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Watch: Tesla's Cybertruck recall, layoffs set the stage for its Q1 earnings | TechCrunch

April 22, 2024 10:12 PM0


Tesla is not having a good start to the week. In its defense, it didn’t have a very good end to last week, either.

Today the news is that recent price cuts have irked Tesla investors, who sent its shares off around 4% in early trading today. Those losses have extended Tesla’s total share-price declines to around 43% for the year. Which is, as they say, a lot.

But those price cuts are hardly the only issues needling the U.S.-based EV company. Tesla’s last week saw the company slash its staffing, including high-performers. With the company reporting earnings tomorrow, its actions at the moment are under even greater scrutiny than usual.

The backdrop to all of this is the company’s apparent move away from a basement-priced EV, and towards a robotaxi effort that some consider to be technologically premature. Regardless, Tesla’s price cuts, pivots, and mass-recall of its Cybertruck vehicle are not the recipe for content investors. Hit play, and let’s have some fun.

After we recorded this clip, Bloomberg posted a fascinating dig into the company’s current form that we recommend as further reading.


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Tesla risks losing its lead without an inexpensive EV | TechCrunch

April 18, 2024 12:42 PM0


Elon Musk’s decision to green-light a robotaxi over an affordable EV might cost the company its lead.

Last week, Musk reportedly canned the effort in favor of a robotaxi, the sort of pie-in-the-sky project that defined his first decade at the helm. There’s an argument to be made that the company is where it is today by betting big, then delivering on enough of its promises to impress shareholders and generate significant positive cashflow. Problem is, in the early days, there was both everything and nothing to lose. The whole company could have gone under, but there was also less on the line.

Today, Tesla is no longer the plucky upstart. It brought in nearly $100 billion in revenue last year and earned net profits of $15 billion, the sort that would have other automakers rewarding shareholders with richer dividends. It’s a global manufacturer that cranks out hundreds of thousands of cars every quarter, the type of operation where success is measured in continuous improvement in productivity and process indicators.

Tesla was reportedly on the cusp of building a $25,000 EV. In January, Musk confirmed that the company would begin construction of a next-generation vehicle at its Texas plant in the second half of 2025. Suppliers had been asked to bid on parts contracts, Reuters reported, with weekly production volume starting at 10,000 vehicles per week. Given flagging sales of the company’s existing product line, it would have been a welcome shot in the arm.

An inexpensive EV would have significantly increased Tesla’s total addressable market by dramatically undercutting the average sales price in the U.S., which is currently at around $47,000. It also would have given the company a product to hold its ground against a predicted onslaught of inexpensive Chinese EVs.

But it also would have meant creating a production line from scratch, something the company last did at scale with the Model 3. By all accounts, that wasn’t a fun experience.

Building a robotaxi, though. Now, that sounds like fun.

Musk has long been enamored with the concept. Four years ago, he said that such a car would be able to earn its owner up to $30,000 per year as it ferried paying passengers to and fro. It would be so popular, Musk reportedly told biographer Walter Isaacson, that “there is no amount that we could possibly build that will be enough.”

Problem is, Tesla has been trying to master autonomous hardware and software for a while now, and it doesn’t appear anywhere close to delivering a vehicle capable of Level 5 driving, which would require zero human input. Despite years of work, Autopilot remains a Level 2 system, which means it requires human attention at all times. The same is true for Full Self-Driving. (Indeed, the company recently started using the term “supervised” when referring to the software suite.) And while artificial intelligence has been advancing rapidly of late, is it moving quickly enough to provide Tesla with a blockbuster product in the next few years?

Given Musk’s desire to pursue exploratory projects, the logical path would be to spin up a skunkworks inside Tesla or spin out a division that’s purely focused on bringing a robotaxi to market. The latter is unlikely to happen because much of Musk’s wealth is tied up in Tesla stock, and he probably doesn’t trust anyone else to run the company when that much money is on the line. The former has more of a chance, but Musk also likes to appear heavily involved in, well, everything at Tesla. He’d balk at the idea of “only” running a skunkworks.

It’s something that Tesla’s board should probably be weighing in on. And maybe they are. But numerous reports have also illustrated just how tightly linked that board is with Musk. They don’t appear to disagree on much, and that could cost Tesla its lead.


Software Development in Sri Lanka

Robotic Automations

Watch: Why Tesla’s big layoffs happened, and what comes next

April 17, 2024 5:38 AM0


Tesla’s layoffs and executive departures took a bite out of its share price this week. The well-known electric vehicle company shed around 10% of its staff, impacting an estimated 14,000 people or more. Two well-known executives also decided it was time to move on.

In response to the news, shares of Tesla lost ground. The company’s value has eroded this year, falling 35% through the end of trading yesterday.

The year has not been kind to Tesla. It missed delivery estimates for the first quarter, has reportedly reduced hours for the production line of its Cybertruck and is seeing rivals in China stack market share with low-priced EVs. Tesla, in other words, helped foster the global electric vehicle market but is losing some of its primacy in that same market.

Which may be a bigger risk than it seems. The global auto market is large, complicated and replete with different manufacturers and badges competing for share. What’s the risk of being a bit smaller than expected? For Tesla, a lot. The company is currently valued at a price/sales multiple of 6.2x, per Yahoo Finance. GM? It’s worth 0.34x. Ford? An even more modest 0.29x.

In human terms, for every dollar of car that Tesla sells, it generates far more company worth than its rivals. Why? Because many investors are betting that Tesla is not only going to keep growing its EV business that became a profit center in recent years, but also that its work in energy, energy storage and related industries will generate a company that is far larger, and more valuable over time. If Tesla was to trade at a GM or Ford-style revenue multiple, it would erase most of its worth.

And with price cuts, falling deliveries, increasingly sophisticated competition and now mass layoffs, Tesla is starting to look more like a traditional company than a company that can avoid traditional business rules and trade like its peers. Hit play, let’s chat!


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Tesla ditches EV inventory discounts to 'streamline' sales and delivery | TechCrunch

April 17, 2024 2:37 AM0


Tesla has ended discounts on inventory across its entire electric vehicle lineup — even as sales for EVs have flagged — as part of a larger and vague plan by CEO Elon Musk to “streamline the whole Tesla sales and delivery system.”

“It has become complex and inefficient,” Musk wrote in a post on X, the social media company he owns, in response to another user’s comment.

Musk’s announcement on X comes a day after thousands of Tesla employees lost their jobs. The layoffs, which will affect more than 10% of staff or about 14,000 people, were caused by poor financial performance, one source told TechCrunch.

One of Tesla’s delivery workers who was cut this week and spoke to TechCrunch on the condition of anonymity said their location was “short staffed” but still lost multiple employees. Tesla appears to have also eliminated most job listings — save a handful of postings related to its Manufacturing Development Program — from its North America careers page, suggesting a hiring freeze.

Rohan Patel, formerly Tesla’s VP of Public Policy and Business Development, told TechCrunch he also left the company Monday because of “[b]ig overall changes” at the company. Patel was one of two high-profile executives to leave Tesla this week, alongside Drew Baglino, formerly Tesla’s SVP of Powertrain and Energy.

The decision to end discounts across its lineup in the United States, including the Model 3, Model Y, Model S and Model X is a bit of a whiplash moment for Tesla. The company raised prices for most of 2022. The following year, Tesla started regularly dropping prices on all its vehicles with some models seeing their prices fall nearly 20%, a practice that has continued this year. In April, Tesla dropped the price of many long-range and performance Model Ys by $5,000 and real-wheel drive versions of more than $7,000.

It also follows last week’s announcement that Tesla would drop the monthly subscription cost of its Supervised Full Self-Driving software, Tesla’s advanced driver assistance system, to $99 per month, down from $199 per month.

While the price-cutting of 2023 may have helped Tesla sell a record 1.8 million vehicles, the automaker’s margins have shrunk. And in the first quarter of 2024, Tesla’s delivery numbers fell year-over-year. The automaker also built more cars than it shipped, a trend that has continued in seven of the last eight quarters, which might indicate an area where Tesla will renew its focus this year.

In January, Tesla did warn sales growth could be “notably lower” in 2024 compared to previous years as it prepares to launch a new vehicle platform — the $25,000 EV that appears to have been scrapped in favor of launching a robotaxi by August.

It’s not clear how removing discounts on Tesla vehicles fits into the automaker’s new strategy to streamline sales and delivery. Tesla could not be reached for comment.

Tesla has received a lot of credit for its direct-sales model, which circumvents the traditional dealer setup (and took many years and legal fights to accomplish). But beyond the initial purchase, Tesla has almost always been making changes to its sales and delivery strategy. The automaker has almost always made changes to its sales and delivery strategy.

In late 2018, Musk said that Tesla bought an undisclosed number of trucking companies in order to ship increasing numbers of Model 3 sedans. In early 2019, Musk abruptly announced that Tesla would close many of its retail stores and lay off workers “to achieve the savings required to provide [the Model 3] and be financially sustainable. Less than two months later, the company reversed course. More recently, Tesla announced in late 2022 that its typical end-of-quarter scramble to make and ship as many cars as possible was proving increasingly difficult. Tesla said it was going to smooth out that process — but more than a year later, it’s still dealing with these quarterly bottlenecks.




Software Development in Sri Lanka

Robotic Automations

Overture Maps Foundation releases the first beta of its open map dataset | TechCrunch

April 16, 2024 6:01 PM0


The Overture Maps Foundation today launched the first beta of its global open map dataset. With this, the foundation, which is backed by the likes of Amazon, Esri, Meta, Microsoft and TomTom, is getting one step closer to launching a production-ready open dataset for developers who need geospatial data to power their applications.

“This Beta release brings together multiple sources of open data, has been through several validation tests, is formatted in a new schema and has an entity reference system that allows attachment of other spatial data,” said Marc Prioleau, executive director of Overture Maps Foundation. “This is a significant step forward for open map data by delivering data that is ready to be used in applications.”

Overture was founded back in 2022, under the umbrella of the Linux Foundation. At the time, Linux Foundation executive director Jim Zemlin noted that “mapping the physical environment and every community in the world, even as they grow and change, is a massively complex challenge that no one organization can manage. Industry needs to come together to do this for the benefit of all.”

Now, two years later, some Overture members have already started integrating its data into their applications. Meta, the foundation says, is using Overture data for its map solutions while Microsoft is adopting it to add coverage to Bing Maps.

Overture’s dataset includes five base layers in the beta release that include 54 million places of interest, 2.3 billion buildings, roads, footbaths and other travel infrastructure, administrative boundaries, and a contextual base layer including land and water data.

In a world where OpenStreetMap (OSM) has been around for a very long time, it’s worth asking why the industry would need a project like Overture (which actually uses OSM data as part of its data set).

“Overture is a data-centric map project, not a community of individual map editors,” the project’s FAQ explains. “Therefore, Overture is intended to be complementary to OSM. We combine OSM with other sources to produce new open map data sets. Overture data will be available for use by the OpenStreetMap community under compatible open data licenses. Overture members are encouraged to contribute to OSM directly.”

Meta, Microsoft, AWS and TomTom launch the Overture Maps Foundation to develop interoperable open map data


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X makes Grok chatbot available to premium subscribers | TechCrunch

April 16, 2024 2:52 PM0


Social network X is rolling out access to xAI’s Grok chatbot to Premium tier subscribers after Elon Musk announced the expansion to more paid users last month. The company said on its support page that only Premium and Premium+ users can interact with the chatbot in select regions.

Last year, after Musk’s xAI announced Grok, it made the chatbot available to Premium+ users — people who are paying $16 per month or a $168 per year subscription fee. With the latest update, users paying $8 per month can access the chatbot.

Users can chat with Grok in a “Regular mode” or a “Fun mode.” Just like any other large language model (LLM) product, Grok shows labels indicating that the chatbot would return inaccurate answers.

We have already seen some examples of that. Earlier this week, X rolled out a new explore view inside Grok where the chatbot summarizes trending news stories. Notably, Jeff Bezos and Nvidia-backed Perplexity AI also summarizes news stories.

However, Grok seems to go one step further than just summarizing stories by writing headlines. As Mashable wrote, the chatbot wrote a fake headline saying “Iran Strikes Tel Aviv with Heavy Missiles.”

Musk likely wants more people to use the Grok chatbot to rival other products such as OpenAI’s ChatGPT, Google’s Gemini or Anthropic’s Claude. Over the last few months, he has been openly critical of OpenAI’s operations. Musk even sued the company in March over the “betrayal” of its nonprofit goal. In response, OpenAI filed papers seeking the dismissal of all of Musk’s claims and released email exchanges between the Tesla CEO and the company.

Last month, xAI open sourced Grok but without any training data details. As my colleague Devin Coldewey argued, there are still questions about whether this is the latest version of the model and if the company will be more transparent about its approach to the development of the model and information about the training data.

Why Elon Musk’s AI company ‘open-sourcing’ Grok matters — and why it doesn’t




Software Development in Sri Lanka

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Elon Musk says he'll unveil a Tesla robotaxi on August 8 | TechCrunch

April 16, 2024 9:31 AM0


Just hours after Elon Musk claimed Reuters was “lying” about Tesla’s plans to ditch its $25,000 low-cost EV and instead focus all its efforts on a robotaxi, the Tesla CEO announced on X that he would reveal said robotaxi in an event on August 8.

The announcement comes as Tesla EV sales have lagged and profits have fallen, leaving the company and its CEO on a search for another product to boost sales — or at least the stock price.

Earlier Friday, a Reuters report citing three anonymous sources and internal documents said that Tesla was abandoning its plan to build a lower-cost EV and would instead focus resources on a planned robotaxi that is being built on the same small EV platform that was also supposed to power the lower-cost vehicle.

Musk took to X, the social network he owns, and claimed without proof, that Reuters was “lying.” He did not dispute any specific details.

Hours later, Musk posted on X that a “Tesla Robotaxi” will be unveiled August 8.

Reports have swirled for years that Tesla was working on these two vehicles. But Musk has wavered on whether to prioritize a typical car or one with no steering wheel or pedals, despite not having yet produced a fully autonomous car, according to descriptions in Walter Isaacson’s biography of Musk.

The CEO  pushed back in mid-2022 against his engineers’ insistence on referencing a car with a steering wheel and pedals. And even as he pressed ahead, lead designer Franz von Holzhausen and engineering VP Lars Moravy kept the more traditional car version alive as a “shadow project,” Isaacson wrote at the time.

Musk has been promising autonomous capabilities in Tesla vehicles for years. In 2016, he said Tesla would drive itself cross-country by the end of 2017 (it didn’t happen). In 2019, he promised to launch the company’s first robotaxis as part of a broader vision for an autonomous ride-sharing network in 2020 (that also did not happen). A few years later, he said a dedicated robotaxi with no steering wheel or pedals would come to market by 2024.

Tesla vehicles come standard with a driver-assistance system branded as Autopilot. For an additional $12,000, owners can buy “full self-driving,” or FSD — a feature that CEO Elon Musk has promised for years will one day deliver full autonomous driving capabilities. Tesla vehicles are not self-driving. Instead, FSD includes a number of automated driving features that still require the driver to be ready to take control at all times, including the parking feature 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. The system is also supposed to handle steering on city streets.




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Robotic Automations

Tesla layoffs hit high performers, some departments slashed, sources say | TechCrunch

April 16, 2024 4:19 AM0


Tesla management told employees Monday that the recent layoffs — which gutted some departments by 20% and even hit high performers — were largely due to poor financial performance, a source familiar with the matter told TechCrunch.

The layoffs were announced to staff just a week before Tesla is scheduled to report its first-quarter earnings. The move comes as Tesla has seen its profit margin narrow over the past several quarters, the result of an EV price war that has persisted for at least a year. The company delivered a record 1.81 million vehicles in 2023. Its margins, however, took a hit after Tesla repeatedly slashed prices in a bid to drum up sales and undercut the competition.

Tesla informed employees that more than 10%, or about 14,000 workers, will be laid off across the global organization that has operations in the United States, Europe and China. The layoffs, which affected employees across all departments and seniority levels, were made to reduce costs and increase productivity to prepare for its “next phase of growth,” according to an internal email from CEO Elon Musk that TechCrunch has viewed.

High performers also cut

Many of the laid off employees were high performers, according to two sources who spoke to TechCrunch on condition of anonymity. One source expressed shock at the number of talented employees cut and noted that many of those affected were working on projects that have fallen lower on Tesla’s priority list. The source declined to specify which projects.

Some departments saw layoffs beyond the 10% outlined in the companywide email, according to sources. One manager told TechCrunch that 20% of their employees were cut.

“I lost 20% of my team, some really good players too,” they said.

The shakeup also comes as Musk continues to bend the company’s trajectory towards building fully self-driving cars. Tesla recently dropped plans to build a lower-cost EV that would retail starting at around $25,000, opting instead to use the underlying platform being developed to power an alleged robotaxi that Musk said will debut August 8.

Musk previously tried to prioritize the dedicated robotaxi vehicle project, according to his biographer, Watler Isaacson. In 2022, he told employees that he wanted a “clean robotaxi” with no steering wheel or pedals. Tesla lead designer Franz von Holzhausen and engineering VP Lars Moravy kept running the low-cost EV project in secret and eventually convinced him to make both — that is, until last week when it was reported that Musk changed his mind.

Top execs leave

Two high-profile executives — Drew Baglino, Tesla’s SVP of Powertrain and Energy, and Rohan Patel, VP of Public Policy and Business Development — also left the company.

Patel told TechCrunch he decided Sunday evening to leave Tesla because of “[b]ig overall changes” at the company. Patel, who had been engaging regularly with Tesla customers and fans on X in recent months, declined to be specific. He noted in a message that it would be “Better for me not to speculate.” “Tesla is going to be stronger than ever, and change is good,” he added.

Baglino told TechCrunch that after 18 years it was time to leave Tesla. “I feel good about the impact I’ve been able to achieve, my leadership team is strong, the energy businesses I’m responsible for are doing well, etc,” he wrote in a message to TechCrunch.

“Baglino was in charge of powerdrives and new battery projects, and there’s a sense that there isn’t a whole lot of innovation that’s sustainable at this point, which is probably why Baglino is leaving,” Sandeep Rao, head of research at London-based financial services company Leverage Shares, theorized in an interview with TechCrunch.

Baglino’s departure comes just a few months after Tesla’s previous CFO, Zachary Kirkhorn, stepped down. In January, Musk posted on X, formerly Twitter, that he would want to have around 25% voting control of Tesla in order to focus more fully on the company, rather than on his other companies, and help the EV-maker become a leader in AI and robotics.




Software Development in Sri Lanka

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Elon Musk plans to charge new X users to enable posting | TechCrunch

April 16, 2024 12:50 AM0


Elon Musk is planning to charge new X users a small fee to enable posting on the social network and to curb the bot problem.

In reply to an X account that posted about changes on X’s website, Musk said charging a small fee to new accounts was the “only way” to stop the “onslaught of bots”

“Current AI (and troll farms) can pass “are you a bot” with ease,” Musk said, referring to tools like CAPTCHA.

While replying to another user, Musk later added that new accounts would be able to post after three months of creation without paying a fee.

As is the case with a lot of announcements related to the social platform, there are no details at the moment about when this policy will be applicable and what fees new users might have to pay.

Last October, X started charging new unverified users $1 per year in New Zealand and the Philippines. New free users signing up for the platform from these regions could read the posts but couldn’t interact with them. To post content, like, repost, reply, bookmark, and quote posts, they had to pay a fee. Musk might apply a fee similar to other regions.

Earlier this month, X said that the platform was starting a major purge of spam accounts, warning users that their follower count might be affected. However, with a plan to charge new users, the social media company seemingly aims to tackle the bot problem better.

While Musk has talked about battling AI bots, last year, X updated its policy to include a clause that public posts could be used to train machine learning algorithms or artificial intelligence models. Separately, in July 2023, Musk said that his AI company xAI would use public posts to train models.

Earlier this month, xAI made its Grok chatbot available to Premium users of X, who pay $8 per month. The chatbot was previously available to users paying $16 per month for the Premium+ tier. Last week, Fortune reported that X plans to make Grok available to users to compose posts.




Software Development in Sri Lanka

Robotic Automations

Tesla is laying off more than 10% of its global workforce | TechCrunch

April 15, 2024 5:23 PM0


Tesla is laying off thousands of workers as it tries to simultaneously cut costs and boost productivity, according to CEO Elon Musk.

The electric automaker is cutting “more than 10%” of its global headcount, Musk said in an email reported by Electrek and Bloomberg News. Tesla finished 2023 with over 140,000 employees, meaning the cuts could impact more than 14,000 people.

The layoffs come just two weeks after Tesla announced its first year-over-year sales drop in years, amid a wider cooling of EV sales. The company has warned investors that sales growth could be “notably lower” in 2024 than its stated goal of growing 50% each year. It’s also somewhat in between product cycles for the first time in a long time, with the expensive Cybertruck only just recently going into production and the popular Model Y entering its fourth year without any significant updates.

“As we prepare the company for our next phase of growth, it is extremely important to look at every aspect of the company for cost reductions and increasing productivity,” Musk said in the email. Tesla’s growth, he said, has led to “duplication of roles and job functions in certain areas.”

“As part of this effort, we have done a thorough review of the organization and made the difficult decision to reduce our headcount by more than 10% globally. There is nothing I hate more, but it must be done. This will enable us to be lean, innovative and hungry for the next growth phase cycle,” Musk wrote.

Tesla shipped a record 1.8 million EVs in 2023. But the company spent much of the year slashing prices on its most popular models in an effort to counterbalance high interest rates and increased global competition. Tesla reportedly dropped — or at the very least, delayed — plans to build a lower-cost EV starting at around $25,000, opting instead to use the underlying platform being developed to power an alleged robotaxi that Musk said will debut on August 8th.

 


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