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| Hi Insiders, In today's transportation newsletter, we cover Tesla's price reductions in China, Canoo reporting earnings surpassing expectations, and Ford enlisting an Apple executive to spearhead its software program. If you find this newsletter useful, please share it with your friends and colleagues. Thank you! Robel
p/Robel-Kelkile | |
| 1 | | Electric vehicle manufacturer Canoo reported a narrower-than-anticipated quarterly loss due to reduced research and development costs, resulting in a 2% rise in its shares during extended trading. The company introduced its new lifestyle delivery vehicle 190, boasting increased payload capacity and body length compared to the original lifestyle delivery vehicle 130. More: - Canoo's Q2 loss decreased to $70.9M from $164.4M a year ago, with adjusted losses per share at 14 cents, surpassing the estimated loss of 19 cents, according to Refinitiv data.
- With research and development expenses dropping by about 67% in the quarter.
- Despite its strategic entry into the EV market, Canoo expressed concerns about its operational viability for the next twelve months holding cash equivalents of $5M by June 30.
- The company foresees a capital expenditure range of $70M to $100M in the latter half of 2023 while maintaining contracts with the U.S. Defense Department, Walmart, and NASA for EV supply and advanced battery packs.
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| 2 | | Tesla has reduced prices for its Model Y long-range and performance versions in China starting from Aug. 14, causing concerns about potential impacts on profit margins, resulting in a 2.7% drop in company shares. This move follows a 31% sales decline for Tesla's China-made vehicles in July, prompting the company to offer insurance subsidies and potentially indicating future price cuts in the U.S. and Europe. More: - Model Y Long Range's price decreased by 4.5% to 299,900 yuan (approximately $41,000), and the Model Y Performance's price is down by 3.8% to 349,900 yuan.
- Tesla also introduced insurance subsidies of 8,000 yuan in China for buyers of the entry-level, rear-wheel-drive versions of Model 3 vehicles.
Why it matters: - Despite the price reductions, Tesla's CEO Elon Musk has hinted at the possibility of further price cuts, even if they impact the company's margins.
- The company has previously lowered prices in various markets and offered incentives to manage inventory, combat competition, and navigate economic uncertainty.
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| 3 | | Ford has appointed former Apple executive Peter Stern to lead its newly established Ford Integrated Services unit, responsible for developing and marketing software-driven customer experiences across Ford's various business units. The move comes as Ford seeks to bridge the gap in its EV business revenue by focusing on software-driven solutions and personalized driver experiences. More: - The unit will create and promote software-based customer experiences across Ford's three business divisions: Ford Blue for gas and hybrid vehicles, Model E for connected EVs, and Ford Pro for commercial products.
- Ford aims to enhance the driver experience, integrate hardware and software, and establish new revenue streams in the era of software-defined vehicles.
- The new unit will work on advancing technologies like Ford's BlueCruise "hands-free" highway driver assistance system, commercial solutions for fleet management, telematics, and EV charging.
- Ford reports having 550,000 paid software and services subscribers, with a majority (80%) of Ford Pro customers.
Why it matters: - Stern will also oversee Ford Next, the automaker's global venture studio, following the departure of its former CEO, Franck Louis-Victor, after legal issues.
- Stern's background includes serving as Apple's vice president of services and leading the launches of services like Apple TV+, Apple News+, and Apple Fitness+.
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| 4 | | Robomart, the Los Angeles-based self-driving store company, announced a $2M seed round. The round was led by W Ventures with additional venture support from Wasabi Ventures, SOSV/HAX, and Hustle Fund. More: - The funding coincides with the launch of Robomart's new product, the Haven model, which complements its existing Oasis model.
- The Haven vehicle provides customizable branding options (similar to a car wrap) and can accommodate around 300 product SKUs (stock-keeping units).
- Robomart's concept revolves around "store-hailing," where a self-driving vehicle brings a selection of store items directly to consumers, akin to ride-hailing services but for retail.
- The company, which has raised $3.4M in funding to date, is set to begin deliveries in 2025 with the hope of revolutionizing how consumers shop for daily essentials.
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| 5 | | The French government plans to allocate €100M for expanding and enhancing its rail sector, funded through an increased tax on airline tickets, aligning with its strategy to prioritize domestic train travel over air travel for environmental reasons. This move comes after France's ban on short-haul flights under 2.5 hours. More: - The transport minister, Clément Beaune, acknowledged the price discrepancy between plane and train travel, proposing that the increased tax would affect business and higher-cost airfares, fostering affordability for train travel.
- The effort is part of a broader strategy to address carbon emissions across sectors, with plans to introduce a kerosene tax in Europe, pending consensus from all member states.
Why it matters: - European countries invest heavily in cross-border rail networks, but challenges persist due to variations in track sizes, platforms, and voltages across regions.
- This initiative aligns with the broader trend in many European countries, including Germany and Spain, to promote and expand train routes as a preferred option for consumers, encouraging sustainable travel choices over flying.
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| 6 | | Rocket Lab has been chosen to launch two small satellites for NASA's PREFIRE (Polar Radiant Energy in the Far-InfraRed Experiment) mission to collect data on far-infrared energy emissions from Earth's poles to improve climate models. The miniaturized satellites equipped with thermal IR spectrometers are scheduled for launch in May 2024. More: - These launches, part of NASA's Venture-class Acquisition of a Dedicated Rideshare program, mark the seventh and eighth NASA missions conducted by Rocket Lab since 2018.
- Rocket Lab's Electron rocket's unique capability to deploy dedicated small satellite missions efficiently allows it to meet the specific requirements of this venture, resulting in these rapid-succession launches.
Why it matters: - Amidst rising temperatures, the endeavor could assist scientists in gaining a more comprehensive understanding of how a warming climate might impact the immense ice shelves at Earth's polar regions.
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| 7 | | Quick Hits: - The AWS Cookbook — packed with practical insights and hands-on examples — is a must-have for your cloud toolkit.*
- Ford announced that it is further embracing the software realm by incorporating its hands-free driving hardware, known as BlueCruise, as a standard feature in numerous upcoming vehicles, signifying the continued shift towards a Tesla-like approach for the Detroit automaker.
- A Chinese auto parts supplier has chosen Fort Worth as the location for its new research and development center, which will bolster electric vehicle manufacturing efforts.
- Faraday Future announced the delivery of its FF 91 EV, initially planned for 2018, in a ceremony for Futurist Alliance "spire users" on Aug. 12.
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Term of the Day Common area maintenance (CAM): CAM includes the fees tenants must pay to cover the expenses associated with the maintenance and operation of the common areas. Question of the Week Do you share details about your salary with your coworkers? Join the conversation |
INSIDE TRANSPORTATION LEADERBOARD (ALL-TIME) |
 | Writer | | Born and raised in the Bay Area, Robel is passionate about all things tech, venture, and financial education. He has previously served both universities and state governments in their engagement strategy and tracking legislation. | | This newsletter was edited by Aaron Crutchfield | |
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