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Elon Musk promises to take Tesla Model S to ‘Plaid’ with new powertrain

By Kirsten Korosec

Tesla CEO Elon Musk promised a more powerful powertrain option in future Model S, Model X and the next-generation Roadster sports car that will push acceleration and speed beyond the current high bar known as Ludicrous mode.

Musk tweeted Wednesday evening “the only thing beyond Ludicrous is Plaid,” a teaser to a higher performing vehicle and a nod to the movie Spaceballs.

The only thing beyond Ludicrous is Plaid

Elon Musk (@elonmusk) September 12, 2019

 

These new higher performing versions of the Model S, Model X, and Roadster will contain what Musk describes as a Plaid powertrain and is still about a year away from production. This new powertrain will have three motors, one more than the dual motor system found in today’s Model S and X.

Yes. To be clear, Plaid powertrain is about a year away from production & applies to S,X & Roadster, but not 3 or Y. Will cost more than our current offerings, but less than competitors.

— Elon Musk (@elonmusk) September 12, 2019

This Plaid powertrain has already seen some action. Tesla revealed Wednesday that a Model S equipped with a Plaid powertrain and chassis prototype had lapped Laguna Seca racetrack in 1:36:555, a second faster than the record for a four-door sedan.

*~ Some personal news ~*

We lapped Laguna Seca @WeatherTechRcwy in 1:36.555 during advanced R&D testing of our Model S Plaid powertrain and chassis prototype

(That’s a second faster than the record for a four-door sedan) pic.twitter.com/OriccK4KCZ

— Tesla (@Tesla) September 12, 2019

 

The “Plaid” powertrain will not be offered in the lower cost Model 3 or Model Y, which isn’t expected to go into production until late 2020. Musk also promised that this plaid powertrain will cost more than “current offerings, but will be less than competitors” without explaining what that means.

Cclose followers of the automaker might recall hints of a three motor powertrain in the past.

When Tesla unveiled a new Roadster prototype in November 2017, Musk said it would have three motors and be able to travel a whopping 0 to 60 miles per hour in 1.9 seconds and a top speed of 250 mph or even more. The Roadster isn’t expected to go into production until 2020.

What is new are Tesla’s plans to make this more powerful three-motor powertrain available in the Model S and Model X. And it stands to be an important option, if it does in fact materialize. The Model S has been around since 2012 and since the introduction the cheaper Model 3, sales have dipped.

And yet, Musk has said the X and S won’t be getting a major refresh. If Tesla hopes to maintain demand for either of its higher margin luxury vehicles, new trims like this plaid powertrain will be essential.

Tesla first announced Ludicrous mode in its Model S vehicles way back in July 2015. As shareholders and customers awaited the Model X to arrive, Musk unveiled several options for the company’s Model S sedan, including a lower priced version, longer battery range and “Ludicrous mode” for even faster acceleration.

Ludicrous mode, which improved acceleration by 10% to let drivers go from 0 to 60 mph in 2.8 seconds, came about as a result of an improved battery fuse. This new fuse, Musk explained in a blog post at the time, has its own electronics and a tiny lithium-ion battery that monitors current and protects against excessive current.

Tesla also upgraded the main pack contactor with a high-temperature space-grade superalloy instead of steel. This enabled the battery pack to remain “springy” under the heat of heavy current. In the end, the max pack output increased from 1300 to 1500 Amps.

Ludicrous was a $10,000 add on for new buyers. Tesla did reduce the price for existing Model S P85 owners for the first six months following the announcement and sold them the pack electronics upgrade needed for Ludicrous Mode for $5,000.

Musk joked in this 2015 blog post that there is “one speed faster than ludicrous, but that is reserved for the next generation Roadster in 4 years: maximum plaid.”

Tesla Autopilot was engaged before 2018 California crash, NTSB finds

By Kirsten Korosec

A Tesla Model S was in Autopilot mode — the company’s advanced driver assistance system — when it crashed into a fire truck in Southern California last year, according to a preliminary report released Tuesday by the National Transportation Safety Board.

Reuters was the first to report on the contents of the public documents. A final accident brief, including NTSB’s determination of probable cause, is scheduled to be published Wednesday.

The crash, involving a 2014 Tesla Model S, occurred January 22, 2018 in Culver City, Calif. The Tesla had Autopilot engaged for nearly 14 minutes when it struck a fire truck that was parked on Interstate 405. The driver was not injured in the crash and the fire truck was unoccupied.

Tesla has not commented on the report. TechCrunch will update if the company provides a statement.

The report found that the driver’s hands were not on the wheel for the vast majority of that time despite receiving numerous alerts. Autopilot was engaged in the final 13 minutes and 48 seconds of the trip and the system detected driver-applied steering wheel torque for only 51 seconds of that time, the NTSB said. Other findings include:

  • The system presented a visual alert regarding hands-off operation of the Autopilot on four separate occasions.
  • The system presented a first-level auditory warning on one occasion; it occurred following the first visual alert.
  • The longest period during which the system did not detect driver-applied steering wheel torque was 3 minutes and 41 seconds.

In the 2018 crash into a fire truck, the vehicle was operating a “Hardware Version 1” and a firmware version that had been installed via an over-the-air software update on December 28, 2017. The technology provided a number of convenience and safety features, including forward, lane departure and side collision warnings and automatic emergency braking as well as its adaptive cruise control and so-called Autosteer features, which when used together

Public docket opened Tuesday, for investigation of Jan. 22, 2018, Culver City, California, highway crash involving a Tesla & Culver City Fire Dept. fire truck; https://t.co/UbgF0ll9dA. Final accident brief, including probable cause, slated to publish Sept. 4, 2019.

— NTSB_Newsroom (@NTSB_Newsroom) September 3, 2019

While the report didn’t find any evidence that the driver was texting or calling in the moments leading up to the crash, a witness told investigators that he was looking down at what appear to be a smartphone. It’s possible that the driver was holding a coffee or bagel at the time of the crash, the report said.

Autopilot has come under scrutiny by the NTSB, notably a 2016 fatal crash in Florida and a more recent one involving a Walter Huang, who died after his Model X crashed into a highway median in California. The National Highway Traffic Safety Administration also opened an inquiry into the 2016 fatal crash and ultimately found no defects in the Autopilot system. NTSB determined the 2016 fatal crash was caused by a combination of factors that included limitations of the system.

The family of Huang filed in May 2019 a lawsuit against Tesla and the State of California Department of Transportation. The wrongful death lawsuit, filed in California Superior Court, County of Santa Clara, alleges that errors by Tesla’s Autopilot driver assistance system caused the crash.

Tesla’s Model 3 interior (even the steering wheel) is now 100% leather-free

By Kirsten Korosec

Tesla said Saturday that its Model 3 interiors are now completely free of leather, fulfilling a promise made by CEO Elon Musk at this year’s annual shareholder meeting.

Tesla has been closing in on a leather-free interior for a couple of years now. But a sticking point was the steering wheel, which Musk made mention of at the company’s shareholder meeting in June in response to a request from PETA activist.

I believe we were close to having a non-heated steering wheel, that’s not leather,” Musk said at the time.There are some challenges when when heat the non-leather material and also how well it wears over time.”

Musk said Model Y and Model 3 would be vegan by 2020. He wasn’t sure if the company would be able to meet that same goal for the Model S and X.

Model 3 interior is now 100% leather-free 🐄pic.twitter.com/2F47zp8A4T

— Tesla (@Tesla) August 31, 2019

 

 

Activist shareholders made a proposal in 2015 that Tesla no longer use animal-derived leather in the interiors of its electric vehicles by 2019. While stockholders rejected that proposal, Tesla did begin rolling out more “vegan” interior components in its cars.

The company began by offering leather-free seats as an option. Two years ago, Tesla made the synthetic material standard in its Model 3, Model X and Model S vehicles.

Walmart and Tesla are going to try and work things out

By Kirsten Korosec

Walmart came out swinging earlier this week in a lawsuit that accused Tesla of breach of contract and gross negligence over problems with rooftop solar panel systems installed at the retail giant’s stores.

Now, just days later, the lawsuit has been placed on hold while the two companies try to reach an agreement that would keep the solar installations in place and put them back in service, according to a joint statement issued late Thursday night.

“Walmart and Tesla look forward to addressing all issues and re-energizing Tesla solar installations at Walmart stores, once all parties are certain that all concerns have been addressed,” the statement read. “Together, we look forward to pursuing our mutual goal of a sustainable energy future. Above all else, both companies want each and every system to operate reliably, efficiently, and safely.”

Walmart hasn’t dropped the lawsuit. The complaint is still on file with New York state court. But the two parties are going to try to reach an agreement that would avoid a lawsuit.

The lawsuit, which is aimed at Tesla’s energy unit that was formerly known as SolarCity, alleges that seven fires on Walmart rooftops were caused by the solar panel systems. Walmart asked Tesla to remove the solar panel systems on all 244 stores where they are currently installed and to pay for damages related to fires that the retailer alleges stem from the panels.

Now, a Walmart spokesperson said it is “actively working towards a resolution” with Tesla.

Neither Tesla or Walmart would explain the details of the negotiations.

The stakes are high for Tesla. Earlier this month, Tesla CEO Elon Musk  announced a new rental offering for solar power in a bid to reboot the flagging renewable energy business.

Tesla’s share of the solar market has declined since its merger with SolarCity in 2016. In the second quarter Tesla deployed only 29 megawatts of new solar installations, while the number one and two providers of consumer solar, SunRun and Vivint Solar, installed 103 megawatts and 56 megawatts, respectively.

Tesla’s renewable energy business includes residential and commercial solar and energy storage products. The company also has a utility-scale energy product called Megapack. While Tesla still produces solar panels for residential use, much of its focus has been on developing its solar roof, which is comprised of tiles. It still operates a commercial business, which targets municipalities, schools, affordable housing, enterprise and agriculture and water districts as customers.

The company doesn’t provide a breakdown of its solar installations, making it difficult to determine if the commercial business is flat, falling or on the rise. Language in its latest 10-Q suggests Tesla is putting a renewed effort into its solar business.

Tesla said it’s working on revamping the customer service experience for solar products, according to the 10-Q. The company said while its retrofit solar system deployments have it expects they “will stabilize and grow in the second half of the year.”

Should you raise equity venture capital or revenue-based investing VC?

By Arman Tabatabai
David Teten Contributor
David Teten is a Venture Partner with HOF Capital. He was previously a Partner for 8 years with HOF Capital and ff Venture Capital. David writes regularly at teten.com and @dteten.

Most founders who are raising capital look first to traditional equity VCs. But should they? Or should they look to one of the new wave of revenue-based investors?

Revenue-based investing (“RBI”) is a new form of VC financing, distinct from the preferred equity structure most VCs use. RBI normally requires founders to pay back their investors with a fixed percentage of revenue until they have finished providing the investor with a fixed return on capital, which they agree upon in advance.

This guest post was written by David Teten, Venture Partner, HOF Capital. You can follow him at teten.com and @dteten. This is the 5th part of our series on Revenue-based investing VC that touches on:

From the founders’ point of view, the advantages of the RBI model are:

Tesla pitches a solar rental program to boost its renewable energy business

By Jonathan Shieber

Tesla is pitching customers on a new rental offering for solar power as a way to revive the flagging fortunes of its renewable energy business.

Once among the largest installers of renewables in the country through SolarCity, Tesla has seen its share of the market decline significantly since its acquisition of SolarCity three years ago. In the second quarter Tesla deployed only 29 megawatts of new solar installations, while the number one and two providers of consumer solar, SunRun and Vivint Solar installed 103 megawatts and 56 megawatts respectively.

That’s likely one reason why Elon Musk took to Twitter early Sunday morning to pitch the new solar rental program.

One click to order solar & save ~$500/year in utility bills with no long-term contract (cancel anytime)

— Elon Musk (@elonmusk) August 18, 2019

According to Musk, the new program is “like having a money printer on your roof” for potential customers who live in states with high energy costs. “Still better to buy,” Musk exhorted, “but the rental option makes the economics obvious.”

Unlike SunRun and Vivint, which both used partnerships with homebuilders and retailers like Home Depot, BJ’s Wholesale, Costco and Sam’s Club to acquire customers, Tesla slashed ended door-to-door marketing and abandoned its partnership with Home Depot. The company began relying almost entirely on direct sales to power its solar business and eschewed the no-money-down lease model, which SolarCity had used so effectively.

Under the new system, Telsa is offering customers the option to rent solar systems for anywhere from $65 for a small installation to $195 for its largest installation. Customers only need to pay a fully refundable $100 charge.

Tesla said the contract can be canceled any time, but it would charge users $1,500 to remove the system once it has been installed.

Tesla did not respond to a request for comment at the time of publication.

 

Audi e-tron becomes the first all-electric vehicle to earn IIHS top safety rating

By Kirsten Korosec

The 2019 Audi e-tron has become the first battery-electric vehicle to earn a top safety rating from the Insurance Institute for Highway Safety, an achievement that Tesla and other electric models like the Chevy Bolt have not been able to capture.

Scoring an IIHS top safety award isn’t easy. A vehicle has to earn good ratings in six crashworthiness evaluations, as well as an advanced or superior rating for front crash prevention and a good headlight rating.

IIHS said Wednesday that the e-tron fulfills the criteria to earn a top safety rating with standard equipment. The vehicle performed well in crashworthiness testing, earning good ratings in the driver-side small overlap front, passenger-side small overlap front, moderate overlap front, side, roof strength and head restraint tests, according to IIHS.

The SUV’s standard front crash prevention system rated superior in IIHS track tests. It avoided a collision in the 25 mph test and reduced its impact speed by an average of 11 mph in the 12 mph test. Its forward collision warning component meets National Highway Traffic Safety Administration criteria.

The award provides a much needed boost to the e-tron. There’s a lot riding on the e-tron, the German automaker’s first mass-produced electric vehicle. And while TechCrunch’s Matt Burns found it quick, comfortable and familiar, the vehicle has had a rocky start that included a voluntary recall in the U.S. due to the risk of battery fire.

Tesla has gotten close to the top safety pick designation. A Tesla Model S was tested in 2017 and performed well, but fell short of earning the top score due to poor headlights and an “acceptable” score in the small overlap crash test. The IIHS has never tested the Tesla Model X.

The electric automaker does have another chance. This time, it’s with the Tesla Model 3, which IIHS is currently testing, according to a recent tweet from the organization.

Tests of the 2019 Tesla Model 3 commence next week with the side crash test. pic.twitter.com/yXtbGDC9h9

— IIHS (@IIHS_autosafety) August 7, 2019

The Model 3 has already achieved an all-around five-star safety rating from the National Highway Traffic Safety Administration. Despite the high marks, NHTSA and Tesla have tussled over how the automaker has characterized the rating in an October 7 blog post when it said the Model 3 had achieved the lowest probability of injury of any vehicle the agency ever tested.

Earlier this month, Hyundai’s hydrogen fuel cell SUV, the Nexo, became the first fuel cell vehicle to be tested and to earn IIHS’s top safety award. 

Tesla Model 3 owner implants RFID chip to turn her arm into a key

By Kirsten Korosec

Forget the keycard or phone app, one software engineer is trying out a new way to unlock and start her Tesla Model 3.

Amie DD, who has a background in game simulation and programming, recently released a video showing how she “biohacked” her body. The software engineer removed the RFID chip from the Tesla Model 3 valet card using acetone, then placed it into a biopolymer, which was injected through a hollow needle into her left arm. A professional who specializes in body modifications performed the injection.

You can watch the process below, although folks who don’t like blood should consider skipping it. Amie DD also has a page on Hackaday.io that explains the project and the process.

The video is missing one crucial detail. It doesn’t show whether the method works. TechCrunch will update the post once a new video delivering the news is released.

Amie is not new to biohacking. The original idea was to use the existing RFID implant chip that was already in her hand to be able to start the Model 3. That method, which would have involved taking the Java applet and writing it onto her own chip, didn’t work because of Tesla’s security. So, Amie DD opted for another implant.

Amie DD explains why and how she did this in another, longer video posted below. She also talks a bit about her original implant in her left hand, which she says is used for “access control.” She uses it to unlock the door of her home, for instance.

 

 

US regulators take aim at Tesla over Model 3 safety claims

By Kirsten Korosec

Tesla’s claims about the safety of its Model 3 electric vehicle prompted U.S. regulators to send a cease-and-desist letter and escalate the matter by asking the Federal Trade Commission to investigate, according to documents released by the nonprofit legal transparency website PlainSite.

The documents show correspondence between the lawyers at National Highway Traffic Safety Administration and Tesla that began after the automaker’s October 7 blog post that said the Model 3 had achieved the lowest probability of injury of any vehicle the agency ever tested. PlainSite received the 79 pages of communications since January 2018 between NHTSA and Tesla through a Freedom of Information Act request. There were 450 pages of communication that were withheld due to Tesla’s request for confidentiality on the basis of “trade secrets.”

NHTSA took issue with the blog post, arguing that Tesla’s claims were inconsistent with its advertising guidelines regarding crash ratings. The matter might have ended with that demand. But NHTSA took the issue further and informed Tesla it would ask the Federal Trade Commission to weigh in.

“This is not the first time that Tesla has disregarded the guidelines in a matter that may lead to consumer confusion and give Tesla an unfair market advantage,” the letter dated October 17 reads. “We have therefore also referred this matter to the Federal Trade Commission’s Bureau of Consumer Protection to investigate whether these statements constitute unfair or deceptive acts or practices.”

Tesla did not respond to a request for comment.

The automaker’s lawyers did, however, push back against NHTSA’s request, according to the correspondence released by PlainSite. Tesla lawyers argue in one letter that the company’s statements were neither “untrue nor misleading.”

“To the contrary, Tesla has provided consumers with fair and objective information to compare the relative safety of vehicles having 5-star overall ratings,” the letter from Tesla’s deputy general counsel.

The documents posted by PlainSite also showed NHTSA requested sales data on all Tesla vehicles produced since July 2016 with or without Autopilot, the automaker’s advanced driver assistance system. The agency also issued subpoenas to Tesla ordering it to produce information on several crashes, including a January 25, 2019 crash in San Ramon, Calif. The subpoenas requested information about the vehicle, its owner, history and videos and images related to the crash and were to be sent to NHTSA’s Office of Defects Investigations.

Not your typical startup: How being a cooperative drives our business and product development

By Arman Tabatabai
Pola Henderson & Maxime Bouroumeau-Fuseau Contributor
Pola Henderson is a communications specialist and Digicoop’s Content & Community Manager. Maxime Bouroumeau-Fuseau is a developer, entrepreneur, and co-founder of Digicoop.

Our French startup Digicoop is a remote-first worker cooperative. We started the company in 2015, based on our shared values and passion for technology. The goal was simple: make good products that will have a positive impact on companies. The road to funding, not so simple.

Due to our unique business model, which focuses on building a sustainable company, we had to forego venture capital and convince lots of players to take a chance. The effort paid off. Here’s a look at why we chose to be a co-op, how we got the funding and how it drives our product development.

Table of Contents

Raison d’être

Unlike many startups, Digicoop wasn’t founded because of a particular product. Our story is a bit different. In 2015, a few friends and former colleagues came together to work on projects they were passionate about. Initially we didn’t know what those would be, but we quickly figured out the theme: collaborative work tools for teams. 

Making that our focus was no coincidence. We recognized that the workplace was changing: distributed teams were becoming more common, and with that more transparency and an increased cross-team collaboration necessary. We became frustrated with traditional work tools and processes, as they were no longer enough.

We saw an opportunity to develop products suitable for the digital future, but that wasn’t our only driver. Being passionate about technology and the impact it can have on the society, we set out to build tools that could make a positive difference. The idea was to empower employees, not only managers.

Our shared values and vision of the workplace were the reason we decided to go against the grain and structure Digicoop as a worker cooperative (called SCOP in France), giving each employee a real stake in the company.

SCOP: We’re all in this together

Tesla brings back free unlimited supercharging for the Model S and X

By Kirsten Korosec

Tesla is resurrecting a popular benefit that CEO Elon Musk once called “unsustainable” as it attempts to boost sales of its more expensive electric vehicles.

Tesla announced Saturday that all new Model S sedans and Model X SUVs will come with free unlimited access to its network of electric vehicle chargers known as superchargers.

The move comes on the heels of a second quarter of wider-than-expected losses of $408 million despite record deliveries of its electric vehicles.

The automaker reported in July it delivered a record 95,200 of its electric vehicles in the second quarter, a dramatic reversal from a disappointing first period. The company generated $6.3 billion in revenue in the second quarter from those sales, the bulk of which came from its lower margin and less expensive Model 3 vehicles.

Meanwhile, sales of the Model S and Model X have slowed. Of its 95,200 deliveries, just 17,650 were Model S and X vehicles. Tesla doesn’t separate delivery or production figures for the S and X.

BREAKING: All new Model S and Model X orders now come with ⚡ free ⚡ unlimited ⚡ Supercharging ⚡

— Tesla (@Tesla) August 3, 2019

In its early days, free unlimited supercharging was part of the package of buying a Tesla vehicle.

Tesla began phasing out free unlimited access to its supercharger network when it announced that customers who buy cars after January 1, 2017 will have 400 kilowatt-hours, or about 1,000 miles, of free charging every year. Once owners surpassed that amount, they would be charged a small fee.

Will see what we can do. Really need to bring this program to an end while being as fair as possible. It’s not sustainable long-term.

— E (@elonmusk) September 17, 2018

Tesla then narrowed the free unlimited access to superchargers through a referral program and only to buyers of performance versions of the Model S, Model X and Model 3. The free unlimited supercharger referral program is now set to end September 18.

Musk has brought back the perk several times since to drive sales.

It’s unclear how long this latest offer will last. The company has been tinkering with its pricing structure, vehicle configurations and rewards programs, with changes occurring monthly.

Tesla will deliver in-car YouTube and Netflix video streaming ‘soon’

By Darrell Etherington

Tesla is getting ready to “soon” deliver the in-car video streaming services that CEO Elon Musk suggested would eventually come to the automaker’s cars. Musk shared this (somewhat vague) updated timeline on Twitter over the weekend, after noting earlier in June at E3 that Tesla’s infotainment displays would eventually be getting YouTube and streaming video support.

This is also the first time Musk has specifically said that both YouTube and Netflix would be coming, after previously noting that version 10 of the in-car software would support video streaming generally in reply to a question from a fan on Twitter. Musk added that these would be available to stream video only while the vehicle is stopped — but the plan is to change that once full self-driving becomes a reality.

Once full autonomous driving capabilities are “approved by regulators,” Musk said, the plan is to turn on the ability to stream video in the vehicle while it’s in motion. This plan likely extends to Tesla’s in-car gaming features, too — though that’s a separate level of distraction as you’re actually interacting with what’s happening on the screen, which may not be the best idea for initial roll-out of autonomous features where a driver might be required to take over manual control in case of any incidents.

The Tesla CEO said the experience of watching video on Netflix and YouTube in a Tesla vehicle is akin to “an old-school drive-in movie experience, but with much better sound” and that it has an “immersive, cinematic feel” thanks to the surround audio available via the Tesla’s audio system and its “comfy seats.”

It may seem like a weird software update priority for a car, but it’s entirely possible Tesla owners spent so much on their vehicles that they don’t have spare cash for a fixed address, in which case an entertainment system for their tiny apartment actually makes a lot of sense.

Tesla starts rolling out Chess to ‘Tesla Arcade’ in-car gaming app

By Darrell Etherington

Tesla is making a new game available to its vehicle owners, with a roll-out starting today. The company started pushing out a new ‘Arcade’ app for its in-car infotainment system back in June at the annual E3 gaming conference, and now it’s adding the most thrilling game around to the mix: Chess.

This isn’t the first time games have been on Tesla’s infotainment screens; its had them available as ‘Easter eggs,’ or hidden software features. Tesla began demoing Arcade in its showrooms back in June, too, so that visitors to their showrooms could come in and give it a try through June 30.

Tesla’s teaser for the release of the Chess game includes a western-themed Tesla driver playing in a field, which is an interesting narrative choice. The promo also notably has the person using this while parked, which is the only way you can actually play the games for obvious reasons.

When your car can do zero-to-sixty faster than you can make your next move, we call that a checkmate.

Chess begins rolling out to the Tesla Arcade globally today 🤠♟pic.twitter.com/cNRf3kAtAA

— Tesla (@Tesla) July 26, 2019

In addition to the update going out broadly, Tesla also announced that ‘Beach Buggy Racing’, a kart racing game you can control with the Tesla’s steering wheel, gets an update which will let you use two game controllers as once to do local multiplayer with a passenger. Again, not while driving.

Bethesda also revealed at E3 that mobile game Fallout Shelter being played on the in-car display, and Musk has discussed opening up the platform more broadly to developers, so we’ll see if that’s the next step after this rollout of the Arcade app to users.

Tesla focuses on service with 25 new service centers in Q2, rate of new openings to ‘increase’

By Darrell Etherington

Tesla is set to aggressively ramp up the rate at which it opens new service facilities, according to CEO Elon Musk’s guidance on the company’s Q2 2019 earnings call. In total, Tesla opened 25 new service centers during the quarter, and added 100 new service vehicles to its existing fleet — which is in contrast to an earlier statement made by Musk that they’d look to close most of their physical stores in an effort to reduce costs.

Notably, Musk referred to the locations only as “service centers” during his comments on the subject on Wednesday’s earnings call, and never as stores — asked about “retail locations,” he corrected the analyst asking and again said that what Tesla opened were “service centers” specifically. He also emphasized the importance of ensuring that service scales in line with the size of Tesla’s overall fleet of vehicles in active use. Musk mentioned that the number of Tesla cars on the road doubled in the last year alone, meaning it’s seeing exponential growth in terms of the total size of the fleet it needs to service.

“Service scales not just with new production, but as the whole fleet sales,” Musk said, adding that they want to grow their service capabilities in a way that’s responsible when it comes to cost, but that that is “quite difficult” when it comes to the rate at which the company’s sales and shipments are increasing.

Even so, Tesla is taking on still more of its service work itself, rather than outsourcing to external vendors.

“We’ve in-sourced a great deal of the collision repair activities, which I think had quite a good impact on customer happiness,” Musk said. “This will continue in the months to come.” Musk also noted that the company is working hard to reset its processes in order to ensure that parts are available on-hand when and where needed for service, which is a gap that has prompted customer complaints in the past.

The Tesla CEO said that he meets with the Tesla service team “multiple times a week” to “get updates on the reliability of the vehicle,” noting the best service possible is “no service” because that would represent maximum reliability (and of course, lowest possible ongoing costs for Tesla). He also said that they’ve seen “fewer and fewer service visits for the most recent cars that we’re building, so we’re on a good trend there.”

Jerome Guillen, President of Automotive at Tesla also noted that the number one reason for service visits is actually people looking to learn how to use Autopilot, and in general education represents a high percentage of visits.

Tesla CFO Zach Kirkhorn addressed a question about the service center expansion later in the call, adding that the company is pursuing a path of systematic “focus on service and supercharging, as opposed to a retail presence.” He also noted that he believes efforts to improve their parts distribution, with a focus on ensuring that parts are available on-hand in inventory at the service centers where they’re needed will actually help bring down costs overall versus housing them centrally or ordering on-demand from suppliers and Tesla’s own fabrication facilities.

Tesla has begun preparations for Model Y production at its Fremont factory

By Darrell Etherington

Tesla has already started the preparations required to get production started on its forthcoming Model Y compact all-electric SUV, according to Tesla CEO Elon Musk . During his introductory comments on the automaker’s Q2 2019 earnings call, Musk noted that prep had started at its facility in Fremont, confirming a report from CNBC from March.

In Tesla’s first earnings call for 2019, Musk said that it was in the process of deciding between Fremont and its Gigafactory in Nevada for production of the Model Y, which is going to be based on the Model 3 platform and will share some of its componentry, something that Musk noted will help reduce its cost of production.

The Model Y, revealed in March, looks quite similar at first glance to the Model 3. It has a slightly higher profile, however, putting it in this compact SUV range. It has similar interior features to the Model 3, including the horizontal 15-inch touchscreen, and also features a panoramic roof more like its larger Model X premium all-electric SUV sibling. Pricing for the Model Y will begin at $39,000, and that version will have a 230-mile range. It’s currently planned to ship sometime in the fall of 2020.

Tesla should be able to get to around 7,500 to 8,000 Model Ys produced at Fremont by the end of the year, Musk confirmed in response to a question from an analyst on the call.

Tesla reports larger-than-expected losses of $408 million in second quarter

By Kirsten Korosec

Tesla reported Wednesday a wider-than-expected loss of $408 million, or $2.31 per share, and generated $6.3 billion in revenue in the second quarter despite record deliveries of its electric vehicles.

Earlier this month, Tesla reported it delivered 95,200 of its electric vehicles in the second quarter, a dramatic reversal from a disappointing first period. Those numbers have been since adjusted to 95,356 vehicles. The record-breaking figures stood in stark contrast to the company’s first quarter delivery numbers when it reported deliveries of 63,000 vehicles, nearly a one-third drop from the previous period.

Analysts surveyed by FactSet were expecting an adjusted loss of 35 cents a share on revenue of $6.47 billion. The net loss in the second quarter included a $117 million of restructuring and other charges, the company said in its earnings report.

A recovery from Q1

While earnings missed Wall Street expectations, Tesla has recovered since the first quarter of the year when it posted a loss of $702 million, or $4.10 a share, after disappointing delivery numbers, costs and pricing adjustments to its vehicles cut into profits. When adjusted for one-time losses, Tesla lost $494 million, or $2.90 a share in the first quarter.

Revenue has also jumped 40% from $4.5 billion in the first quarter to $6.3 billion in the second period thanks again to the increase in sales, particularly for the Model 3.

The company is also sitting on substantially more capital. Tesla ended the second quarter with $5 billion in cash and cash equivalents — the highest level in Tesla history — a figure that was boosted by a public offering of equity and convertible bonds, which netted $2.4 billion.

Tesla generated free cash flow (operating cash flow less capital expenditures) of $614 million in the second quarter compared to a loss of $920 million in the first quarter.

Tesla’s financial picture has also improved when compared to the same quarter in 2018, when it posted a loss of $718 million, or $4.22 a share, on $4 billion of revenue.

Automotive gross margins

Notably, the company’s automotive gross margins have narrowed to 18.9% in the second quarter compared to 20.6% in the same quarter last year based on generally accepted accounting principles. Tesla said it will continue to make progress reducing the cost of the product, including through volume growth, lowering material cost, reduction of labor hours per vehicle and reduction of logistics costs.

Tesla said that Model S and Model X gross margin were impacted by pricing actions on vehicles with the prior powertrain version. Inventory of these vehicles has decreased materially into the third quarter, the company added.

Tesla has previously said it is targeting 25% automotive gross margins for Model S, Model X and Model 3. But that didn’t happen in the first quarter and it slid further in the second quarter.

Tesla’s margins were buffeted in the past by sales of the higher-priced (and better margin per vehicle) Model S and X. Now Tesla is in an awkward spot where demand for the Model 3 hasn’t been enough to stave off contracting margins caused by a decline in Model S and X sales. Model 3s have a lower profit margin per vehicle than the S or X.

Sticking to guidance

Tesla noted that its Fremont, Calif. factory “has demonstrated capability of a 7,000 Model 3 vehicles per week run rate, which the company says it continues to work to increase. Tesla said it aims to produce 10,000 total vehicles of all models per week by the end of 2019.

Tesla is sticking to its previous guidance of 360,000 to 400,000 vehicle deliveries this year.

The automaker also expects positive quarterly free cash flow with an important caveat that it could reverse into loss around the launch and ramp of new products. Tesla is planning to produce the Model Y by fall 2020 and it has a slate of other products on the docket, including the new Roadster and Tesla Semi.

Tesla has reduced its guidance for capital expenditures to between $1.5 billion and $2 billion.

BMW 2019 i8 review: Driving yesterday’s car of tomorrow, today

By Matt Burns

The BMW i8 is a lovely vehicle to drive even though it’s lacking. It hugs the road and commands attention. It’s thrilling in a way that few cars can achieve without speed. Sure, it’s quick, but it won’t set track records or quarter-mile times. It just feels great to drive.

By the numbers, there’s little reason to buy a $164,000 BMW i8 Roadster. Want speed? Buy a Porsche 911 Turbo for $161K or Corvette ZR1 for $123K or Nissan GT-R for $112K. Supercar aesthetics? Get an Acura NSX for $157K. Want all-electric? Get a Tesla Model S. All are faster and cheaper than the BMW i8.

The BMW i8 is just a stepping stone in BMW’s history. An oddball. It’s a limited-edition vehicle to try out new technology. From what I can tell, BMW never positioned the i8 as a top seller or market leader. It was an engineer’s playground. I love it.

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Review

BMW released the first i8 in 2014 when the automotive scene looked different. Tesla was still a fledgling startup with only the Model S in its lineup. GM was working on the second-generation Chevy Volt. Hybrid powertrains seemed to be the answer, and BMW followed suit with the dual-power in the i8.

In 2015 I took the just-launched i8 from Vegas to LA in an epic, one-day adventure that took me through the Mojave Desert and Joshua Tree National Park. It was a great way to appreciate the i8, and now that the model is on its way out, I wanted another go in the car.

This time, I had an i8 tester for a week. I took my kids to school in it, I got groceries with it and, in between rain storms, I lived my best life with the top down on in this $164,000 droptop.

It’s a lovely car and garners attention like nothing else in its price range. I noted this several years back when driving the i8 down the Vegas strip. The i8 is stunning and always draws a crowd. For my money, there isn’t a car that gets more attention.

The sheet metal flows as if a master glassmaker made it. It’s beautiful. The front end is aggressive and direct. The sides flow with precision to a back-end with some of the most unique tail lights available. The exhaust — remember, this is a hybrid — exits behind the rear window through a metal grate.

Don’t let its go-fast exterior oversell the capabilities though. The i8 is not as fast as it looks.

The i8 isn’t a quarter-mile racer. This is a hybrid sports car with the heart of a grand tourer. This isn’t a car you want to take to a drag strip, but it could be fun at a track day. It’s a carver. Its low center of gravity lets it embrace the road. It’s silky through flowing corners.

Behind the wheel, the i8 is easy to love. The hybrid powertrain is smooth and free of drama. Hit the gas and go. Click the transmission to sport mode and it’s quick, but not fast. And that’s okay with me.

BMW got the inside of the i8 right. For a two-seat exotic, the i8 is comfortable and functional as long as the driver doesn’t need to transport golf clubs. The scissor doors open with little effort and offer enough room to enter and exit the car. The seats are supportive and comfortable. This 2019 version is equipped with BMW’s latest infotainment system, which is among the best offered in the industry. There is very little storage available in the Roadster variant that ditches the back seats for the droptop storage. The trunk can hold four six-packs and nothing else.

When I drove the i8 in 2015, I stated that this was a car someone should buy only after they have their Porsche 911. That’s still true. While the i8 is easy to love, there are other vehicles available that offer more thrills and functionality.

The i8 is easy. Drivers shouldn’t be afraid to push the powertrain. It won’t bite, but it will provide plenty of excitement in sport mode. The i8 doesn’t require the skill of other vehicles in its price range. If a Porsche 911 Turbo or Corvette ZR-1 is too much car, look at the i8. Or the Audi R8 — another sports car I found easy to boss around.

After a week of living with the i8, its performance was secondary to the experience. I’m convinced that the i8 doesn’t need raw speed to be enjoyable.

In 2014 BMW proclaimed the i8 to be the car of tomorrow, available today. And in some regards it was. The i8 was one of the first mass-production vehicles to pair an electric powertrain to a gas engine in the name of performance. Since then, nearly every exotic automaker is doing the same in various formats.

The i8 still feels like it’s a different type of vehicle than anything else available. It feels green. It feels healthy. But in the end, the i8 still relies on a dirty internal combustion engine while there are faster, better-equipped vehicles available that run on just electric motors.

Rumor is BMW is not making a direct successor to the i8, but the automaker will likely make an all-electric sports car. Eventually. And that would change everything. With just electric motors, a BMW coupe could offer serious speed while being more friendly to the environment. A pure electric i8 could be a game changer and a legitimate speed demon.

The 2019 i8 is a lovely vehicle and could bring serious enjoyment to the right person with its easy powertrain and stunning looks.


Video Review of BMW i8 (filmed in 2015)

Tesla will not “refresh” its Model S or Model X electric vehicles

By Kirsten Korosec

Tesla owners and customers hoping for a refreshed Model S or Model X are going to be waiting indefinitely. Tesla CEO Elon Musk tweeted Monday night that there will be no “refreshed” Model X or Model S coming.

In automotive speak, refreshed typically means small revisions to a vehicle model that extend beyond the typical yearly updates made by manufacturers. A refresh is not a major redesign, although there’s often a noticeable change to the vehicle model.

The company will make minor ongoing changes to the luxury electric sedan and sport utility vehicle, Musk said. One recent example is Tesla has taken the Model 3 rear drive unit as the front drive unit in the S and X. That change went into production three months ago, Musk said in the tweet.

There is no “refreshed” Model X or Model S coming, only a series of minor ongoing changes. Most significant change in past few years was to use high efficiency Model 3 rear drive unit as S/X front drive unit. That went into production 3 months ago.

Elon Musk (@elonmusk) July 9, 2019

Musk added that the interior of the Model S and Model X will remain the same. There’s been speculation that Tesla would eventually change the X and S interiors to match the newer Model 3.

The S and X are sticking around, however. Tesla won’t discontinue either model for now, according to Musk when asked via Twitter if the company would get rid of the S and X and new release new model lines for “anticipated full self-driving capabilities.”

It’s unclear if Tesla will eventually phase out its flagship S and its complicated X, which Musk once described as an act of hubris. Neither vehicle garners as many sales as its cheaper counterpart, the Model 3. Tesla delivered 17,650 Model S and X vehicles compared to 77,550 Model 3s in the second quarter.

Elon Musk: Tesla will ‘most likely’ begin computer chip upgrades this year

By Kirsten Korosec

Tesla CEO Elon Musk said the company will “most likely” begin upgrading older electric vehicles with its new custom chip this year — a lofty task that will involve retrofitting hundreds of thousands of Model S, X and 3s.

Musk tweeted Sunday night that the upgrades will begin most likely at the end of the fourth quarter.

End of Q4, most likely

— Elon Musk (@elonmusk) July 8, 2019

Musk didn’t provide other details. He has previously said the upgrade would be free for owners who purchased the full self-driving feature, a software package that costs $6,000.

Tesla offers two different advanced driver assistance packages to customers: Autopilot and Full Self-Driving or FSD. Autopilot is ADAS that offers a combination of adaptive cruise control and lane steering and is now a standard feature on new cars. FSD includes Summon as well as Navigate on Autopilot, an active guidance system that navigates a car from a highway on-ramp to off-ramp, including interchanges and making lane changes.

While Tesla charges for the FSD software package, the vehicles are not fully autonomous. Musk has promised that the advanced driver assistance capabilities on Tesla vehicles will continue to improve until eventually reaching that full automation high-water mark.

Anyone who purchased full self-driving will get FSD computer upgrade for free. This is the only change between Autopilot HW2.5 & HW3. Going forward “HW3” will just be called FSD Computer, which is accurate. No change to vehicle sensors or wire harness needed. This is v important. https://t.co/lICMpT7xnX

— Elon Musk (@elonmusk) March 29, 2019

The custom chip unveiled in April has been couched as a necessary hardware upgrade to reach that goal. Since March, new Model X and S vehicles have come equipped with the chip. The Model 3 followed a month later.

The custom chip was a milestone for the company. However, it still faces the considerable challenge of upgrading thousands of so-called “Hardware 2” vehicles, not to mention the continuous development of the software.

Tesla started producing electric vehicles with a more robust suite of sensors, radar, and cameras — called Hardware 2— in October 2016 under the premise and the promise that it had the hardware needed to eventually drive autonomously without human intervention. At that time, the company also began selling the upgraded full self-driving package that Musk said would eventually reach that ambitious target.

Tesla’s in-dash sketchpad gets a boost in next update, music tools coming later

By Darrell Etherington

Tesla owners will be better able to express themselves artistically using their in-vehicle infotainment touchscreen with the next update of their vehicle’s in-car software. Tesla revealed via Twitter today that the forthcoming software update will bring improved Sketchpad features, providing essential upgrades to an Easter Egg it first debuted over two years ago that lets Tesla owners doodle in their cars.

In response to a request from a fan asking for Tesla’s in-car drawing software (this is a weird phrase to be writing) to add a color picker, saturation controls and an undo history, Tesla noted that new features are coming in the next big update planned for Tesla vehicle software. It sounds like all of those could be on the menu, based on this tweet, and that might not be the end of the improvements in store.

Wish granted 💫. New Sketchpad features are rolling out in our next software update.

What will you draw? 🎨https://t.co/eXUm4k24qH

— Tesla (@Tesla) June 28, 2019

In May, Tesla CEO Elon Musk responded to another Twitter fan who was requesting animation support. Musk replied just a simple ‘Ok’ but given his general meme love, I would not at all be surprised if the next version of Sketchpad supports GIF output.

Musk also noted at around the same time that “Every Tesla should have good art & music creation software” which does not actually seem like an essential accoutrement for a vehicle at all, but then again Musk is a billionaire and I am not.

The CEO also followed up with some more details on what he has in mind for music curation: A ‘little music tool’ to be released later, and even in-car karaoke.

Fun, little music tool coming later

— Elon Musk (@elonmusk) June 28, 2019

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