Tag: Tennessee

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Ford teases a second electric pickup truck

Ford will build a second EV truck, CEO Jim Farley said Tuesday during the automaker’s splashy event to celebrate the production launch of the electric F-150 Lightning truck.

The F-150 Lightning is a full-size truck and the third EV in Ford’s battery-electric lineup following the Mustang Mach E and the commercial E-Transit van. Farley didn’t provide further details on the new model, but said that it will be built at Ford’s new $5.6 billion BlueOval City manufacturing complex in Stanton, Tennessee. Considering that the F-150 is a full-size truck, it’s likely the new model will be a mid-size version.

Farley said that Ford aims to build and sell 600,000 EVs worldwide by the end of 2023 and more than 2 million annually by 2026.

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3 predictions for GM’s Q1 earnings

General Motors is set on going electric, if its $35 billion investment to launch 30 new EVs globally over the next three years is anything to go by.

But the automaker, which will report its first-quarter financial results on Wednesday, is expected to face increasing competition from both legacy automakers and newcomers in the U.S. and internationally. The investment is part of GM’s effort to keep up with competitors such as Volkswagen, which, as the world’s largest automaker, is investing $100 billion to electrify its portfolio.

Meanwhile, materials shortages and supply chain delays have put a crimp in the automotive business lately, affecting availability and pricing, and leaving the near-term future of EVs in question. Overall, GM’s U.S. sales fell 20.4% in the first quarter, which is in line with results reported by most major car companies. Nearly all of its nameplates suffered losses due to supply shortages and consumer interest.

What analysts and TechCrunch will look for

Per data from Yahoo Finance, analysts expect GM to report profit of $1.68 per share on revenue of $37.33 billion in Q1 2022. GM reported a profit of $2.06 per share on revenue of $32.47 billion a year earlier.

EVs

GM set a goal to sell more than 1 million EVs in North America by the end of 2025, but materials shortages, supply chain issues, and the resulting slowdown in production could prove to be big hurdles. So we’ll be paying particular attention to updates on production runs and supply chain forecasts.

Despite industry-wide uncertainty, GM seems well-positioned to scale battery-electric models by the tens of thousands using its modular Ultium battery platform. The Ultium technology could be a key advantage in helping GM commercialize EVs, as could a partnership with Honda to co-develop, scale and sell electric vehicles by 2027.

So far, early consumer demand for its latest battery-electric models, a six-figure Hummer EV, and a $60,000 Cadillac Lyriq crossover, seems encouraging. In March, GM’s luxury brand, Cadillac, said widespread interest in its first-ever EV prompted it to boost production to 25,000 units this year, up from the 3,200 units previously projected.

But competition in the EV segment is expected to intensify worldwide, especially in China, a key market for GM and most automakers. So we’re interested in hearing GM’s thoughts on keeping competitive as established and startup automakers alike begin flooding the market with scores of new nameplates.

Battery and EV assembly

GM has consistently invested in expanding its battery cell and EV assembly over the past couple of years to control more of its supply chain. Recently, the carmaker said it would invest more than $7 billion in four Michigan factories focused on battery cell and electric truck manufacturing, including a third plant with partner LG Energy Solutions. That means we can expect guidance on when those plants will open and if the timeline remains on track.

The automaker spent $2 billion readying its Spring Hill, Tennessee, manufacturing complex – its largest in North America – to build the Lyriq and other EVs. A $2.6 billion cell factory in Lansing, Michigan, will follow in late 2024. We will also be listening for more details on GM’s forthcoming Ultium battery plant in Lordstown, Ohio.

Subsidiaries

GM is likely to provide updates on Cruise, its autonomous vehicle subsidiary, and BrightDrop, its commercial electric vehicle concern.

Last month, GM bought out Softbank’s stake in Cruise for $2.1 billion, and made an additional $1.35 billion investment in the company, bringing its ownership to 80%. GM might share details on this deal and perhaps confirm or dispel any rumors that the automaker is planning to spin out Cruise to pursue an IPO.

That might be too juicy to share at an earnings call, but it’s safe to assume we’ll hear some updates for Cruise. The company launched a limited driverless robotaxi service in San Francisco a few months ago, and we’re eagerly awaiting news that Cruise has secured the required permit from the California Public Utilities Commission to start actually charging for its rides.

Last October, Cruise said it would be in “a couple of major cities in the United States” over the next few years, so GM might also share updates for plans to expand into new cities. Finally, the Cruise Origin, the company’s purpose-built AV, might get a mention, too. Mass production at GM’s Factory ZERO assembly plant is slated to begin next year, but with the world’s ongoing supply chain woes, who knows?

Meanwhile, BrightDrop recently scored Walmart as a customer with a reservation for 5,000 e-delivery vans. FedEx also upped its reservation of vans to 2,000 from 500, and might add 20,000 more EVs to that order in coming years. Walmart is expecting a combo of EV600s and smaller EV410s by 2023, so look out for updated guidance on production and delivery dates for BrightDrop’s EVs, as well as announcements of possible other commercial customers.

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Cadillac begins production of Lyriq crossovers, the GM luxury brand’s first EV

Cadillac began production on Monday of its first-ever electric vehicle, the $60,000 Lyriq crossover.

General Motors’ luxury brand has high hopes for the SUV as the first model in the battery-electric portfolio it plans to roll out by 2030. Demand for the car, which goes on sale in May, prompted Cadillac to boost production to 25,000 units this year, up from the 3,200 units previously projected, and launch nine months early.

That’s an encouraging sign for GM, which said it will spend $35 billion toward launching 30 new EVs globally over the next three years. The automaker spent $2 billion readying its Spring Hill, Tennessee, manufacturing complex – the automaker’s largest in North America – to build the Lyriq and other EVs.

The investment is part of GM’s overall strategy to compete with behemoths including Tesla and Volkswagen, which is spending $100 billion toward electrifying its portfolio. A supply chain crunch for semiconductors and batteries has hampered EV production globally.

GM’s forthcoming models will be based on the Ultium battery platform that underpins the Lyriq and its other EVs. Its modular architecture, which can produce 19 different battery and drive configurations, will help GM scale its battery-electric operations and reduce costs.

In addition to the Lyriq, the Spring Hill plant makes gas-engine SUVs including the Cadillac XT5 and XT6 and GMC Acadia. GM President Mark Reuss said in a briefing call with media on Monday that the factory will add more EVs to its assembly lines but declined to comment on when or whether the plant will produce EVs only.

“We have the flexibility to go both ways,” Reuss said. “We’re in the perfect spot. We can build internal combustion engines, we can build EVs, and we can follow the market.”

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Google faces a major multi-state antitrust lawsuit over Google Play fees

A group of 37 attorneys general filed a second major multi-state antitrust lawsuit against Google Wednesday, accusing the company of abusing its market power to stifle competitors and forcing consumers into in-app payments that grant the company a hefty cut.

New York Attorney General Letitia James is co-leading the suit alongside with the Tennessee, North Carolina and Utah attorneys general. The bipartisan coalition represents 36 U.S. states, including California, Florida, Massachusetts, New Jersey, New Hampshire, Colorado and Washington, as well as the District of Columbia.

“Through its illegal conduct, the company has ensured that hundreds of millions of Android users turn to Google, and only Google, for the millions of applications they may choose to download to their phones and tablets,” James said in a press release. “Worse yet, Google is squeezing the lifeblood out of millions of small businesses that are only seeking to compete.”

In December, 35 states filed a separate antitrust suit against Google, alleging that the company engaged in illegal behavior to maintain a monopoly on the search business. The Justice Department filed its own antitrust case focused on search last October.

Google slammed for ‘monopoly power’ in new antitrust lawsuit from 35 states

In the new lawsuit, embedded below, the bipartisan coalition of states allege that Google uses “misleading” security warnings to keep consumers and developers within its walled app garden, the Google Play store. But the fees that Google collects from Android app developers are likely the meat of the case.

“Not only has Google acted unlawfully to block potential rivals from competing with its Google Play Store, it has profited by improperly locking app developers and consumers into its own payment processing system and then charging high fees,” District of Columbia Attorney General Karl Racine said.

Like Apple, Google herds all app payment processing into its own service, Google Play Billing, and reaps the rewards: a 30 percent cut of all payments. Much of the criticism here is a case that could — and likely will — be made against Apple, which exerts even more control over its own app ecosystem. Google doesn’t have an iMessage equivalent exclusive app that keeps users locked in in quite the same way.

While the lawsuit discusses Google’s “monopoly power” in the app marketplace, the elephant in the room is Apple — Google’s thriving direct competitor in the mobile software space. The lawsuit argues that consumers face pressure to stay locked into the Android ecosystem, but on the Android side at least, much of that is ultimately familiarity and sunk costs. The argument on the Apple side of the equation here is likely much stronger.

The din over tech giants squeezing app developers with high mobile payment fees is just getting louder. The new multi-state lawsuit is the latest beat, but the topic has been white hot since Epic took Apple to court over its desire to bypass Apple’s fees by accepting mobile payments outside the App Store. When Epic set up a workaround, Apple kicked it out of the App Store and Epic Games v. Apple was born.

The Justice Department is reportedly already interested in Apple’s own app store practices, along with many state AGs who could launch a separate suit against the company at any time.

Apple terminates Epic Games’ App Store account

Tim Cook plays innocent in Epic v Apple’s culminating testimony

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GM, LG Chem studying the feasibility of a second battery cell plant in the U.S.

General Motors is exploring building a second U.S. battery cell manufacturing plant with its joint-venture partner Seoul, South Korea-based LG Chem.

If the plant moves forward, it would be the latest in a series of investments aimed at building out the auto giant’s portfolio of electric vehicles. The company’s joint venture with LG, Ultium Cells LLC, is already at work constructing a $2.3 billion battery cell manufacturing facility in Lordstown, Ohio.

The companies hope to have a decision on the factory in the first half of 2021, GM spokesman Dan Flores told TechCrunch. He declined to specify possible locations for the site but Tennessee is high on the list, according to reporting from the Wall Street Journal.

GM has set ambitious targets for decarbonizing its operations and pledged steep investments to get there. Through 2025 alone the company said it would bring thirty EV models across its brands to the global market and spend $27 billion on electrification and automated technology—a 35% increase from 2020 spending. By the mid-2030s, GM said its fleet will be all-EV.

“Clearly, with our commitment to an all-electric future, we will need a lot of battery cells,” Flores said.

He declined to comment on the ongoing shortage of battery cells, which has affected EV manufacturers Tesla and Nikola. President Joe Biden issued an executive order at the end of February instructing federal agencies to identify risks in the supply chains for batteries, semiconductors, and other critical items, including where supply chains are dependent on “competitor nations.”

GM CEO Mary Barra said in a virtual investor presentation last week that the battery shortage is one reason the company is investing in its own battery cell manufacturing. She alluded to plans to grow the company’s battery cell manufacturing operations but did not go into specifics.

“There’s more coming than we’ve announced already,” she said.

GM starts construction on the cornerstone of its EV strategy

Early Stage is the premier ‘how-to’ event for startup entrepreneurs and investors. You’ll hear first-hand how some of the most successful founders and VCs build their businesses, raise money and manage their portfolios. We’ll cover every aspect of company-building: Fundraising, recruiting, sales, product market fit, PR, marketing and brand building. Each session also has audience participation built-in – there’s ample time included for audience questions and discussion.

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12 ‘flexible VCs’ who operate where equity meets revenue share

David Teten Contributor
David Teten is founder of Versatile VC and writes periodically at teten.com and @dteten.
More posts by this contributor
Jamie Finney Contributor
Jamie Finney is a founding partner at Greater Colorado Venture Fund, where he blogs about his work on VC and small communities.

Previously, we introduced the concept of flexible VC: structures that allow founders to access immediate risk capital while preserving exit and ownership optionality. We list here all the active flexible VCs we have identified, broken into these categories:

  • Revenue-based
  • Compensation-based
  • Blended-return streams

Revenue-based flexible VCs

These investors are paid back primarily based on a percentage of revenues.

Capacity Capital

Chattanooga, TN-based Capacity Capital was launched in 2020 with a primary focus on the southeastern U.S. Jonathan Bragdon, its CEO, describes Capacity as “a team of founders-turned-funders making non-dilutive, founder-aligned investments of $50,000-$300,000 in post-startup, post-revenue businesses planning to 2x revenues in 12-24 months. Investments are typically in exchange for a capped, single-digit revenue share and a right to equity under certain circumstances.

If the company sells or raises enough capital, the investment converts into an agreed-upon percentage of equity. If the company grows without raising additional equity funding, founders redeem most of the equity right, based on a pre-agreed return amount. With a portfolio that includes food, tech and services, the fund is industry-agnostic and focused on the overlooked and underrepresented with high-margin business models.”

Jonathan sometimes refers to their investments as “micro-mezzanine” because “mezz is typically structured as a contractual periodic payment, with some equity-like upside, but subordinate to other debt … so most lenders look at it like equity. But, it is typically shorter term with fewer control mechanisms than equity (i.e., not VC). I wanted [a term for] something similar (between debt and equity) but on an extremely small scale.”

In addition to a fund, the overall Capacity organization provides direct mentorship, consulting and connects founders to a broad network of talent, diverse forms of capital and existing resources focused on the post-startup stage of growth. The founders, LPs and venture partners have a long history in local startup ecosystems in the Southeast including LaunchTN, The Company Lab, CO.STARTERS and several other regional funds and resources.

Flexible VC: A new model for startups targeting profitability

Greater Colorado Venture Fund

Greater Colorado Venture Fund (GCVF) is a $17 million seed fund that invests in high-growth startups in rural Colorado using equity and flexible VC structuring.

A typical GCVF flexible VC investment is $100,000-$250,000 for up to 10% ownership, of which 9% is redeemable, with a sub-10% revenue share and 12-month-plus holiday period. GCVF specializes in providing critical support to founders based in small communities, while connecting them to an unfair network well-beyond their small-town headquarters.

GCVF is pioneering the future of venture capital and high-growth startups for all small communities. With Colorado as an ideal pilot community, the GCVF team (which includes Jamie Finney, a co-author of this article) has helped grow multiple staple initiatives in the rural Colorado startup ecosystem, including West Slope Startup Week, Telluride Venture Accelerator, Startup Colorado, Energize Colorado Gap Fund and the Greater Colorado Pitch Series.

Recognizing the need for creative investment structures in their Colorado market, they co-founded the Alternative Capital Summit, creating the first community of flexible VCs and alternative startup investors.

They share their learnings on flexible VC and pioneering rural startup ecosystems on the GCVF blog.

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Major automakers Toyota, Honda, FCA extend factory closures

Toyota, Honda and Fiat Chrysler Automobiles will not reopen North American factories at the end of the month as planned as the COVID-19 disease spreads and dampens demand for new cars, trucks and SUVs.

FCA said Thursday that plants across the U.S. and Canada, as well as headquarters operations and construction projects, are intended to remain closed until April 14, dependent upon the various states’ stay-in-place orders and the readiness of each facility to return to production.

FCA’s Mopar Parts Distribution centers, which have been deemed essential to keeping first responders and commercial vehicles on the road, will continue to operate with paid volunteers. The status of production for FCA’s Mexico operations will be subject to a separate announcement, the company said in a statement emailed Thursday.

Meanwhile, Ford, Toyota and Honda also announced plans to extend closures. Ford will also said it will extend its closure until April 7.

Honda also said will keep all of its automobile, engine and transmission plants in the U.S. and Canada closed into the first week of April. Operations will resume on April 7, Honda said.

“This extension is in response to the continued steep decline in market demand across the automotive industry due to the impact of the COVID-19 pandemic on the economy, resulting in the inability of consumers in many markets to purchase new vehicles,” Honda said in an emailed statement. “As the market impact of the fast-changing COVID-19 situation continues to evolve, Honda will evaluate conditions and make additional adjustments as necessary. In undertaking this production adjustment, Honda is continuing to manage its business carefully through a measured approach to sales that aligns production with market demand.”

Toyota said its manufacturing facilities will remain closed through April 17 and will resume production on April 20. Toyota has numerous factories in North America, including Alabama, Indiana, Kentucky, Missouri, Tennessee, Texas and Baja California, Mexico and Guanajuato, Mexico.

Toyota said its service parts depots and vehicle logistics centers will continue to operate.

Earlier this month, major automakers suspended productions at factories across the U.S., Mexico and Canada. Most had planned to restart March 31. Now as that date gets closer, a number of automakers are pushing back plans to restart production.

COVID-19, the disease caused by coronavirus, has caused upheaval across every major industry as governments issue stay-at-home orders or directives for nonessential businesses to close in an effort to slow the spread of the pandemic. Closures first hit China, where the first cases of COVID-19 popped up three months. Those factories are now coming back online as plants in Europe and North America shut down temporarily.

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Men’s at-home health startup Vault takes in $30 million from Tiger Global

Vault, an at-home healthcare practice specializing men’s medicine has announced the raise of $30 million in funding from Tiger Capital Group, Declaration Capital and Redesign Health to reach more potential patients and expand to more areas beyond New York, Florida, Tennessee and Texas, where it currently offers treatments.

Founder and CEO Jason Feldman, who formerly headed Amazon’s Prime Video Direct and Global Innovation teams before launching Vault last summer, told TechCrunch his startup aims to bring specialized medicine into men’s homes to give them “a better body, better sex and a better brain.”

He tells TechCrunch he started the company after noticing how many of his male friends seemed embarrassed about medical conditions or simply didn’t know they could do something about it.

Vault operates on the assumption men face certain barriers to going to the doctor for things like hormonal imbalance and erectile dysfunction. The startup tries to remove these barriers by making it easy to book at-home appointments and get a work-up with a nurse practitioner.

“I want to de-stigmatize men’s health.” Feldman told TechCrunch. “You tell a guy to go see the doctor about his heart health and he likely won’t but you tell him you’ll bring him a doctor to help his penis and it’s a different story.”

Like many new concierge medical services that have popped up in the last few years, Vault does not take insurance, instead signing patients up via membership for $133 to $300 per month, depending on the type of service you sign up for. Compare that to Forward, which caters to both men and women and offers unlimited in-office visits and testing for $149/month or Roman, a men’s “digital clinic,” which offers free online evaluations, $15 doctor’s visits and prescription medications for similar services to Vault like erectile dysfunction, hair loss and testosterone support — although Roman requires patients see a physical doctor of their choosing within the last three years before they’re able to get prescriptions via digital services.

But Feldman doesn’t think his startup is anything like what’s out there right now, claiming it as the first national men’s healthcare provider. Vault offers specialty packages like testosterone therapy or the “sex kit” for an increased sex drive or stronger erections, something that sometimes diminishes as men age.

So far, Feldman has signed up over 500 medical practitioners to come to various home locations and has hired a chief medical officer to ensure medical standards are being met. He now plans to use the new funding to open up operations in 42 cities across the U.S. and work on spreading the word to all men nationwide that Vault is here for them.

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For alternative meat manufacturer Beyond Meat, fast food chains giveth and taketh away

Beyond Meat, the publicly traded producer of plant-based protein replacements for meat, is currently giving other companies in the alternative meat space an education in just how finicky appealing to consumer tastes can be.

On the same day that the Canadian Tim Horton’s restaurant chain is dropping Beyond Meat products from its menus, the company and fried chicken chain KFC announced the expansion of a pilot run of the company’s chicken replacement products at new stores in Nashville, Tenn., Charlotte, N.C., and across Kentucky, according to multiple reports.

KFC had originally launched a one-day test to gauge consumer demand at a location in Atlanta last August.

Kentucky Fried Chicken goes beyond chicken in partnership with Beyond Meat

On Wednesday, Beyond Meat said that 66 restaurants will receive chicken products and chief executive Ethan Brown told Yahoo Finance that he expects his company to have enough capacity to potentially meet demand from all of KFC’s locations.

“We do everything we can to keep the Colonel proud. I think the Colonel would be very proud on what we are doing here with Beyond fried chicken,” KFC U.S. CMO Andrea Zahumensky told Yahoo Finance.

KFC gets more plant-based meat from Beyond Meat.

Despite the good news, investors would be wise to not count their chickens before they hatch (or are formed into chicken-like approximations from pea protein and a mix of other ingredients).

The restaurant chain Tim Hortons is actually pulling Beyond Meat from its stores at the same time as sales are slowing for Burger King’s Impossible Whopper from Beyond Meat rival Impossible Foods.

Taken together, the reports may point to a slowdown in consumer interest for meat replacements at fast food chains.

Still, even as the Tim Hortons door closes, other doors are opening at dining establishments willing to welcome the Beyond Burger onto broader menus. On Monday, Denny’s became the latest chain to offer a Beyond Meat burger at all of its locations.

With the latest partnership, the company seems to be pulling away from its other well-capitalized rival Impossible Foods, despite the decision to scrap the company’s menu items

Beyond Meat’s ability to manufacture at scale seems to have been one of the deciding factors in the company’s partnership with McDonald’s, something that Impossible Foods chief executive, Pat Brown, referenced in an interview with Reuters earlier this month.

Denny’s launched its Beyond Burger in restaurants across Los Angeles last year and will now take the menu item to more than 1,700 locations across the U.S.

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FedEx robots sent packing by NYC

FedEx’s autonomous delivery bot got a cold reception from New York City officials.

After the company’s SameDay Bots — named Roxo — popped up on New York City streets last week, Mayor Bill de Blasio and transportation officials delivered a sharp response: Get out.

FedEx told TechCrunch that the bots were there for a preview party for its Small Business Saturday event and are not testing in New York. Even this promotional event was too much for city officials concerned with congestion and bots taking jobs from humans.

After reports of the bot sightings, the mayor tweeted that FedEx didn’t receive permission to deploy the robots; he also criticized the company for using a bot to perform a task that a New Yorker could do. The New York Department of Transportation has sent FedEx a cease-and-desist order to stop operations the bots,  which TechCrunch has viewed.

The letter informs FedEx that its bots violate several vehicle and traffic laws, including that motor vehicles are prohibited on sidewalks. Vehicles that receive approval to operate on sidewalks must receive a special exemption and be registered. 

FedEx has been experimenting with autonomous delivery bots. Postmates and Amazon also have been testing autonomous delivery robots.

FedEx first unveiled its SameDay Bot in February 2019. The company said at the time it planned to work with AutoZone, Lowe’s, Pizza Hut,  Target, Walgreens and Walmart to figure out how autonomous robots might fit into its delivery business. The idea was for FedEx to provide a way for retailers to accept orders from nearby customers and deliver them by bot directly to customers’ homes or businesses the same day.

FedEx said its initials test would involve deliveries between selected FedEx Office locations. Ultimately, the FedEx bot will complement the FedEx SameDay City service, which operates in 32 markets and 1,900 cities.

The company has tested the bots in Memphis, Tennessee as well as Plano and Frisco, Texas and Manchester, New Hampshire, according to a spokesperson.

The underlying roots of the SameDay Bot is the iBot. The FedEx bot was developed in collaboration with DEKA Development & Research Corp. and its founder Dean Kamen who invented the Segway  and iBot wheelchair.

DEKA built upon the power base of the iBot, an FDA-approved mobility device for the disabled population, to develop FedEx’s product.

The FedEx bot is equipped with sensing technology such as LiDAR and multiple cameras, which when combined with machine learning algorithms should allow the device to detect and avoid obstacles and plot a safe path, all while following the rules of the road (or sidewalk).