Tag: automotive

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Didi launches lending and insurance as new regulation threatens to lower driver numbers

Didi Chuxing, China’s dominant ride-hailing firm, is rolling out a range of financial and insurance services as it looks to fortify its service against a range of challenges in 2019.

The company announced today that it is adding “protection” insurance and credit services for both passengers and drivers who use its platform. The former is aimed particularly at Didi drivers by offering health and car insurance that it claims will “lower the entry barrier for gig economy workers and broaden the scope of protection for more families.”

These new options will appear inside the Didi app. The company isn’t saying too much about them in detail, but they were trialed in 10 cities last year. Similar services have surfaced in Southeast Asia, where Didi ally Grab and its local rival Go-Jek have built out a range of fintech services, including payments and insurance.

It’s impossible to ignore the fact that this new Didi rollout comes amid changes that could inhibit its ability to attract and retain drivers. That’s because, as we explained this week, regulations that come into effect on January 1 require drivers to hold two licenses, a local residency permit that clears them for work and a permit to operate a vehicle for commercial purposes. That’s tricky, because the residential permit is difficult to obtain, while the commercial driving license adds a cost that may see some part-time drivers decide that driving with Didi doesn’t make sense financially.

While Didi has fought back to lower the barriers by allowing divers to rent licensed cars that it sources itself — “you supply the manpower, we provide the car,” its slogan reads — these changes could spell the end of China’s gig economy, at least in terms of ride-hailing as we know it.

It’s hard to criticize the introduction of tighter driver regulation given that two Didi passengers were murdered by their drivers last year. The company claims to have instituted a major restructuring that puts the focus on passenger safety, but government intervention was inevitable and it could mean a diminished pool of drivers from which to pick. A Didi representative told TechCrunch that the company has 31 million registered drivers on the platform, but the company didn’t provide an indicator of how many are active.

Nonetheless, for those who will continue with Didi or join its fleet in 2019, this new rollout is aimed at providing some of the financial services that they miss out on by not working a “regular” full-time job. Beyond insurance and lending, it will also see Didi offer deals on “new energy vehicles” through its partners. That will cover both buying cars outright, as well as leasing, trading and acquiring on finance, the company explained.

For Didi, these introductions will likely provide a welcome revenue boost. Little is known about the company’s finances, but it is reported to have lost more than half a billion dollars in the first half of 2018, mainly on subsidies. Using its extensive reach to help finance and retail partners tap into its registered user base will create a new source of income whilst also providing benefits to those users.

Government regulation isn’t Didi’s only challenge this year, as a number of rivals have sprouted up even as Meituan — the deep-pocketed “super app” company that went public in 2018 — decided to pull away from ride-hailing due to financial concerns.

Traditional auto giants BMW and SAIC Motor — Volkswagen’s partner in China — are driving into the ride-hailing scene, while HelloBike, which just bagged significant funding from Alibaba’s Ant Financial and others, is entering, too.

These factors make 2019 an interesting year for Didi. Talk of the company going public was rife in previous years, but there seems to have been little progress made. Last year’s spin-out of its driver services business — a relatively asset-heavy unit — was tipped to be a precursor to a listing, but already Lyft and Uber have taken their first steps and Didi is reported to have stalled its efforts.

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Tesla CEO Elon Musk’s year in one chart

Three point eight.

From the first day of trading in 2018 to the last, that was the final percentage difference in Tesla’s share price. Taken on its own, the number is a modest and positive gain — and far more fruitful than automakers Ford, GM and Fiat Chrysler. It’s a number that suggests a consistent year of upwards momentum for Tesla, steady and diligent like a tugboat, even-keeled and untouched from stormy market seas.

Those two bookends of the stock market calendar — January 2 and December 31 — and the 3.8 percent gain they produced obfuscates what really happened to Tesla and CEO Elon Musk in 2018.

It wasn’t quiet. It wasn’t calm. It wasn’t constant or consistent. Tesla wasn’t a tugboat in 2018; it was a whipsaw.

The year was a dizzying ride that took Tesla shareholders and fans, critics, car owners, employees, the media and Musk himself to extreme highs and troubling lows — sometimes flip-flopping twice or more in a few days’ time.

And it was exhausting, because so much of it seemed self-inflicted and avoidable.

The chart illustrates the ups and downs of Tesla’s share price, along with specific highlights. But there were so many more.

As Tesla floundered early in the year, hamstrung by the production hell of its Model 3, Musk’s company SpaceX made history when it completed a test of its Falcon Heavy rocket, the heavy-lift orbital vehicle that can carry twice the weight of its closest competition in active operation. 

As production hell dragged on through the first quarter and into the second, Musk locked in a performance-based package that granted him $2.6 billion in stock options over 10 years. Moody’s would downgrade Tesla’s credit rating to negative from stable and Musk would make an untimely April Fool’s Day joke that the company was “bankwupt.”   

It turns out those jokes weren’t so far off.

Tesla was burning through millions of dollars a day as the company tried to solve production bottlenecks in its factory.

“Tesla really faced a severe threat of death due to the Model 3 production ramp,” Musk said in an interview with Axios in November. The company was within “single-digit weeks” of dying, he added.

Other problems emerged as Musk and his employees scrambled to solve that very real and impending existential threat to Tesla. There was the unfortunate unhinged analyst call and a spat with the National Transportation Safety Board over a fatal crash and investigation into the automaker’s semi-autonomous Autopilot system.

And then it happened. Tesla, which appeared to be in a death spiral, produced 5,000 vehicles in a week. It was a triumph. The naysayers were proven wrong; the critics were silenced; the shorts would convert!

And it was only July 1.

The rest of the year played out much the same way the first half did, just with a few new characters and twists, from the “pedo guy” episode that played out on Twitter and Musk’s “funding secured” tweet to pot-smoking, SEC investigations and earning its first profit in two years.

The last quarter of the year was marked by advancements in its Autopilot system, lawsuits and subpoenas, a new Tesla chairman, two new board members Larry Ellison and Kathleen Wilson-Thompson and further expansion into China.

Tesla’s roller coaster ride of a year was stomach-churning — or thrilling, depending on your point of view — without Musk engaging in Twitter. But his frequent use of the social media tool repeatedly pulled the company, or himself, back into an abyss of petty fights, distractions and, at its worst, potential derailments to a company in which he has invested so much of his time, money and emotion.

In 2019, with the Model 3 moving into new regions of the world and hints of other grander plans, Tesla deserves, and will need, a captain with both hands on the wheel. Elon, take the wheel.

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Tesla is keeping 44 U.S. stores open until midnight in year-end Model 3 sales push

Some Tesla employees will ring in the New Year on a sales floor this year as the automaker tries to liquidate its inventory of Model 3 sedans — and even its more expensive Model S and Model X vehicles — before the federal tax credit for EVs is cut in half.

In a list of updated hours, 44 of the stores, including locations in California, Minnesota, Nevada, New York and Ohio, are open until midnight Monday. Tesla has more than 100 stores and galleries in the United States. Calls made to several of these stores indicate these locations have a mix of Model 3 sedans available for pickup today. Sales associates didn’t provide specific numbers.

After midnight Monday, the $7,500 federal electric vehicle tax credit will drop to $3,750 for anyone buying a Tesla vehicle.

Tesla CEO Elon Musk has been using Twitter to warn of the expiring tax credit for months now. Recently, the pace of promotion has escalated as Tesla’s inventory of Model 3 vehicles in the U.S. has persisted.

The company reportedly had more than 3,300 Model 3 vehicles in inventory in the U.S. as of Sunday, according a blog post by Electrek.

Now with just hours left before the federal tax credit drops, Tesla and Musk are making a special effort to reduce the Model 3 inventory in a final sales push.

Earlier this year, Tesla hit a milestone when it delivered its 200,000th electric vehicle. The achievement was a noteworthy occasion for an automaker that didn’t exist 15 years ago. However, it also activated a countdown for the $7,500 federal tax credit offered to consumers who buy new electric vehicles.

The tax credit begins to phase out once a manufacturer has sold 200,000 qualifying vehicles in the U.S. Under these rules, Tesla customers have to take delivery of their new Model S, Model X or Model 3 by December 31.

After December 31, the federal tax credit is cut in half to $3,750 for new Tesla customers. The tax credit is reduced again after June 30 to $1,875 before disappearing altogether at the end of next year.

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FlixBus is testing VR on certain routes to Las Vegas

FlixBus, the low-cost tech-forward bus service out of Europe that launched in U.S. this year, has added a VR experience to some long-distance routes to and from Las Vegas.

For now, the FlixBus VR feature, which includes about 50 virtual reality games and travel experiences, is limited to routes from Tucson, Phoenix, Los Angeles and San Diego. And it will run for three months.

Travelers who reserve a panoramic seat on these routes will get the VR experience for free. Once on board, passengers will receive VR headset loaded with content.

The Pico Goblin 2 headsets are from Pico Interactive. Inflight VR provides the content and software updates of the VR platform. Inflight VR has experience with offering a platform to people who are traveling. The company already provides the platform for airlines and airport lounges.

If the VR feature is received well — meaning people use it, enjoy it, and don’t have ill effects like vertigo — it could stick around longer. A company spokesperson told TechCrunch that the VR experience was tested on bus routes in Spain and France and received positive feedback from customers. Flixbus also picked routes that tend to be straight and without a lot of winding roads to reduce the risk of a bad experience with the VR feature.

This VR experiment matches the company’s tech-forward and youthful approach to bus travel.

FlixBus competes with traditional bus company Greyhound with fares between U.S. cities as low as $4.99. However, it has a different business model that is more comparable to ride-hailing company Uber. FlixBus, which now operates in 28 countries, manages the ticketing, customer service, network planning, marketing and sale of its product. The driving is left to local partners, which get to keep a percentage of the ticket receipts.

These local bus partners manage the daily operations of the brightly painted FlixBuses, which are outfitted with free Wi-Fi, power outlets at every seat and complimentary onboard entertainment portal. The company launched in the U.S. in May, starting with routes across California, Arizona and Nevada.

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A year’s worth of Porsche Taycans are already reserved, mostly by Tesla owners

Porsche’s first all-electric sports car might be the most hotly anticipated vehicle of 2019. Even Tesla owners are hooked.

In a recent interview with CNET, Porsche North America president and CEO Klaus Zellmer said if everyone who has placed a deposit to pre-order the car actually buys it, the Taycan will be sold out in its first year of production.

Who are these early reservation customers? According to Zellmer, more than half have not owned or do not own a Porsche. More specifically, Zellmer said these potential customers are coming from Tesla .

The quote from CNET:

Typically, if we look at our source of business, people coming from other brands, it’s Audi, BMW, or Mercedes. The no. 1 brand now is Tesla. That’s pretty interesting, to see that people that were curious about the Tesla for very good reasons obviously don’t stop being curious.

Zellmer didn’t share any numbers or further details, however. It’s unclear how many deposits have been made or the number of Taycan vehicles Porsche will ultimately produce per year. Porsche previously planned to produce about 20,000 Taycans per year. Porsche CEO Oliver Blume told WirtschaftsWoche in November that demand for the Taycan prompted the automaker to increase production capacity without indicating by how much.

The Taycan is due to launch at the end of 2019.

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Tesla names Oracle’s Larry Ellison, Walgreens executive to board as part of SEC settlement

Tesla has added two independent directors to its board, Oracle founder, chairman and CTO Larry Ellison and Walgreens executive Kathleen Wilson-Thompson, as part of a settlement with U.S. securities regulators over CEO Elon Musk’s infamous tweets about taking the company private.

The pair joined the board as of December 27, Tesla said in an announcement early Friday morning. Kathleen Wilson-Thompson is currently executive vice president and global chief human resources officer of Walgreens Boots Alliance. She also sits on public boards at two U.S.-based manufacturing companies.

Tesla board, led by its Nominating and Corporate Governance Committee, said it considered candidates with a “wide range of skill sets” from across the globe who also hold a strong personal belief in Tesla’s mission of accelerating the world’s transition to sustainable energy.

Ellison isn’t just a Tesla “believer,” he’s also a friend and ally of Musk. Ellison came to Musk’s defense during an analyst meeting in October and disclosed that Tesla is his second-largest investment. Ellison purchased 3 million Tesla shares earlier this year.

The Oracle founder also spent $1.9 million on a microgrid energy system from Tesla in 2017 for a greenhouse farming project in Lanai, according to a regulatory filing. The farming project is part of another Ellison company called Sensei that he c-founded with friend  David Agus, an author and professor of medicine at USC.

Sensei is a new L.A.-based wellness brand that will focus first on developing hydroponic farms. Its first project involves building a hydroponic farm of undisclosed size on the Hawaiian island of Lanai, which Ellison acquired for $300 million back in 2012.  Sensei president Dan Gruneberg told TechCrunch that the farm will focus nutrition per acre, a selling point for the fruits and vegetables it plans to sell to restaurants and retailers under the brand Sensei Farms.

“In conducting a widespread search over the last few months, we sought to add independent directors with skills that would complement the current board’s experience. In Larry and Kathleen, we have added a preeminent entrepreneur and a human resources leader, both of whom have a passion for sustainable energy,” Tesla’s Board of Directors said in a prepared statement.

The appointments closes a dramatic year for Tesla and Musk, who reached a settlement with the SEC in September that included he step down as chairman of the board and pay a $20 million fine. The SEC filed a complaint earlier this year alleging that Musk lied when he tweeted on August 7 that he had “funding secured” for a private takeover of the company at $420 per share.

Musk has remained CEO and still has a seat on the board. Tesla also agreed to name two independent directors to the board.

Tesla paid a separate $20 million penalty. The SEC said the charge and fine against Tesla is for failing to require disclosure controls and procedures relating to Musk’s tweets.

Tesla’s fulfillment of the agreement with the SEC marks the beginning of a new era of corporate governance for Tesla, which some shareholders have argued is too tightly controlled by Musk and others closely aligned to him such as his brother Kimbal Musk.

In 2017, Tesla diversified its board and added James Rupert Murdoch, the CEO of Twenty-First Century Fox Inc., and Linda Johnson Rice,Chairman and CEO of Johnson Publishing Company.

Other board members include: Robyn Denholm, who joined the board in 2014, Brad W. Buss, who has been on since 2009, Antonio Gracias, and Ira Ehrenpreis, one of longest-serving board members who joined in 2007. Denholm was named Tesla chairman in October.

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Tesla names Oracle’s Larry Ellison, Walgreens executive to board as part of SEC settlement

Tesla has added two independent directors to its board, Oracle founder, chairman and CTO Larry Ellison and Walgreens executive Kathleen Wilson-Thompson, as part of a settlement with U.S. securities regulators over CEO Elon Musk’s infamous tweets about taking the company private.

The pair joined the board as of December 27, Tesla said in an announcement early Friday morning. Kathleen Wilson-Thompson is currently executive vice president and global chief human resources officer of Walgreens Boots Alliance. She also sits on public boards at two U.S.-based manufacturing companies.

Tesla board, led by its Nominating and Corporate Governance Committee, said it considered candidates with a “wide range of skill sets” from across the globe who also hold a strong personal belief in Tesla’s mission of accelerating the world’s transition to sustainable energy.

Ellison isn’t just a Tesla “believer,” he’s also a friend and ally of Musk. Ellison came to Musk’s defense during an analyst meeting in October and disclosed that Tesla is his second-largest investment. Ellison purchased 3 million Tesla shares earlier this year.

The Oracle founder also spent $1.9 million on a microgrid energy system from Tesla in 2017 for a greenhouse farming project in Lanai, according to a regulatory filing. The farming project is part of another Ellison company called Sensei that he c-founded with friend  David Agus, an author and professor of medicine at USC.

Sensei is a new L.A.-based wellness brand that will focus first on developing hydroponic farms. Its first project involves building a hydroponic farm of undisclosed size on the Hawaiian island of Lanai, which Ellison acquired for $300 million back in 2012.  Sensei president Dan Gruneberg told TechCrunch that the farm will focus nutrition per acre, a selling point for the fruits and vegetables it plans to sell to restaurants and retailers under the brand Sensei Farms.

“In conducting a widespread search over the last few months, we sought to add independent directors with skills that would complement the current board’s experience. In Larry and Kathleen, we have added a preeminent entrepreneur and a human resources leader, both of whom have a passion for sustainable energy,” Tesla’s Board of Directors said in a prepared statement.

The appointments closes a dramatic year for Tesla and Musk, who reached a settlement with the SEC in September that included he step down as chairman of the board and pay a $20 million fine. The SEC filed a complaint earlier this year alleging that Musk lied when he tweeted on August 7 that he had “funding secured” for a private takeover of the company at $420 per share.

Musk has remained CEO and still has a seat on the board. Tesla also agreed to name two independent directors to the board.

Tesla paid a separate $20 million penalty. The SEC said the charge and fine against Tesla is for failing to require disclosure controls and procedures relating to Musk’s tweets.

Tesla’s fulfillment of the agreement with the SEC marks the beginning of a new era of corporate governance for Tesla, which some shareholders have argued is too tightly controlled by Musk and others closely aligned to him such as his brother Kimbal Musk.

In 2017, Tesla diversified its board and added James Rupert Murdoch, the CEO of Twenty-First Century Fox Inc., and Linda Johnson Rice,Chairman and CEO of Johnson Publishing Company.

Other board members include: Robyn Denholm, who joined the board in 2014, Brad W. Buss, who has been on since 2009, Antonio Gracias, and Ira Ehrenpreis, one of longest-serving board members who joined in 2007. Denholm was named Tesla chairman in October.

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Grab raises fundraising target to $5B as Southeast Asia’s ride-hailing war heats up

Southeast Asian ride-hailing firm Grab is aiming to start the new year with a bang and an awful load of bucks. The company, which acquired Uber’s local business earlier this year, is planning to raise as much as $5 billion from its ongoing Series H round, up from an original target of $3 billion, a source with knowledge of the plan told TechCrunch.

Grab declined to comment for this story.

That Series H round has been open since June. Already, it has seen participation from the likes of Toyota, Microsoft, Booking Holdings and Yamaha Motors who have pushed it close to the original $3 billion target. Prior to raising $150 million from Yamaha, Grab said the round stood at $2.7 billion. While it is true that the company first announced that it was “on track to raise over $3 billion by the end of 2018,” it is not public knowledge that it has set its sights as high as $5 billion.

A big part of that expansion is a planned investment from SoftBank’s Vision Fund which, as TechCrunch reported last week, is aiming to pump up to $1.5 billion into the business. Adding that to the $3 billion total appears to leave a further $500 million allocation for other investors to take up.

Grab is already the most capitalized startup in Southeast Asia’s history having raised around $6.8 billion to date from investors, according to data from Crunchbase. The company was last valued at $11 billion — when Toyota invested the initial $1 billion in this Series H six months ago — and it is unclear how much that valuation will increase when the round is completed.

The company is also one of the widest reaching consumer internet companies in Southeast Asia, a region of 650 million consumers. Grab claims over 130 million downloads and more than 2.5 billion completed rides to date, while it has expanded into fintech and it is going beyond ride-hailing app to offer Southeast Asia a ‘super app’ in the mold of Meituan in China. On the financial side, Grab is assumed to not yet be profitable. But it has said that it made $1 billion in revenue and that it projects that the figure will double in 2019.

Buying Uber’s business made it the dominant ride-sharing operator in the region — a position that saw it pay fines in Singapore and the Philippines — but Uber’s exit also saw Go-Jek, a rival in Indonesia, step up and expand its business into new markets. Go-Jek — which is backed by the likes of Tencent, Meituan and Google — entered Vietnam in August and it has recently launched in Thailand and Singapore as it bids to step into Uber’s shadow.

With Go-Jek aiming to raise $2 billion of its own, it certainly looks like Grab’s extension of its already-enormous Series H round is aimed at increasing its war chest as the competition intensifies in post-Uber Southeast Asia.

Southeast Asia exit deal is a win, not a defeat, for Uber

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Porsche’s top-of-the-line EV to get the Turbo name and a $130,000-plus price tag

Porsche’s upcoming Taycan, which is expected to go on sale next year, will have at least three variants of the all-electric sports car, including an all-wheel drive version. But it’s the Taycan Turbo — the name Porsche is giving its top-of-the-line variant — that reveals the automaker’s strategy.

The names — the Taycan for the base model, Taycan 4S for the all-wheel drive version and Taycan Turbo for the performance variant — as well as prices ranges for each were first reported by columnist Alex Roy. As Roy notes, however, “turbo” is vocabulary used for internal combustion engine vehicles.

Porsche parent company Volkswagen Group has pledged to spend more than $1 billion developing the Taycan, which roughly translates to  “lively, young horse” in a nod to its iconic emblem.

The electric vehicle is seen (in some circles) as a threat to Tesla, which has dominated the luxury electric vehicle market. With so much investment headed toward Porsche’s first all-electric vehicle, the German automaker is smartly using nomenclature familiar to its existing customer base, many of whom have never owned an EV.

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Elon Musk argues comments on Twitter are protected speech in request to dismiss ‘pedo guy’ lawsuit

Elon Musk has filed a motion to dismiss a defamation lawsuit filed against him by the British cave rescuer who sued the billionaire entrepreneur for calling him a pedophile.

Musk’s motion presents numerous reasons to dismiss the defamation lawsuit, all of which come back to a two main points: Twitter is “infamous for invective and hyperbole,” and therefore should not be considered fact and these “imaginative attacks,” even if offensive, “are by their nature opinion and protected by the First Amendment.” 

Musk’s lawyers ask a single question in the request: “Accepting Unsworth’s well-pleaded allegations as true, would a reasonable reader believe that Musk’s statements were supported by objective facts or were instead “nonactionable opinion?”

The list of arguments laid out in the motion to dismiss are:

  1. Unsworth must prove that the reasonable reader would believe Musk possessed private facts implicating Unsworth as a pedophile.
  2. In context, Musk’s statements cannot reasonably be read as asserting underlying knowledge that Unsworth was a pedophile
  3. Statements on unmoderated Internet forums are presumptively opinion.
  4. Musk’s underlying argument is that “his over-the-top insults are not statements of fact.”
  5. Musk disclosed the basis for his personal opinion: Thailand’s documented problems with sex tourism
  6. Musk’s over-the-top insults are not statements of fact
  7. Musk’s colloquial statements are not reasonably interpreted as statements of facts
  8. Musk’s expressions of uncertainty show that his statements did not have a concrete factual foundation and were therefore opinion
  9. Readers did not interpret Musk’s statements as factual assertions

Whether these arguments will be enough to convince a judge to dismiss the lawsuit is unclear. However, it raises a different question. If the argument is to be believed, it would suggest that other claims and promises Musk puts on Twitter shouldn’t be trusted as fact either.

The whole “pedo guy” episode began over the summer after Musk and employees at his companies, SpaceX, Tesla, and The Boring Company, became involved in an effort to extract 12 boys and their soccer coach from the Tham Luang Nang Non cave system located in Northern Thailand after flooding trapped the group for weeks. Musk’s team developed and then sent  mini submarine built out of rocket parts that he thought could help.

The team of divers who eventually rescued every person trapped in the cave didn’t use the mini-submarine, dubbed by Musk’s people as “Wild Boar.”

Unsworth, a British ex-pat who lives in Thailand, helped plan the rescue operation and recruited other cave diving experts. The fight began after Unsworth gave an interview on CNN International, in which he called the mini submarine a “PR stunt,” that it “had absolutely no chance of working” and that Musk could “stick his submarine where it hurts.”

Musk subsequently lashed out on Twitter and insinuated that Unsworth was a pedophile. He later deleted the offending tweet and tried to backpedal — even offering an apology of sorts on Twitter. And it could have all ended there. But then Musk dug it all up again during a debate with ex-TechCrunch journalist Drew Olanoff — once again on Twitter. Olanoff had brought up the “pedo guy” attack as an example of Musk telling untruths.

Unsworth filed a lawsuit September in the U.S. District Court for the Central District of California against Musk for defamation. The lawsuit alleges that between July 15 and August 30, Musk periodically used Twitter and emails to the media to publish false and defamatory accusations against Unsworth, including accusations of pedophilia and child rape.

Read the entire motion here.