter to shareholders as Amazon’s outgoing chief executive. And the largest ecommerce company in Latin America, Mercado Libre, tapped the company to manage an $8 million offset project that’s part of a broader commitment to sustainability by the retailing giant.

Amazon’s Climate Pledge Fund is an investor in the latest round, which was led by Bill Gates’ investment firm Breakthrough Energy Ventures. Other investors included Lowercarbon Capital (the climate-focused fund from über-successful angel investor, Chris Sacca), former Über executive Ryan Graves’ Saltwater, the MCJ Collective, and new backers like Tim O’Reilly’s OATV, Ram Fhiram, Joe gebbia, Marcos Galperin, NBA All-star Manu Ginobilli, James Beshara, Fabrice Grinda, Sahil Lavignia, and Tomi Pierucci.

That’s not even the full list of the company’s backers. What’s made Pachama so successful, and given the company the ability to attract top talent from companies like Google, Facebook, SapceX, Tesla, OpenAI, Microsoft, Impossible Foods and Orbital Insights, is the combination of its climate mission applied to the well-understood forest offset market, said Saez Gil.

“Restoring nature is one of the most important solutions to climate change. Forests, oceans and other ecosystems not only sequester enormous amounts of CO2from the atmosphere, but they also provide critical habitat for biodiversity and are sources of livelihood for communities worldwide. We are building the technology stack required to be able to drive funding to the restoration and conservation of these ecosystems with integrity, transparency and efficiency” said Diego Saez Gil, Co-founder and CEO at Pachama. “We feel honored and excited to have the support of such an incredible group of investors who believe in our mission and are demonstrating their willingness to support our growth for the long term”. 

Customers outside of Latin America are also clamoring for access to Pachama’s offset marketplace. Microsoft, Shopify, and Softbank are also among the company’s paying buyers.

It’s another reason that investors like Y Combinator, Social Capital, Tobi Lutke, Serena Williams, Aglaé Ventures (LVMH’s tech investment arm), Paul Graham, AirAngels, Global Founders, ThirdKind Ventures, Sweet Capital, Xplorer Capital, Scott Belsky, Tim Schumacher, Gustaf Alstromer, Facundo Garreton, and Terrence Rohan, were able to commit to backing the company’s nearly $24 million haul since its 2020 launch. 

“Pachama is working on unlocking the full potential of nature to remove CO2 from the atmosphere,” said Carmichael Roberts from BEV, in a statement. “Their technology-based approach will have an enormous multiplier effect by using machine learning models for forest analysis to validate, monitor and measure impactful carbon neutrality initiatives. We are impressed by the progress that the team has made in a short period of time and look forward to working with them to scale their unique solution globally.” 

 

Tesla sees bitcoin as important financial tool to access cash quickly

By Rebecca Bellan

Tesla’s relationship with bitcoin is not a dalliance, according to the comments made by the company’s CFO and dubbed “master of coin” Zach Kirkhorn during an earnings call Monday. Instead, the company believes in the longevity of bitcoin, despite its volatility.

Tesla invested $1.5 billion in bitcoin this quarter and then trimmed its position by 10%, Kirkhorn said during the company quarterly earnings call. That sale made a $101 million “positive impact” to the company’s profitability in the first quarter, he added. Tesla also allows customers to make vehicle deposits and final vehicle purchases using bitcoin. 

Tesla turned to bitcoin as a place to store cash and still access it immediately, all while providing a better return on investment than more traditional central bank-backed safe havens. Of course, the higher yields provided by the volatile digital currency comes with higher risk.

Tesla bucks the trend of the more cautionary Federal Reserve Chairman Jay Powell who noted back in March at virtual summit hosted by the Bank for International Settlements that the Fed considers crypto speculative assets that are highly volatile and therefore not useful stores of value. That matters because the basic function of currency is its ability to store value. He also noted that digital currencies are not backed by anything and compared it to gold and not the dollar.

From Kirkhorn:

Elon and I were looking for a place to store cash that wasn’t being immediately used, try to get some level of return on this, but also preserve liquidity, you know, particularly as we look forward to the launch of Austin and Berlin and uncertainty that’s happening with semiconductors and port capacity, being able to access our cash very quickly is super important to us right now.

And, you know, there aren’t many traditional opportunities to do this or at least that we found and and talking to others that we could get good feedback on, particularly with yields being so low and without taking on additional risk or sacrificing liquidity. Bitcoin seemed at the time, and so far has proven to be a good decision, a good place to place some of our cash that’s not immediately being used for daily operations or maybe not needed till the end of the year, and be able to get some return on that.

Tesla is watching the digital currency closely, Kirkhorn said, noting that there is a lot of reason to be optimistic.

“You know, thinking about it from a corporate treasury perspective, we’ve been quite pleased with how much liquidity there is in the bitcoin market,” he said. “Our ability to build our first position happened very quickly. When we did the sale later in March we also were able to execute on that very quickly. And so as we think about kind of global liquidity for the business in risk management, being able to get cash in and out of the market is something that I think is exceptionally important for us.”

While Tesla did trim its position in March, Kirkhorn added that the company’s intent is to hold what it has long term and to continue to accumulate bitcoin from transactions from its customers as they purchase vehicles. Musk, who also goes by Technoking, announced in March that Tesla would accept bitcoin as a form of payment in the United States.

Tesla wants to make every home a distributed power plant

By Aria Alamalhodaei

Tesla CEO Elon Musk wants to turn every home into a distributed power plant that would generate, store and even deliver energy back into the electricity grid all using the company’s products.

While the company has been selling solar and energy storage products for years, a new company policy to only sell solar coupled with the energy storage products, along with Musk’s comments Monday, reveal a strategy that aims to scale these businesses by appealing to utilities.

“This is a prosperous future both for Tesla and for the utilities,” he said. “If this is not done, the utilities will fail to serve their customers. They won’t be able to do it,” Musk said during an investor call, noting the rolling blackouts in California last summer and the more recent grid failure in Texas as evidence that grid reliability has become a bigger concern.

Last week, the company changed its website to prevent customers from only buying solar or its Powerwall energy storage product and instead required purchasing a system. Musk later announced the move in a tweet, stating “solar power will feed exclusively to Powerwall” and that “Powerwall will interface only between utility meter and house main breaker panel, enabling super simple install and seamless whole house backup during utility dropouts.”

Musk’s pitch is that the grid would need more power lines, more power plants, and larger substations to fully decarbonization using renewables plus storage. Distributed residential systems — of course using Tesla products — would provide a better path, in Musk’s view. His claim has been backed up by in part by recent studies from the Massachusetts Institute of Technology, which found that the U.S. can reach a zero-carbon grid by more than doubling its transmission capacity, and another from Princeton University showing that the country may need to triple its transmission systems by 2050 to reach net-zero emissions.

Musk is imagining a radically different electricity grid system than the one we have today, which is centrally controlled and run by grid operators, independent organizations such as the California Independent System Operator or the Electric Reliability Council of Texas. It’s a vision that is riddled with bureaucratic and logistical challenges. Utilities and regulatory policy would need to solve how to handle a large influx of so-called ‘distributed energy resources,’ such as solar panels on residential roofs, which may run contrary to utilities’ long-established business models.

It’s important to note that whether renewables-plus-storage will be alone sufficient to decarbonize the energy grid is a contentious question. Many experts believing that the land use demands, storage requirements and intermittency issues of renewables may make their role as the country’s primary electricity generator a pipe dream. But Musk has long been bullish on the renewables-plus-storage model, tweeting last July that “physics favors electric transport, batteries for stationary storage & solar/wind for energy generation.”

Tesla grows 74% in the first quarter, besting expectations as its shares ease after hours

By Alex Wilhelm

Today after the bell, American electric car company Tesla reported its Q1 2021 financial performance. The company lost modest ground on the stock market after its news broke.

For the broader electric vehicle and battery startup market that has pursued many SPAC-led combinations in recent months, the generally positive Tesla trailing results could prove a boon, underscoring continued market demand for their category’s hardware.

Turning to the numbers, in the first three quarters of the year, Tesla generated revenues of $10.389 billion, gross profit of $2.215 billion and net income of $438 million.

Tesla earned adjusted net income of $1.052 billion, leading to diluted, non-GAAP earnings per share of $0.93. The street had expected the company to report $10.29 billion in revenue and adjusted earnings per share of $0.79. Shares of Tesla are off around 1% in after-hours trading, after the company reported its top and bottom-line beat.

Tesla grew sharply compared to its year-ago period, in which the company generated $5.985 billion in top-line revenue, leading to just $68 million worth of net income. Compared to that year-ago period, Tesla’s Q1 2021 saw its revenues expand by 74%, its automotive gross margin improve by just under 1% (95 basis points), its aggregate gross margins better themselves by slightly less (70 basis points), and its net income explode 1,850% while its adjusted net income grew by an also impressive 304%.

In the same four-month period, Tesla’s operating cash flow came to $1.641 billion. The company can comfortably self-fund at that pace of cash generation. That’s underscored by the fact that Tesla closed its first quarter with cash and cash equivalents worth a total of $17.1 billion.

Tracking neatly with its 75% revenue growth was automotive production growth of 76% in the first quarter, with the company producing 180,338 cars, far above its year-ago Q1 tally of 102,672 units. Deliveries of vehicles rose 109%, to 184,877, over the same timeframe.

The company’s solar and energy storage businesses also posted material growth: Solar deployments rose 163% to 92 megawatts, while storage deployment rose 71% to 445 megawatt hours.

Turning to outlook, Tesla told investors in its deck that “over a multiyear horizon, [the company expects] to achieve 50% average annual growth in vehicle deliveries.” The company added that it anticipates Tesla Semi deliveries to commence this year, adding another revenue line to the company’s product mix.

Looking ahead, investors expect Tesla adjusted net income to rise to $0.99 per diluted share this quarter, off of revenues totaling $11.39 billion.

Crusoe Energy is tackling energy use for cryptocurrencies and data centers and greenhouse gas emissions

By Jonathan Shieber

The two founders of Crusoe Energy think they may have a solution to two of the largest problems facing the planet today — the increasing energy footprint of the tech industry and the greenhouse gas emissions associated with the natural gas industry.

Crusoe, which uses excess natural gas from energy operations to power data centers and cryptocurrency mining operations, has just raised $128 million in new financing from some of the top names in the venture capital industry to build out its operations — and the timing couldn’t be better.

Methane emissions are emerging as a new area of focus for researchers and policymakers focused on reducing greenhouse gas emissions and keeping global warming within the 1.5 degree targets set under the Paris Agreement. And those emissions are just what Crusoe Energy is capturing to power its data centers and bitcoin mining operations.

The reason why addressing methane emissions is so critical in the short term is because these greenhouse gases trap more heat than their carbon dioxide counterparts and also dissipate more quickly. So dramatic reductions in methane emissions can do more in the short term to alleviate the global warming pressures that human industry is putting on the environment.

And the biggest source of methane emissions is the oil and gas industry. In the U.S. alone roughly 1.4 billion cubic feet of natural gas is flared daily, said Chase Lochmiller, a co-founder of Crusoe Energy. About two thirds of that is flared in Texas with another 500 million cubic feet flared in North Dakota, where Crusoe has focused its operations to date.

For Lochmiller, a former quant trader at some of the top American financial services institutions, and Cully Cavmess, a third generation oil and gas scion, the ability to capture natural gas and harness it for computing operations is a natural combination of the two men’s interests in financial engineering and environmental preservation.

NEW TOWN, ND – AUGUST 13: View of three oil wells and flaring of natural gas on The Fort Berthold Indian Reservation near New Town, ND on August 13, 2014. About 100 million dollars worth of natural gas burns off per month because a pipeline system isn’t in place yet to capture and safely transport it . The Three Affiliated Tribes on Fort Berthold represent Mandan, Hidatsa and Arikara Nations. It’s also at the epicenter of the fracking and oil boom that has brought oil royalties to a large number of native americans living there. (Photo by Linda Davidson / The Washington Post via Getty Images)

The two Denver natives met in prep-school and remained friends. When Lochmiller left for MIT and Cavness headed off to Middlebury they didn’t know that they’d eventually be launching a business together. But through Lochmiller’s exposure to large scale computing and the financial services industry, and Cavness assumption of the family business they came to the conclusion that there had to be a better way to address the massive waste associated with natural gas.

Conversation around Crusoe Energy began in 2018 when Lochmiller and Cavness went climbing in the Rockies to talk about Lochmiller’s trip to Mt. Everest.

When the two men started building their business, the initial focus was on finding an environmentally friendly way to deal with the energy footprint of bitcoin mining operations. It was this pitch that brought the company to the attention of investors at Polychain, the investment firm started by Olaf Carlson-Wee (and Lochmiller’s former employer), and investors like Bain Capital Ventures and new investor Valor Equity Partners.

(This was also the pitch that Lochmiller made to me to cover the company’s seed round. At the time I was skeptical of the company’s premise and was worried that the business would just be another way to prolong the use of hydrocarbons while propping up a cryptocurrency that had limited actual utility beyond a speculative hedge against governmental collapse. I was wrong on at least one of those assessments.)

“Regarding questions about sustainability, Crusoe has a clear standard of only pursuing projects that are net reducers of emissions. Generally the wells that Crusoe works with are already flaring and would continue to do so in the absence of Crusoe’s solution. The company has turned down numerous projects where they would be a buyer of low cost gas from a traditional pipeline because they explicitly do not want to be net adders of demand and emissions,” wrote a spokesman for Valor Equity in an email. “In addition, mining is increasingly moving to renewables and Crusoe’s approach to stranded energy can enable better economics for stranded or marginalized renewables, ultimately bringing more renewables into the mix. Mining can provide an interruptible base load demand that can be cut back when grid demand increases, so overall the effect to incentivize the addition of more renewable energy sources to the grid.”

Other investors have since piled on including: Lowercarbon Capital, DRW Ventures, Founders Fund, Coinbase Ventures, KCK Group, Upper90, Winklevoss Capital, Zigg Capital and Tesla co-founder JB Straubel.

The company now operate 40 modular data centers powered by otherwise wasted and flared natural gas throughout North Dakota, Montana, Wyoming and Colorado. Next year that number should expand to 100 units as Crusoe enters new markets such as Texas and New Mexico. Since launching in 2018, Crusoe has emerged as a scalable solution to reduce flaring through energy intensive computing such as bitcoin mining, graphical rendering, artificial intelligence model training and even protein folding simulations for COVID-19 therapeutic research.

Crusoe boasts 99.9% combustion efficiency for its methane, and is also bringing additional benefits in the form of new networking buildout at its data center and mining sites. Eventually, this networking capacity could lead to increased connectivity for rural communities surrounding the Crusoe sites.

Currently, 80% of the company’s operations are being used for bitcoin mining, but there’s increasing demand for use in data center operations and some universities, including Lochmiller’s alma mater of MIT are looking at the company’s offerings for their own computing needs.

“That’s very much in an incubated phase right now,” said Lochmiller. “A private alpha where we have a few test customers… we’ll make that available for public use later this year.”

Crusoe Energy Systems should have the lowest data center operating costs in the world, according to Lochmiller and while the company will spend money to support the infrastructure buildout necessary to get the data to customers, those costs are negligible when compared to energy consumption, Lochmiller said.

The same holds true for bitcoin mining, where the company can offer an alternative to coal powered mining operations in China and the construction of new renewable capacity that wouldn’t be used to service the grid. As cryptocurrencies look for a way to blunt criticism about the energy usage involved in their creation and distribution, Crusoe becomes an elegant solution.

Institutional and regulatory tailwinds are also propelling the company forward. Recently New Mexico passed new laws limiting flaring and venting to no more than 2 percent of an operator’s production by April of next year and North Dakota is pushing for incentives to support on-site flare capture systems while Wyoming signed a law creating incentives for flare gas reduction applied to bitcoin mining. The world’s largest financial services firms are also taking a stand against flare gas with BlackRock calling for an end to routine flaring by 2025.

“Where we view our power consumption, we draw a very clear line in our project evaluation stage where we’re reducing emissions for an oil and gas projects,” Lochmiller said. 

Tesla owners can now see how much solar or coal is powering their EVs

By Kirsten Korosec

Tesla owners can now see exactly what kind of energy is powering their electric vehicles. TezLab, a free app that’s like a Fitbit for a Tesla vehicle, pushed out a new feature this week that shows the energy mix — breaking down the exact types and percentages of fossil fuels and renewable energy — coming from charging locations, including Superchargers and third-party networks throughout the United States.

“We’re tracking the origin of data as it relates to energy, so we know if you’re in Tucson or Brooklyn (or any location) where the energy is coming from and what the mix of that energy looks like,” Ben Schippers, the CEO and co-founder of TezLab explained in a recent interview. “As a result, we can see how much carbon is being pushed out into the atmosphere based on your charge, whether you’re charging at home, or whether you’re charging at a Supercharger.”

ElectricityMap, a project from Tomorrow, provided the energy data, which TezLab then folded into its consumer-facing app. Once downloaded, the app knows when and where a Tesla owner is plugging in. The energy mix feature builds off of an existing program on the app that gave owners more general information on how dirty or clean their charge is.

Image Credits: TezLab

Take Tesla’s Linq High Roller Supercharger in Las Vegas, a V3 Supercharger that is supposed to support a peak rate of up to 250 kilowatts and has been heralded for its use of Tesla solar panels and its Powerpack batteries to generate and store the power needed to operate the chargers.

According to TezLab’s data, 1.7% of the energy is from solar. The primary source of renewable energy is actually hydro at 65.6% — courtesy of the Hoover Dam. The remaining energy mix from the Supercharger is about 33% natural gas.

Tesla’s Supercharger in Hawthorne, California, which was one of the first to have solar panels, has an energy mix of 0.2% solar, 5.5% nuclear,13.3% natural gas, 27% coal and 49.9% wind.

The top 10 “cleanest” Superchargers — a list that includes Centralia, Leavenworth, Moses Lake and Seattle, Washington — achieved that goal thanks to hydroelectric power. Superchargers with the most solar energy are all located in the same power grid in California. Superchargers in Barstow, Oxnard, Cabazon, San Diego, Mojave, Inyokern, San Mateo, Seaside and Santa Ana, California all have 22.7% solar and 15% wind energy. The remaining mix at these locations is 0.2% battery storage, 2.9% biomass, 5.6% geothermal, 6.3% hydro, 6.6% nuclear and 40% natural gas.

TezLab was born out of HappyFunCorp, a software engineering shop that builds apps for mobile, web, wearables and Internet of Things devices for clients that include Amazon, Facebook and Twitter, as well as an array of startups. HFC’s engineers, including co-founders Schippers (who is now chairman of the company’s board) and William Schenk, were attracted to Tesla largely because of its software-driven approach. The group was particularly intrigued at the opportunity created by the openness of the Tesla API. The Tesla API is technically private. But the endpoints are accessible to outsiders. When reverse-engineered, it’s possible for a third-party app to communicate directly with the API.

TezLab launched in 2018 with some initial features that let owners track their efficiency, total trip miles and use it to control certain functions of the vehicle, such as locking and unlocking the doors and heating and air conditioning. More features have been added, mostly focused on building community, including one that allows Tesla owners to rate Supercharger stations.

All of that data is aggregated and anonymous. TezLab has said it won’t sell that data. It does post on its website insights gleaned from that data, such as a breakdown of model ownership, the average trip length and average time between plugging in.

As other electric vehicles come to market, TezLab is adding those to the app, including the Ford Mustang Mach-E.

Ford takes aim at Tesla, GM with its new hands-free driving system

By Kirsten Korosec

Ford will debut its new hands-free driving feature on the 2021 F-150 pickup truck and certain 2021 Mustang Mach-E models through a software update later this year, technology that the automaker developed to rival similar systems from Tesla and GM.

That hands-free capability — which uses camera, radar sensors and software to provide a combination of adaptive cruise control, lane centering and speed sign recognition — has undergone some 500,000 miles of development testing, Ford emphasized in its announcement and tweet from its CEO Jim Farley in a not-so-subtle dig at Tesla’s approach of rolling out beta software to customers. The system also has an in-cabin camera that monitors eye gaze and head position to help ensure the driver’s eyes remain on the road.

The hands-free system will be available on vehicles equipped with Ford’s Co-Pilot360 Technology and will only work on certain sections of divided highways that Ford. The system, which will be rolled out via software updates later this year, will initially be available on more than 100,000 miles of highways in North America.

BlueCruise! We tested it in the real world, so our customers don’t have to. pic.twitter.com/dgqVkWH31r

— Jim Farley (@jimfarley98) April 14, 2021

The system does comes with a price. BlueCruise software, which includes a three-year service period, will cost $600. The price of upgrading the hardware will depend on the vehicle. For instance, on F-150 owners will have to plunk down another $995 for the hardware, while owners of the “select” Mustang Mach-E model variant will have to pay an additional $2,600. BlueCruise comes standard on CA Route 1, Premium and First Edition variants of the Mustang Mach-E.

While nearly every automaker offers some driver assistance features, Ford is clearly aiming to compete with or capture market share away from GM and Tesla — the two companies with the best-known and capable ADAS. Convincing customers that its system is worth the expense will be critical to meeting its internal target of selling more than 100,000 vehicles equipped with BlueCruise in the first year, based on company sales and take-rate projections.

GM 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.

Tesla’s Autopilot feature also combines sensors like cameras and radar, computing power and software. Autopilot, which comes standard in all new Tesla vehicles, will steer, accelerate and brake automatically within its lane. Tesla uses a torque sensor in the steering wheel to determine if drivers are paying attention, although many owners have found and publicly documented hacks so they can keep their hands off the wheels and eyes off the road ahead. Tesla charges $10,000 for its upgrade to FSD (its own internal branding meant to stand for full self-driving). FSD is not an autonomous system. It does provide a number of more capable driver assist functions including automatic lane changes, the ability to recognize and act upon traffic lights and stop signs and a navigation feature that will suggest lane changes on route and automatically steer the vehicle toward highway interchanges and exits.

Ford said that its system communicates with drivers in different ways, including displaying text and blue lighting cues in the instrument cluster, which it says is effective even for those with color blindness.

The so-called BlueCruise hands-free technology will be offered in other Ford vehicle models in the future, the company said. Drivers who opt for the technology will continue to receive software updates as it is improved. Ford said future improvements will include a feature that will let the vehicle change lanes by tapping the turn signal indicator as well as one that will predict and then adjust vehicle speed for roundabouts and curves. The company also said it plans to offer regular mapping updates.

China’s Xpeng in the race to automate EVs with lidar

By Rita Liao

Elon Musk famously said any company relying on lidar is “doomed.” Tesla instead believes automated driving functions are built on visual recognition and is even working to remove the radar. China’s Xpeng begs to differ.

Founded in 2014, Xpeng is one of China’s most celebrated electric vehicle startups and went public when it was just six years old. Like Tesla, Xpeng sees automation as an integral part of its strategy; unlike the American giant, Xpeng uses a combination of radar, cameras, high-precision maps powered by Alibaba, localization systems developed in-house, and most recently, lidar to detect and predict road conditions.

“Lidar will provide the 3D drivable space and precise depth estimation to small moving obstacles even like kids and pets, and obviously, other pedestrians and the motorbikes which are a nightmare for anybody who’s working on driving,” Xinzhou Wu, who oversees Xpeng’s autonomous driving R&D center, said in an interview with TechCrunch.

“On top of that, we have the usual radar which gives you location and speed. Then you have the camera which has very rich, basic semantic information.”

Xpeng is adding lidar to its mass-produced EV model P5, which will begin delivering in the second half of this year. The car, a family sedan, will later be able to drive from point A to B based on a navigation route set by the driver on highways and certain urban roads in China that are covered by Alibaba’s maps. An older model without lidar already enables assisted driving on highways.

The system, called Navigation Guided Pilot, is benchmarked against Tesla’s Navigate On Autopilot, said Wu. It can, for example, automatically change lanes, enter or exit ramps, overtake other vehicles, and maneuver another car’s sudden cut-in, a common sight in China’s complex road conditions.

“The city is super hard compared to the highway but with lidar and precise perception capability, we will have essentially three layers of redundancy for sensing,” said Wu.

By definition, NGP is an advanced driver-assistance system (ADAS) as drivers still need to keep their hands on the wheel and take control at any time (Chinese laws don’t allow drivers to be hands-off on the road). The carmaker’s ambition is to remove the driver, that is, reach Level 4 autonomy two to four years from now, but real-life implementation will hinge on regulations, said Wu.

“But I’m not worried about that too much. I understand the Chinese government is actually the most flexible in terms of technology regulation.”

The lidar camp

Musk’s disdain for lidar stems from the high costs of the remote sensing method that uses lasers. In the early days, a lidar unit spinning on top of a robotaxi could cost as much as $100,000, said Wu.

“Right now, [the cost] is at least two orders low,” said Wu. After 13 years with Qualcomm in the U.S., Wu joined Xpeng in late 2018 to work on automating the company’s electric cars. He currently leads a core autonomous driving R&D team of 500 staff and said the force will double in headcount by the end of this year.

“Our next vehicle is targeting the economy class. I would say it’s mid-range in terms of price,” he said, referring to the firm’s new lidar-powered sedan.

The lidar sensors powering Xpeng come from Livox, a firm touting more affordable lidar and an affiliate of DJI, the Shenzhen-based drone giant. Xpeng’s headquarters is in the adjacent city of Guangzhou about 1.5 hours’ drive away.

Xpeng isn’t the only one embracing lidar. Nio, a Chinese rival to Xpeng targeting a more premium market, unveiled a lidar-powered car in January but the model won’t start production until 2022. Arcfox, a new EV brand of Chinese state-owned carmaker BAIC, recently said it would be launching an electric car equipped with Huawei’s lidar.

Musk recently hinted that Tesla may remove radar from production outright as it inches closer to pure vision based on camera and machine learning. The billionaire founder isn’t particularly a fan of Xpeng, which he alleged owned a copy of Tesla’s old source code.

In 2019, Tesla filed a lawsuit against Cao Guangzhi alleging that the former Tesla engineer stole trade secrets and brought them to Xpeng. XPeng has repeatedly denied any wrongdoing. Cao no longer works at Xpeng.

Supply challenges

While Livox claims to be an independent entity “incubated” by DJI, a source told TechCrunch previously that it is just a “team within DJI” positioned as a separate company. The intention to distance from DJI comes as no one’s surprise as the drone maker is on the U.S. government’s Entity List, which has cut key suppliers off from a multitude of Chinese tech firms including Huawei.

Other critical parts that Xpeng uses include NVIDIA’s Xavier system-on-the-chip computing platform and Bosch’s iBooster brake system. Globally, the ongoing semiconductor shortage is pushing auto executives to ponder over future scenarios where self-driving cars become even more dependent on chips.

Xpeng is well aware of supply chain risks. “Basically, safety is very important,” said Wu. “It’s more than the tension between countries around the world right now. Covid-19 is also creating a lot of issues for some of the suppliers, so having redundancy in the suppliers is some strategy we are looking very closely at.”

Taking on robotaxis

Xpeng could have easily tapped the flurry of autonomous driving solution providers in China, including Pony.ai and WeRide in its backyard Guangzhou. Instead, Xpeng becomes their competitor, working on automation in-house and pledges to outrival the artificial intelligence startups.

“The availability of massive computing for cars at affordable costs and the fast dropping price of lidar is making the two camps really the same,” Wu said of the dynamics between EV makers and robotaxi startups.

“[The robotaxi companies] have to work very hard to find a path to a mass-production vehicle. If they don’t do that, two years from now, they will find the technology is already available in mass production and their value become will become much less than today’s,” he added.

“We know how to mass-produce a technology up to the safety requirement and the quarantine required of the auto industry. This is a super high bar for anybody wanting to survive.”

Xpeng has no plans of going visual-only. Options of automotive technologies like lidar are becoming cheaper and more abundant, so “why do we have to bind our hands right now and say camera only?” Wu asked.

“We have a lot of respect for Elon and his company. We wish them all the best. But we will, as Xiaopeng [founder of Xpeng] said in one of his famous speeches, compete in China and hopefully in the rest of the world as well with different technologies.”

5G, coupled with cloud computing and cabin intelligence, will accelerate Xpeng’s path to achieve full automation, though Wu couldn’t share much detail on how 5G is used. When unmanned driving is viable, Xpeng will explore “a lot of exciting features” that go into a car when the driver’s hands are freed. Xpeng’s electric SUV is already available in Norway, and the company is looking to further expand globally.

The 2022 Mercedes-Benz EQS stakes its claim on a luxury, electric future

By Tamara Warren

A day spent driving a pre-production 2022 Mercedes Benz EQS provided an up-close look at what the German automaker has been doing with the billions of dollars it has dedicated to electrification.

The EQS is a meticulously designed flagship sedan that brings together the automaker’s MBUX infotainment system, a new electric platform and advancements in performance. It is an unapologetic pursuit to set a new benchmark for a full-size luxury sedan that happens to be electric.

The luxury electric sedan is meant to show American consumers what Mercedes can deliver (and will) in the future with EVs. And the stakes are high. The German automaker is banking on a successful rollout of the EQS in North America.

Mercedes-Benz-EQS

Image Credits: Mercedes-Benz

“It’s the beginning of a complete new era, because so far we had a completely flexible platform in place with hybrids, ICE, and BEVs,” said Christophe Starzynski, head of the EQ brand, who added that Mercedes will add three additional electric vehicles to its U.S. portfolio by 2025, including the EQE and two additional SUVs. “This is the first time that we really designed and developed and put all the technology in a battery electric vehicle.”

The EQS is the 17-foot long flagship derivative of the S-Class, Mercedes-Benz’s top-of-the-line luxury sedan that has a base price of $110,000. (So far, pricing on EQS hasn’t been revealed.) It’s stocked with its best tech to date. While most customers won’t appreciate all the doodads optioned on this car, they might enjoy knowing it’s all stored in that extensive infotainment cloud, or only a software update away.

The first drive

A fully loaded EQS is such a leap forward that it makes the new S Class already feel of another era.

The EQS 580 4Matic model I tested came spec’d out with the 56-inch Hyperscreen, head up display, acoustic glass, rear seat entertainment and an air filtration system, which Starzynski said pre-dates the pandemic, but naturally feels very of the moment.

At writing, the car’s exterior details are under wraps until its reveal April 15. The version I tested was partially cloaked, so I can’t tell you much about the sculpted nuances of its A pillar.

Mercedes-Benz-EQS

Image Credits: Mercedes-Benz

My five-year-old daughter accompanied me on the test drive. We started at the Mercedes Manhattan dealership, where EQS was displayed in the store window. As I approached the car, the driver door automatically swung open with great fanfare. From the vantage point of her booster seat, my daughter played with the rear screen that hovered in front of her. She selected ambient lighting in pink and purple hues for the cabin. Her top takeaway: “It’s a sparkly rainbow ride.”

The backseat experience actually matters quite a bit, because EQS is chauffeur friendly, a prereq for luxury cars in China, the hub for EV sales for the next decade.

Mercedes EQS

Image Credits: Mercedes-Benz

Meanwhile, up front, for a tall person like myself, the spacious driver seat — accented by the pillow that cradled the base of my neck — was one the most comfortable rides I’ve had. Once belted in, the car is all mood. Cue the lighting and sound design bells and whistles.

As much as I could appreciate the sensation of sonic silver waves to compensate for that faint EV whir, we soon opted to blast the five year old’s current favorite Barbie soundtrack from the billowing set of 15 Burmester speakers. (There are unfortunate compromises involved in bringing a five year old along for the ride.)

Everything in the EQS emanates from the 56-inch Hyperscreen OLED, which is divided into three separate displays spanning door-to-door. In person, it’s not as intrusive as it appears in photos. Its elliptical contour has a gamer-like cockpit sensibility.

The MBUX functions are housed on the main 17.7-inch OLED screen, to the right of the steering wheel. The passenger can opt to personalize their own touchscreen, too. Inside the powerful computation system is 24-gigabytes of RAM and 46.4 GB per second RAM memory, and eight CPU cores.

Mercedes EQS

Image Credits: Mercedes-Benz

The user experience

Simplicity is a hallmark of good design, embodied in the best of Apple products. In contrast, Mercedes has always been big on delivering a dizzying set of user experience options and providing multiple approaches to access information. That inclination carries over in the EQS, using controls on the steering wheel, arm rest, and main screen. On test drives, I find multiple options for controls distracting. I am never sure if it’s because I haven’t had the time to fully adapt, in the same way that a new feature on a smartphone takes a couple weeks to get used to, or if it’s plain overkill. I noted the heads up display, but it was one place too many to look during the time I spent in the car.

Mercedes-Benz-EQS

Image Credits: Mercedes-Benz

What intrigued me is that the MBUX system studies driver behavior over time. By the end of my ride, the screen module reminded me that perhaps I would like to tee up my active seat massage once more. In short, I could bypass the other controls and focus on what I wanted to use most. Voice commands were decent, though my high pitch tenor managed to stump the system. I have yet to meet an automotive voice system that understands me all the time.

There’s no room for analog in the EQS experience. The graphics are crisp, multidimensional-dimensional, and clear. One downside was that my fingerprints smudged on the touchscreens. Pro tip: bring along a good screen spritzer and cloth before shooting photos. Another small grip was that the steering wheel seemed to be designed for a person with much larger hands than mine, and it was a little awkward to access all the functions stored on the wheel, which forced me to glance down to find the right spots. I ended up relying on the MBUX center screen to adjust settings.

My favorite part of the EQS user experience is how it handled messaging about range. At all times, the various screens on the dash displayed how many miles I had left, if my calculations for my destination were realistic, and mapped where I could go to charge.

The range

About that battery. The model I drove had a 107.8 kWh battery pack powering two electric motors used in the all-wheel-drive system. The range according to European testing is 470 miles, but could drop down according to U.S. EPA testing standards. I drove about 125 miles roundtrip from Manhattan to a little town called Beacon and back without even worrying about recharging.

Mercedes EQS

Image Credits: Mercedes Benz

I pulled up the screen to plot out ChargePoint options presented one click away. It also distinguishes which stations have 200 kW DC fast-chargers available, which Mercedes says take about 15 minutes to recharge. To assuage consumers on battery life, Mercedes has added a warranty that covers loss of capacity of the battery, valid for a decade after purchase, or up 150,000 miles.

The takeaway

The drive itself delivered powerful performance, as one would expect with 517 hp and 406 lb-ft of torque at work. The EQS beats out competitors drag coefficient at .20, which is a fun car enthusiast fact, but not essential knowledge for regular drivers.

It always takes a moment to get comfortable driving a long saloon, but like the S Class, the EQS handles its proportions with grace, and it turns with ease due to standard rear-wheel steering. It mirrors the S-Class safety features and ADAS systems. The drive settings include classic and sport, achievable through steering wheel controls or through the armrest. I am generally a sporty driver, and I liked the peppy feedback that this mode delivered.

“Of course we will be developing it further,” Starzysnki said, adding that the ADAS features will improve via software updates. Customizable updates such as light settings are also available for download.

The biggest differentiator of the EQS drive is its battery recuperation system. Intelligent recuperation mode optimizes the battery and controls driver actions. Normal recuperation dialed down the interference. I played around with one-pedal driving on the highway. Drivers can also choose no support at all.

Mercedes-Benz-EQS

Image Credits: Mercedes-Benz

Mainstream EV adoption in the United States feels like its right around the corner — and it could come even faster than expected if President Biden’s infrastructure plan passes. But automakers will need to do much more than edge out Tesla if they hope to capture the attention and dollars of U.S. consumers. EVs accounted for just 1.8% of U.S. car sales in 2020, according to Experian and reported in Automotive News.

Sweeping change takes time, money and a long-term commitment. The next level Mercedes-Benz EQS edges the playing field one step closer to the tipping point when the EV part of the architecture is no longer newsworthy, but the expectation for a luxury vehicle.

(Disclosure: In 2018, I was a Mercedes-Benz EQ fellow for the Summit Series program, which was sponsored by the automaker, and I was featured on the EQ homepage.)

The 2022 Chevrolet Bolt EUV lowers the cost of entry for some of GM’s most advanced tech

By Abigail Bassett

The 2022 Chevy Bolt EUV may look like a larger, slightly longer Chevrolet Bolt, but under that boxy exterior lies a whole lot of tech that’s both affordable and very advanced. With the launch of the Chevy Bolt EUV, and its available suite of advanced driver assistance systems, GM is putting both advanced driver assistance technology and electric drivetrains within reach of the masses.

As part of GMs much-touted goal to introduce 30 new electric vehicles in the next four years, the company recently launched an updated Bolt, as well as the all-new Bolt EUV, or Electric Utility Vehicle. I had two separate opportunities to test prototypes of the Bolt EUV with GM’s advanced Super Cruise system.

While the Bolt and Bolt EUV share similar DNA, they are two different vehicles. The EUV is the longer and larger of the two, with more bells and whistles, like Super Cruise: An advanced driver assistance system that allows for hands-free driving on certain highways, available as a $2,200 option. Super Cruise is not available on the 2022 Bolt.

Nuts and bolts

The Bolt EUV is powered by a 288-cell, 65-kWh battery pack that Chevy says makes 200 hp and 266 lb-ft of torque. Chevrolet estimates that the EUV will get 250 miles on a full charge, and when charging on the go, can regain up to 95 miles of range in 30 minutes on a Level 2 charger.

On household power, (specifically 240V) the EUV will take around 7-8 hours to charge up to 100%, which is how Chevy says it expects most consumers will power their crossover. To assist with that, Chevrolet had teamed up with home charging installer Qmerit to offer free charger installation if you buy or lease a new Bolt or EUV. Installation of a home charger can cost as much as $2,000, so it’s a decent incentive.

The Bolt EUV won’t get the upgraded Ultium battery pack and underlying architecture that’s coming on the Hummer EV, Cadillac Lyric and other future GM electric vehicles. Instead, the Bolt EUV is built on the BEV2 architecture, the same one on which the 2021 Bolt is built. As mentioned, it also gets Super Cruise as an optional add-on.

Since Super Cruise’s introduction in 2017, the system has been siloed in Cadillac products, showing up on the 2018 CT6 and finally expanding to the 2021 CT5. The Bolt EUV is the first production vehicle outside of a luxury GM brand to offer the system even as paid upgrade.

The Bolt EUV starts at $33,995, which is $2,500 less than the 2021 Bolt that is sitting on dealer lots today. The 2022 Chevy Bolt ($31,995) is also around $4,500 cheaper than the 2021 Bolt. Chevy’s press department says that the goal is to “make EVs attainable to everyone.” Although this is also likely an effort to bring the new vehicles in line with earlier Bolt models that qualified for the $7,500 federal tax credit. That incentive in the U.S. disappeared after GM sold 200,000 EVs nationwide.

The Launch Edition, which included the optional Super Cruise, a lighted charging port and special badging, carried a sticker price of $43,495. As of this writing, reservations for the Launch Edition are completely full, but you can still reserve an LT or Premier trim in the 2022 Bolt EUV. Super Cruise, however, is only available as a $2,200 option on the Premier trim, which starts at $38,495. Keep in mind, these prices are all before including any state or local tax incentives or rebates for electric vehicles.

In contrast, a Tesla Model Y Long Range model, the most affordable of the bunch since Tesla dropped that vehicle’s base option, starts at $41,990 before incentives. Getting Tesla’s so called Full-Self Driving feature — which is not self-driving and is actually a driver assistance system — will cost you an additional $10,000.

User experience: Super Cruise

Super Cruise, while impressive, tends to err on the side of caution when it comes to implementing the technology. The system allows for drivers to take their hands and feet off the controls on more than 200,000 miles of mapped divided highway all over the country.

“If we can bring congestion and crashes to zero, then developing fully-autonomous driving is worth it,” Jeremy Short, the vehicle chief engineer who is responsible for the engineering, development, validation, testing and manufacturing of the Bolt EUV, said during my second time with the crossover. “The next 10 years are going to get really interesting in the autonomy space. Five years ago, would you have thought we would have what we have now with Super Cruise?”

That being said, Super Cruise isn’t perfect, and GM continues to iterate the product, even on the Bolt EUV. During my first drive in a Bolt EUV prototype from Marina Del Rey to Burbank and back in peak Los Angeles rush hour traffic, Super Cruise seemed a little bit “off.” The system ping-ponged in the wide lanes on the highway. When the vehicle was moving under 30 mph, the system lost track of the lane markings on mapped highways like the extremely busy 405, causing it to drift toward the other lanes and switch off a number of times.

2022 Chevrolet Bolt EUV

2022 Chevrolet Bolt EUV. Image Credits: GM

A few weeks later, on a second prototype drive that followed a 50-mile loop originating in Carson, the system appeared to have gained its sea legs. However, both Short, who was following in another prototype vehicle, and I noted that Super Cruise in the EUV still had problems when traffic slowed below 10 mph. When cars ahead slowed, the EUV would slow appropriately, but then begin to drift across the lane once traffic moved forward, as if it had lost the lane markings. Eventually, the alert to take over would sound and Super Cruise would shut off.

“I did notice some ping-ponging at low speeds,” Short said after our drive. He then joked that it will require some more engineers driving that stretch of road to teach the system to navigate it without bouncing around the lane. He also said that speed and California’s strange concrete roadbeds (they have textured surfaces that can look like lane markings to AI) can affect Super Cruise. “Think of it like tracer fire; the more data you have coming in, the more accurate the car can be.”

Short says that the Super Cruise system is continually learning and updating — even if it’s fully baked on vehicles like the CT5 and CT6. Every time Super Cruise is added to a new vehicle, the sensors, software and processing needs to be updated and tweaked because each car has different weights, potential speeds, dimensions, steering and braking, space for sensors and features. For example, you will be able to get a version of Super Cruise on the 2022 Cadillac Escalade which includes automatic lane changing features. The 2022 Bolt EUV, however, doesn’t get those sensors and therefore can’t automatically change lanes.

“Each vehicle that has Super Cruise implemented has different anatomy so it needs to process and do different things,” Short said. “The Super Cruise on the Bolt EUV was developed at the same time that engineers were developing it on the Escalade. There’s very different steering and braking in each car so the two systems are different.”

Super Cruise qualifies as an advanced Level 2 autonomous vehicle. As the driver, you still have to remain alert, and attentive, but you can remove your hands from the steering wheel and your feet from the pedals on roads where Super Cruise is available. Sensors embedded in the steering wheel track your eyes (even at night or when you’re wearing dark sunglasses) to ensure that you are paying attention to the road ahead and not watching a movie, napping or glancing at your phone. The system doesn’t give you much leeway to take your eyes off the road while using Super Cruise, either. At 65 mph, you can reach over and change the radio station on the 10.2-inch infotainment screen but alarms will sound if you look away for more than just a few seconds.

“If you were on a long drive from Los Angeles to Las Vegas,” Short explained after I asked about it, “you’d essentially be a front passenger. Both you and your passenger would be looking down the road, keeping your eyes up for any potential issues. When I did that trip with a friend and used Super Cruise, I felt the same level of fatigue that he did, which is to say, not much.”

The other bells and whistles

We haven’t had the typical full week to test the 2022 Bolt EUV to fully evaluate. However, there was enough time to evaluate some of the vehicle’s features.

Chevy’s new onboard infotainment and navigation system runs on the company’s Infotainment 3 software. The system’s voice control, which has natural language processing, allowed me to do a quick search to find local charging stations.

The drawback? The system brought up a number of charging stations, but didn’t indicate which ones were available, in service, out of service, or if they were part of the EvGo system, the charging company that GM has partnered with. Driver’s also can’t page through results while using Super Cruise because the driver monitoring system will notice that their eyes aren’t on the road ahead.

In order to find EvGo chargers, owners need to use the myChevrolet App to locate the chargers and then send the directions to the navigation system. While driving, the system does lock out some features, and Short notes that you won’t be able to flip through pages of apps.

It will be interesting to see how this plays out once we get more time in the EUV. That being said, it’s not likely to be as seamless as the Tesla charging experience.

At its core, the 2022 Chevrolet Bolt EUV offers some of the most advanced driver assistance technology on the market in an EV package for an attainable price. After spending two separate four-hour stints in prototype versions of the EUV, it’s clear that this compact SUV has the space, power and high-tech capability that will allow it to go head-to-head with the likes of the Tesla Model Y, Volvo’s XC40 Recharge, Ford’s Mach-E and Volkswagen’s ID.4.

Andium is watching oil fields for emissions and just got money from the biggest oil companies to do it

By Jonathan Shieber

Andium, a company focused on remote field monitoring of assets including oil and gas wells has just raised some not-insignificant cash in an investment round led by OGCI Climate Investments, a firm formed by the largest oil companies in the world.

Launched in 2014 to “support” the targets laid out in the Paris Agreement to limit global greenhouse gas emissions, OGCI has invested in 21 projects to date.

With Andium, the oil majors join existing investors including Tom Miglis, the former chief investment officer of Citadel Securities and Talis Capital in backing a company developing technologies for natural gas flare monitoring, tank telemetry and object detection.

The company said it provides oil and gas companies with real-time information from remote locations at a far lower cost than other solutions.

Few technologies are less exciting than sensors and monitoring equipment, but there are also few tech services that are more vital to staunching the flow of greenhouse gas emissions. As Mark Tomasovic, a partner at the renewable investment firm, Energize tweeted (to me), “A few companies are involved in monitoring and reducing methane emissions from producing oil and gas wells… Given that there are over [1 million] wells in the U.S. and methane is 28x more potent than CO2, these startups have had more of an impact on global climate change then Tesla.”

A few companies are involved in monitoring and reducing methane emissions from producing oil & gas wells

Given that there are over 1M wells in the U.S. and methane is 28x more potent than CO2, these startups have had more of an impact on global climate change than Tesla

— Mark Tomasovic (@MarkTomasovic) April 6, 2021

“We believe that visibility is paramount in change leadership and operational excellence, and our remote monitoring technologies are specifically designed to offer companies an expedited path to achieve their sustainability goals,” said Jory Schwach, the chief executive of Andium, in a statement.

Schwach, a serial entrepreneur whose previous forays into the business world included GlobalRim, a solar global positioning system company, and an offline communications service, started out developing a battery-powered tracking system for the logistics industry.

“I spent the better part of two years building a battery-powered tracking solution for long haul trailers so the market could replace brokers with ‘shared assets’. I failed fast and often on the hardware and realized that the real value was in the continually changing product requests that would be much more easily solved with a software change,” Schwach told the Medium publication Authority Magazine. “I decided that building a new kind of operating system for small devices could be big business if I leveraged the OS to customize products based on changing use cases while managing the hardware and infrastructure on behalf of the client.”

Andium’s technology uses off the shelf cameras and microphones with an artificial intelligence overlay to provide real-time monitoring of all sorts of industrial assets.

“The transparency created by monitoring and measuring methane is essential to reducing emissions,” said Pratima Rangarajan, CEO of OGCI Climate Investments.  “Andium’s low-cost innovative solution lowers the barrier for operators of all sizes to adopt and implement best practices and we are pleased to support their growth.”

Giving EV batteries a second life for sustainability and profit

By Aria Alamalhodaei

Electric cars and trucks seem to have everything going for them: They don’t produce tailpipe emissions, they’re quieter than their fossil-fuel-powered counterparts and the underlying architecture allows for roomier and often sleeker designs. But the humble lithium-ion battery powering these cars and trucks leads a difficult life. Irregular charging and discharge rates, intense temperatures and many partial charge cycles cause these batteries to degrade in the first five to eight years of use, and eventually, they end up in a recycling facility.

Instead of sending batteries straight to recycling for raw material recovery — and leaving unrealized value on the table — startups and automakers are finding ways to reuse batteries as part of a small and growing market.

Low consumer uptake and the relatively recent introduction of EVs to the market has kept the supply of used batteries low, but automakers are already pursuing a number of second-life projects.

That’s because the average electric vehicle lithium-ion battery can retain up to 70% of its charging capacity after being removed. The business proposition for second-life batteries is therefore intuitive: Before sending the battery to a recycler, automakers can potentially generate additional revenue by putting it to use in another application or selling it to a third party.

Low consumer uptake and the relatively recent introduction of EVs to the market has kept the supply of used batteries low, but automakers are already pursuing a number of second-life projects.

To name only a few such projects that have popped up in recent years, Nissan is using old batteries to power small robots; French carmaker Groupe Renault, with partners, is launching stationary energy storage systems made with old EV batteries; and Audi Environmental Foundation, the daughter organization of Audi AG, worked with Indian startup Nunam to build solar nanogrids out of used e-tron battery modules.

Other OEMs, like Lucid Motors, BMW and Proterra, are incorporating reuse principles into their battery design. In fact, Lucid has built its batteries to work across its electric vehicle and energy storage products, including in second-life uses, Chief Engineer Eric Bach told TechCrunch. And BMW has used a “plug-and-play” concept with the batteries in its i3 model so that they can be easily removed and inserted into second-life applications, BMW spokesperson Weiland Bruch said in an interview with TechCrunch. “We believe that battery second-life will become its own self-standing business field,” he added.

A new lease on battery life

Automakers are increasingly bullish on second-life uses, though the size of their role in this budding market is still unclear. Matthew Lumsden, CEO of U.K.-based Connected Energy, told TechCrunch that he has noticed a shift in the past two years where some OEMs have begun viewing batteries as an asset rather than a liability.

Tim Cook drops hints about autonomous tech and the Apple car

By Rebecca Bellan

Apple CEO Tim Cook dropped a few hints in an interview released Monday about the direction of the much-anticipated Apple car, including that autonomous vehicle technology will likely be a key feature.

“The autonomy itself is a core technology, in my view,” Cook told Kara Swisher in an interview on the “Sway” podcast. “If you sort of step back, the car, in a lot of ways, is a robot. An autonomous car is a robot. And so there’s lots of things you can do with autonomy. And we’ll see what Apple does.”

Cook was careful not to reveal too much, declining to answer Swisher’s question outright if Apple is planning to produce a car itself or the tech within the car. What clues he did drop, suggests Project Titan is working on something in the middle.

“We love to integrate hardware, software and services, and find the intersection points of those because we think that’s where the magic occurs,” said Cook. “And we love to own the primary technology that’s around that.”

To which Swisher responded: “I’m going to go with car for that, if you don’t mind. I’m just going to jump to car.”

We are, too.

Many people in the micromobility industry like to say that e-scooters are basically iPhones on wheels, but it’s more likely that the Apple car will actually be the iPhone on wheels. Apple is generally known for owning all of its hardware and software, so it wouldn’t be surprising to see Apple engineers working closely with a manufacturer to produce an Apple car, with the potential to one day cut out the middle man and become the manufacturer.

The so-called Project Titan appeared at risk of failing before a car was ever seen by the public with mass layoffs in 2019. However, more recent reports suggest that the project is alive and well with plans to make a self-driving electric passenger vehicle by 2024.

Earlier this year, CNBC reported that Apple was close to finalizing a deal with Hyundai-Kia to build an Apple-branded self-driving car at the Kia assembly plant in West Point, Georgia. Sources familiar with Apple’s interest in Hyundai say the company wants to work with an automaker that will let Apple hold the reins on the software and hardware that will go into the car.

The two companies never reached a deal and talks fell apart in February, according to multiple reports. That hasn’t stopped the flow of rumors and reports about Apple and its plans, which have previously been linked to other suppliers, automakers such as Nissan and even startups.

It’s still unclear what the Apple car will look like, but as a passenger vehicle, rather than a robotaxi or delivery vehicle, it will be going up against the likes of Tesla.

“I’ve never spoken to Elon, although I have great admiration and respect for the company he’s built,” said Cook. “I think Tesla has done an unbelievable job of not only establishing the lead, but keeping the lead for such a long period of time in the EV space. So I have great appreciation for them.”

Project Titan is being led by Doug Field, who was formerly senior vice president of engineering at Tesla and one of the key players behind the Model 3 launch.

EV makers oppose delay to automotive emissions penalty increase

By Aria Alamalhodaei

Electric vehicle manufacturers are pushing back against a decision to delay penalty increases for automakers who fail to meet fuel efficiency standards.

A lobbying group representing legacy automakers – many of whom are now making substantial investments in zero-emissions vehicles – said the increase would have a significant economic impact during a time when the industry is facing mass disruption from the COVID pandemic. But new EV entrants say the penalty mechanism is a powerful performance incentive to decrease tailpipe emissions and encourage investment in lower- or zero-emissions technology.  

The decision, issued in January by the National Highway Traffic Safety Administration (NHTSA), postpones imposing a penalty increase from the beginning of model year 2019 to model year 2022. Tesla is petitioning the Second Circuit U.S. Court of Appeals to review the ruling, saying that the delay “inflicts ongoing, irreparable injury” on the company and creates an “uneven playing field” by reducing the consequences of non-adherence.

The Corporate Average Fuel Economy (CAFE) penalty has been increased just once – from $5 to $5.50 for every 0.1 mile per gallon that doesn’t meet the standard – since its instatement in 1975. Congress acted to rectify the effects of inflation on the penalty by raising it to $14 in 2015, but NHTSA and the courts have ping-ponged about the increase ever since. A decision from the Second Circuit last August seemed to settle the issue in favor of instating the higher penalty starting with model year 2019, but automakers last October successfully petitioned that the increase be delayed.

The CAFE penalty can be a huge boon for zero emissions automakers, who receive credits that they can then sell to other OEMs who fail to meet the fuel efficiency target. In a recent report to regulators, Tesla said it earned $1.58 billion from selling regulatory credits to other automakers in 2020, up from $594 million in 2019. Delaying the increase harms companies that have made economic decisions on the basis of an increase to the credit, Tesla said.  

EV start-ups Rivian and Lucid Motors told TechCrunch they also oppose any delay to increasing the CAFE penalty.

“The credit market is very beneficial for the entire EV industry, so every company that is looking to start building EVs, either as a startup or the existing manufacturers, when they build EVs it’s to their benefit to have robust credits,” Kevin Vincent, Lucid Motor’s Associate General Counsel, told TechCrunch. “A lot of existing manufacturers end up selling credits themselves, so it benefits the forward-thinking companies that are improving fuel economy.”

James Chen, Rivian’s VP of Public Policy and Chief Regulatory Counsel, said in a statement to TechCrunch that any rollback of the CAFE or other emission standard “only sets the U.S. backwards in terms of emission reductions ([greenhouse gas] and criteria pollutants), increased fuel efficiency, reduction of dependence on foreign oil, technology leadership and EV proliferation.” He added that the company “strongly supports efforts to bolster EV adoption that includes more stringent emission standards and higher penalties for failure to meet those standards.”

NHTSA postponed the increase on the grounds that the penalty should not be retroactively applied to model years that had already been manufactured. As manufacturers have no way to increase the fuel economy level in these vehicles, “it would be inappropriate to apply the adjustment to model years that could have no deterrence effect and promote no additional compliance with the law,” NHTSA said.

Automakers, in a petition filed by the lobbying group Alliance for Automotive Innovation and in supplemental comments, also cited economic hardship due to the COVID-19 pandemic. Mercedes-Benz told NHTSA that the pandemic caused disruptions to its supply chain, workforce and production.

“We believe that retroactively applying an increased penalty rate in such a tenuous financial climate is unconscionable and inconsistent with this Administration’s efforts to promote regulatory relief in light of the economic consequences of COVID-19,” the automaker said.

Tesla maintained in its court filing that relying on the COVID pandemic “falls flat” in the absence of specific evidence as to why it warrants the delay.  

Attorney generals from 16 states, including California and New York, as well as environmental groups Sierra Club and the Natural Resources Defense Council, have also objected to the delay.

The NHTSA decision was issued in docket no. NHTSA-2021-0001. Tesla filed with the second circuit under case no. 21-593.

Closing on $103M, MaC VC is changing the face of venture capital

By Jonathan Shieber

The partners at MaC Venture Capital, the Los Angeles-based investment firm that has just closed on $103 million for its inaugural fund, have spent the bulk of their careers breaking barriers.

Formed when M Ventures (a firm founded by former Washington DC mayor Adrian Fenty); the first Black talent agency partner in the history of Hollywood, Charles D. King; and longtime operating executive (and former agent) Michael Palank joined forces with Marlon Nichols, a co-founder of the LA-based investment firm Cross Culture Capital, MaC Venture Capital wanted to be a different kind of fund.

The firm combines the focus on investing in software that Fenty had honed from his years spent as a special advisor to Andreessen Horowitz, where he spent five years before setting out to launch M Ventures; and Nichols’ thesis-driven approach to focusing on particular sectors that are being transformed by global cultural shifts wrought by changing consumer behavior and demographics.

“There’s a long history and a lot of relationships here,” said King, one of Hollywood’s premier power players and the founder of the global media company, Macro. “Adrian and I go back to 93 [when] we were in law school. We went on to conquer the world, where he went out to Washington DC and I became a senior partner at WME.”

Palank was connected to the team through King as well, since the two men worked together at William Morris before running business development for Will Smith and others.

“There was this idea of having connectivity between tech and innovation… that’s when we formed M Ventures [but] that understanding of media and culture… that focus… was complimentary with what Marlon was doing at Cross Culture,” King said.

Few firms could merge the cultural revolutions wrought by DJ Herc spinning records in the rec room of a Bronx apartment building and Sir Tim Berners Lee’s invention of the internet, but that’s exactly what MaC VC aims to do.

And while the firm’s founding partnership would prefer to focus on the financial achievements of their respective firms and the investments that now comprise the new portfolio of their combined efforts — it includes StokeGoodfairFinessePureStream, and Sote — it’s hard to overstate the significance that a general partnership that includes three Black men have raised $103 million in an industry that’s been repeatedly called out for problems with diversity and inclusion.

MaC Venture Capital co-founders Marlon Nichols, Michael Palank, Charles King, and Adrian Fenty. Image Credit: MaC Venture Capital

“Our LPs invested in us… for lots of different reasons but at the top of the list was that we are a diverse team in so many ways. We’re going to show them a set of companies that they would not have seen from any [other] VC fund,” said Fenty. “We also, in turn, have the same investing thesis when we look at companies. We want to have women founders, African American founders, Latino founders… In our fund now we have some companies that are all women, all African American or all Latino.”

The diversity of the firm’s ethos is also reflected in the broad group of limited partners that have come on to bankroll its operations: it includes Goldman Sachs, the University of Michigan, Howard University, Mitch and Freada Kapor, Foot Locker, and Greenspring Associates.

“We are thrilled to join MaC Venture Capital in this key milestone toward building a new kind of venture capital firm that is anchored around a cultural investment thesis and supports transformative companies and dynamic founders,” said Daniel Feder, Managing Director with the University of Michigan Investment Office, in a statement. “Their unified understanding of technology, media, entertainment, and government, along with a successful track record of investing, give them deep insights into burgeoning shifts in culture and behavior.”

And it extends to the firm’s portfolio, a clutch of startup companies headquartered around the globe — from Seattle to Houston and Los Angeles to Nairobi.

“We look at all verticals. We’re very happy to be generalists,” said Fenty.

A laser focus on software-enabled businesses is complemented by the thesis-driven approach laid out in position papers staking out predictions for how the ubiquity of gaming; conscious consumerism; new parenting paradigms; and cultural and demographic shifts will transform the global economy.

Increasingly, that thesis also means moving into areas of frontier technologies that include the space industry, mixed reality and everything at the intersection of computing and the transformation of the physical world — drawn in part by the firm’s close connection to the diverse tech ecosystem that’s emerging in Los Angeles. “We’re seeing these SpaceX and Tesla mafias spin out, entrepreneurs who have had best-in-class training at an Elon Musk company,” said Palank. “It’s a great talent pool, and LA has more computer science students graduating every year than Northern California.”

With its current portfolio, though early, the venture firm is operating in the top 5% of funds — at least on paper — and its early investments are up 3 times what the firm invested, Nichols said. 

“The way to think about it is MaC is essentially an extension of what we were building before,” the Cross Culture Ventures co-founder said. “We’re sticking with the concept that talent is ubiquitous but access to capital and opportunity is not. We want to be the source and access to capital for those founders.”

Elon Musk declares you can now buy a Tesla with Bitcoin in the U.S.

By Darrell Etherington

Tesla made headlines earlier this year when it took out significant holdings in bitcoin, acquiring a roughly $1.5 billion stake at then-prices in early February. At the time, it also noted in an SEC filing disclosing the transaction that it could also eventually accept the cryptocurrency as payment from customers for its vehicles. Now, Elon Musk says they’ve made that a reality, at least for customers in the U.S., and he added that the plan is for the automaker to ‘hodl’ all their bitcoin payments, too.

In terms of its infrastructure for accepting bitcoin payments, Tesla isn’t relying on any third-party networks or wallets — the company is “using only internal & open source software & operates Bitcoin nodes directly,” Musk said on Twitter. And when customers pay in bitcoin, those won’t be converted to fiat currency, the CEO says, but will instead presumably add to the company’s stockpile.

You can now buy a Tesla with Bitcoin

— Elon Musk (@elonmusk) March 24, 2021

In February when Tesla revealed its bitcoin purchase, observers either lauded the company’s novel approach to converting its cash holdings, or criticized the plan for its attachment to an asset with significant price volatility. Many also pointed out that the environmental cost of mining bitcoin seems at odds with Tesla’s overall stated mission, given its carbon footprint. Commenters today echoed these concerns, noting the irony of Tesla accepting the grid-taxing cryptocurrency for its all-electric cars.

As for how the bitcoin payment process works today, Tesla has detailed that in an FAQ. Customers begin the payment process from their own bitcoin wallet, and have to set the exact amount for a vehicle deposit based on current rates, with the value of Tesla’s cars still set in U.S. dollars. The automaker further notes that in the case of any refunds, it’s buyer-beware in terms of any change in value relative to the U.S. dollar from time of purchase to time of refund.

Musk also said that the plan is to expand Bitcoin payments to other countries outside the U.S. by “later this year.” Depending on the market, that could require some regulatory work, but clearly Musk thinks it’s worth the effort. Meanwhile, Bitcoin is up slightly on the news early Wednesday morning.

Insuretech startup Counterpart raises $10M in funding round led by Valor Equity Partners

By Mike Butcher

Insuretech startup Counterpart, has raised $10 million in funding led by Valor Equity Partners. Also participating was Susa Ventures and Felicis Ventures. Counterpart works in the ‘management liability’ insurance market. Counterpart will also partner with Markel Specialty, a specialty insurance division of Markel Corporation, to offer its management liability insurance products.

Insuretech startups like Oscar, Lemonade, and Root have made incursions into personal insurance. What has been less prevalent, says Counterpart, is startups tackling the $300bn corporate insurance market.

Counterpart is competing with Next Insurance which has raised $631M, and which also provides small business liability insurance, as well as the big insurance carriers, from AIG to Berkshire Hathaway.

Counterpart is used by some wholesale brokers in the United States to allow small to medium businesses get insurance coverage, because it digitizes much of the process, from application submission, coverage selection, binding, claims management, and loss prevention. Counterpart says this market has become less attractive to insurance carriers because of the increasing claims costs and severity, and their lack of digitization of the process.

Tanner Hackett, founder, and CEO, said in a statement: “The $1.2tn insurance industry is going through a digital revolution.. We saw an outsized opportunity with management liability, a critical insurance line in which we have unique expertise.”
 
Valor Equity Partners partner and Counterpart board member Jon Shulkin said: “Counterpart’s platform goes beyond the scope of a traditional insurer, layering in insights, tools, and services to help business stakeholders navigate this extremely challenging operating environment.”

Valor was an early backer of Tesla, SpaceX, Addepar, and GoPuff. Susa has previously backed Robinhood, PolicyGenius, and Newfront Insurance. Felicis has funded Hippo, Plaid, and Credit Karma.

His Majesty Elon the First, Technoking of Tesla

By Rebecca Bellan

Last week, Elon Musk made $25 billion in one day. On Monday, he crowned himself “Technoking of Tesla.” In Musk-speak, this new title still translates into the Chief Executive Officer of the electric car company. 

The eccentric billionaire is nothing if not creative with his dubs (see: Offspring named X Æ A-Xii.) Zach Kirkhorn, the company’s Chief Financial Officer, has also been bestowed the title of Master of Coin. A nod to Game of Thrones? Honestly, who knows? 

The new appellations were announced via a U.S. Securities and Exchange Commission filing, which reads: 

“Effective as of March 15, 2021, the titles of Elon Musk and Zach Kirkhorn have changed to Technoking of Tesla and Master of Coin, respectively. Elon and Zach will also maintain their respective positions as Chief Executive Officer and Chief Financial Officer.”

This title change follows Musk’s announcement last month that Tesla might start accepting bitcoin as a form of payment in the near future. The cryptocurrency’s stock price hit a new high of $61,788 over the weekend. 

Perhaps this is Musk’s not-so-subtle way of trying to let the world know who reigns supreme, especially after being bumped by Jeff Bezos as the richest person on the planet and after being sued by a Tesla investor for his continuous “erratic tweets” that potentially expose the electric vehicle company to fines and penalties that could drive its share price down. 

Musk’s announcement had a negligible impact on the stock price. Tesla’s stock is up 1.5% in morning trading. Tesla shares had an impressive 600% soar in 2020. However, the stock is now down 20% for the year from a high of $880.82 reached January 8. 

Tesla also disclosed on Monday that Jerome Guillen, president of automotive, will now take on the role of president of Tesla Heavy Trucking. In a 2020 Q4 earnings call, Musk said he expects deliveries of the Tesla Semi to begin this year. The engineering work on the freight-hauling truck with an all-electric powertrain is complete, but lack of availability to battery cells might halt production, Musk said during the call. 

Volkswagen will bring 240 gigawatt hours of battery production capacity to Europe by 2030

By Aria Alamalhodaei

Volkswagen AG is gearing up to seize the top spot as the world’s largest electric vehicle manufacturer with plans announced Monday to have six 40 gigawatt hour (GWh) battery cell production plants in operation in Europe by 2030.

To get there, the automaker put in a 10-year, $14 billion order with Swedish battery manufacturer Northvolt — and that’s only one of the six planned factories. A second plant in Germany will commence production in 2025.

The company also announced serious investments in charging infrastructure across China, Europe and the United States. It aims to grow its fast-charging network in Europe to 18,000 stations with its partner IONITY, 17,000 charging points in China through its joint venture CAMS New Energy Technology, and to increase the number of fast-charging stations in the United States by 3,500.

The company’s first dedicated battery event, a clear nod to Tesla’s Battery Day, also included a deep dive into novel battery chemistries that will reduce costs by up to 50%. The cell also paves the way for the transition to a solid-state battery cell, which the company anticipates for the middle of the decade. VW has made significant investments in solid-state battery manufacturer QuantumScape.

Volkswagen’s new Unified Premium Battery platform will be rolled out in 2023 and will be used across 80% of its EV models. The first to contain the new battery, the Audi Artemis, will be rolled out in 2024.

Scania AB, VW’s brand of heavy-duty trucks and buses, also has plans to increase its share of EVs. Departing from other major heavy-duty players that have opted for hydrogen fuel cells, company representatives on Monday said that it is unequivocally possible to electrify the heavy-duty transportation sector.

Looking to the battery’s end-of-life, VW said it will be able to recycle up to 95% of the battery through a process called hydrometallury.

Swedish battery manufacturer Northvolt receives a $14 billion order from VW

By Jonathan Shieber

Northvolt, the Swedish battery manufacturer which raised $1 billion in financing from investors led by Goldman Sachs and Volkswagen back in 2019, has signed a massive $14 billion battery order with VW for the next 10 years.

The big buy clears up some questions about where Volkswagen will be getting the batteries for its huge push into electric vehicles, which will see the automaker reach production capacity of 1.5 million electric vehicles by 2025.

The deal will not only see Northvolt become the strategic lead supplier for battery cells for Volkswagen Group in Europe, but will also involve the German automaker increasing its equity ownership of Northvolt.

As part of the partnership agreement, Northvolt’s gigafactory in Sweden will be expanded and Northvolt agreed to sell its joint venture share in Salzgitter, Germany to Volkswagen as the car maker looks to build up its battery manufacturing efforts across Europe, the companies said.

The agreement between Northvolt and VW brings the Swedish battery maker’s total contracts to $27 billion in the two years since it raised its big $1 billion cash haul.

“Volkswagen is a key investor, customer and partner on the journey ahead and we will continue to work hard with the goal of providing them with the greenest battery on the planet as they rapidly expand their fleet of electric vehicles,” said Peter Carlsson, the co-founder and chief executive of Northvolt, in a statement.

Northvolt’s other partners and customers include ABB, BMW Group, Scania, Siemens, Vattenfall, and Vestas. Together these firms comprise some of the largest manufacturers in Europe.

Back in 2019, the company said that its cell manufacturing capacity could hit 16 Gigawatt hours and that it had sold its capacity to the tune of $13 billion through 2030. That means that the Volkswagen deal will eat up a significant portion of expanded product lines.

Founded Carlsson, a former executive at Tesla, Northvolt’s battery business was intended to leapfrog the European Union into direct competition with Asia’s largest battery manufacturers — Samsung, LG Chem, and CATL.

Back when the company first announced its $1 billion investment round, Carlsson had said that Northvolt would need to build up to150 gigawatt hours of capacity to hit targets for. 2030 electric vehicle sales.

The plant in Sweden is expected to hit at least 32 gigawatt hours of production thanks, in part to backing by the Swedish pension fund firms AMF and Folksam and IKEA-linked IMAS Foundation, in addition to the big financial partners Volkswagen and Goldman Sachs.

Northvolt has had a busy few months. Earlier in March the company announced the acquisition of the Silicon Valley-based startup company Cuberg.

That acquisition gave Northvolt a foothold in the U.S. and established the company’s advanced technology center.

The acquisition also gives Northvolt a window into the newest battery chemistry that’s being touted as a savior for the industry — lithium metal batteries.

Cuberg spun out of Stanford University back in 2015 to commercialize what the company called its next-generation battery combining a liquid electrolyte with a lithium metal anode. The company’s customers include Boeing, BETA Technologies, Ampaire, and VoltAero and it was backed by Boeing HorizonX Ventures, Activate.org, the California Energy Commission, the Department of Energy and the TomKat Center at Stanford.

Cuberg’s cells deliver 70 percent increased range and capacity versus comparable lithium ion cells designed for electric aviation applications. The two companies hope that they can apply the technology to Northvolt’s automotive and industrial product portfolio with the ambition to industrialize cells in 2025 that exceed 1,000 Wh/L, while meeting the full spectrum of automotive customer requirements, according to a statement.

“The Cuberg team has shown exceptional ability to develop world-class technology, proven results and an outstanding customer base in a lean and efficient organization,” said Peter Carlsson, CEO and Co-Founder, Northvolt in a statement. “Combining these strengths with the capabilities and technology of Northvolt allows us to make significant improvements in both performance and safety while driving down cost even further for next-generation battery cells. This is critical for accelerating the shift to fully electric vehicles and responding to the needs of the leading automotive companies within a relevant time frame.”

 

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