Tesla says its battery innovations will deliver its goal of a $25,000 mass market electric car

Tesla held its ‘Battery Day’ event on Tuesday to discuss a variety of innovations it has developed and is pursuing in battery technology for its vehicles. At the event, Tesla CEO Elon Musk and SVP of Powertrain and Energy Engineering Drew Baglino detailed new anode and cathode technology it’s working on, as well as materials science, in-house mining operations and manufacturing improvements it’s developing to make more more affordable, sustainable batteries – and they said that taken together, these should allow them to make an electric vehicle available to consumers at the $25,000 price point.

“We’re confident we can make a very, very compelling $25,000 electric vehicle, that’s also fully autonomous,” Musk said. “And when you think about the $25,000 price point you have to consider how much less expensive it is to own an electric vehicle. So actually, it becomes even more affordable at that $25,000 price point.”

This isn’t the first time that Musk has talked about the $25,000 price point for a Tesla car: Two years ago in August 2018, he said that he believed the company would be able to reach that target price point in roughly three years. Two years on, it seems like the goal posts have been pushed out again – fairly standard for an Elon-generated timeline – since Musk and Baglino acknowledged that it would be another two or three years before the company could realize the technologies it presented in sufficient quantities to be produced effectively at scale.

Tesla detailed a new, tablets battery cell design that would help it achieve its goal of reaching 10 to 20 terawatts of global battery production capacity per year. The design offers five times the energy density of the existing cells it uses, as well as six times the power and an overall 16% improvement in range for vehicles in which it’s used.

Virtual Mobility startup pitch night applications open

TechCrunch is on the hunt to feature 10 early-stage mobility startups at our virtual TC Sessions: Mobility 2020 pitch night. The pitch-off event, originally set for May, will now be held October 5th – the evening before Mobility 2020. 

The top five companies from pitch night will take the stage at the main event with industry heavy hitters like  Boris Sofman of Waymo and Nancy Sun of Ike to Trucks VC’s Reilly Brennan. Now we are shining a light on game changing startups – hardware and software breaking the mobility mold. From battery advancements to mapping, fuel processing to micromobility, TechCrunch wants the next generation of mobility’s brightest on stage. The process is simple:

ApplyTechCrunch editorial will review every application and demo video submitted. Companies will be reviewed based on innovation, scope of impact, uniqueness of product idea and potential for exit – IPO or acquisition. Selected companies will get to pitch on stage, receive two complimentary event tickets, an hour training with the Startup Battlefield Editor and a spot in CrunchMatch: TC’s meeting matching program.

Pitch Part I. The top ten startups from around the world will be selected to pitch live to the TC audience on the virtual stage. After a private pitch coaching session, founders will have one minute to pitch, followed by a Q&A with our expert panel of investor and industry expert judges.

Pitch Part II. The top five companies from pitch night will get a prime slot to pitch and demo their product on the main stage at Mobility 2020 in front of thousands of TC viewers – press, industry leaders and VCs.

The deadline to apply is September 15th. Selections will occur on a rolling basis so get your application in ASAP!

Radio Flyer teams up with Tesla to launch a tyke-sized Tesla Model Y

If, like me, you can’t afford a full-sized Tesla because your life has been a series of bad investments (one day my early Fyre Festival backing will pay off) then Radio Flyer’s newest product might be just the thing for you. It’s a scaled down Model Y, designed for use by kids aged 18 months to four years old – but I can play pretend and yell ‘vroooommm’ just as well, if not better, than they can.

Dubbed ‘My First Model Y,’ this is a collaborative effort between the Tesla Design Studio and Radio Flyer’s product team. It’s a ride-on version, which is not true of the standard Model Y, and it includes a honking horn, as well as black induction wheels (an upgrade option on the real car) and a functional steering wheel, with a price point of $99. There’s only one trim level.

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Unlike the first collaboration between Radio Flyer and Tesla, the Tesla Model S for Kids, this one doesn’t have a built-in battery – it requires kid power to function. That means a lot more affordability, and makes it suitable for much younger kids.

I might pick up one of these instead of just continuing to scrawl “Tesla” in block letters on the rear window of my 1998 Toyota Camry in grease pencil.

Security bugs let these car hackers remotely control a Mercedes-Benz

Few could ever forget back in 2015 when security researchers Charlie Miller and Chris Valasek remotely killed a Jeep’s engine on a highway with a Wired reporter at the wheel.

Since then, the car hacking world has bustled with security researchers looking to find new bugs — and ways to exploit them — in a new wave of internet-connected cars that have only existed the past decade.

This year’s Black Hat security conference — albeit virtual, thanks to the coronavirus pandemic — is no different.

Security researchers at the Sky-Go Team, the car hacking unit at Qihoo 360, found more than a dozen vulnerabilities in a Mercedes-Benz E-Class car that allowed them to remotely open its doors and start the engine.

Most modern cars are equipped with an internet connection, giving passengers access to in-car entertainment, navigation and directions, and more radio stations than you can choose from. But hooking up a car to the internet puts it at greater risk of remote attacks — precisely how Miller and Valasek hijacked that Jeep, which ended up in a ditch.

Although vehicle security has gotten better over the past half-decade, Sky-Go’s researchers showed that not even one of the most recent Mercedes-Benz models are impervious to attacks.

In a talk this week, Minrui Yan, head of Sky-Go’s security research team, said the 19 security vulnerabilities were now fixed, but could have affected as many as two million Mercedes-Benz connected cars in China.

Katharina Becker, a spokesperson for Mercedes’ parent company Daimler, pointed to a company statement published late last year after it patched the security issues. The spokesperson said Daimler could not corroborate the estimated number of affected vehicles.

“We addressed all findings and fixed all vulnerabilities that could be exploited before any vehicle in the market was affected,” said the spokesperson.

After more than a year of research, the end result was a series of vulnerabilities that formed an attack chain that could remotely control the vehicle.

To start, the researchers built a testbench to reverse-engineer the car’s components to look for vulnerabilities, dumping the car’s software and analyzing the car’s internals for vulnerabilities.

The researchers then obtained a Series-E car to verify their findings.

At the heart of the research is the E-Series’ telematics control unit, or TCU, which Yan said is the “most crucial” component of the car, as it allows the vehicle to communicate with the internet.

By tampering with the TCU’s file system, the researchers got access to a root shell — a way to run commands with the highest level of access to the vehicle’s internals. With root shell access, the researchers could remotely open the car’s doors.

The TCU file system also stores the car’s secrets, like passwords and certificates, which protect the vehicle from being accessed or modified without proper authorization. But the researchers were able to extract the passwords of several certificates for several different regions, including Europe and China. By obtaining the vehicle’s certificates and their passwords, the researchers could gain deep access to the vehicle’s internal network. The car’s certificate for the China region had a weak password, Yan said, making it easier to hijack a vulnerable car in the country.

Yan said the goal was to get access to the car’s back end, the core of the vehicle’s internal network. As long as the car’s back-end services can be accessed externally, the car is at risk of attacks, the researchers said.

The way the researchers did this was by tearing down the vehicle’s embedded SIM card, which allows the car to talk to the cell networks. A security feature meant the researchers couldn’t plug the SIM into a router without freezing access to the cell network. The researchers modified their router to spoof the vehicle, effectively making the cell network think it was the car.

With the vehicle’s firmware dumped, the networking protocols understood and its certificates obtained and cracked, the researchers say they could remotely control an affected vehicle.

The researchers said the car’s security design was tough and able to withstand a number of attacks, but it was not impervious.

“Making every back-end component secure all the time is hard,” the researchers said. “No company can make this perfect.”

But at least in the case of Mercedes-Benz, its cars are a lot more secure than they were a year ago.


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China’s electric SUV maker Li Auto raises $1.1 billion in U.S. IPO

Trade tensions between China and the U.S. have not stopped Chinese companies from eyeing to list on American stock exchanges. Li Auto, a five-year-old Chinese electric vehicle startup, raised $1.1 billion through its debut on Nasdaq on Thursday.

The Beijing-based company is targeting a growing Chinese middle class who aspire to drive cleaner, smarter, and larger vehicles. Its first model, sold at a subsidized price of 328,000 yuan or $46,800, is a six-seat electric SUV that began shipping end of last year.

Li Auto priced its IPO north of its targeted range at $11.5 per share, giving it a fully diluted market value of $10 billion. It also raised an additional $380 million in a concurrent private placement of shares to existing investors.

The IPO arrived amid a surge of investor interest in EV makers. Tesla’s shares have skyrocketed in the last few quarters. Li Auto’s domestic rival Nio, which raised a similar amount in a $1 billion float in New York back in 2018, also saw its stock price rally in recent months.

Li Auto is one step ahead of its Chinese peer Xpeng in planning its first-time sale. The six-year-old competitor said last year it may consider an IPO. Last month, a source told South China Morning Post that Xpeng was getting ready for the listing.

Founders of China’s emergent EV startups are often shrewd internet veterans who are well-connected in the venture capital and marketing world, attracting investment dollars in the billions. Li Auto, for instance, counts China’s food delivery mogul Wang Xing, boss of Meituan Dianping, as its second-largest shareholder after its CEO Li Xiang. TikTok parent ByteDance shelled out $30 million in its Series C round.

Investors are in part emboldened by Beijing’s national push to electrify China’s auto industry. The question, then, is whether these startups have the right talent and resources to pull things off in an industry that traditionally demands a much longer development cycle.

Wallace Guo, a managing partner at Li Auto’s Series B investor Taihecap, admitted that “the nature of auto consumption, unlike internet products evolving through trial and error, manufacturing a car, is a strategic move with sophisticated system, very long value chain, requiring huge investment and resources and any error can be fatal.”

Mingming Huang, chief executive of Future Capital, said that “it was a no brainer in 2015 to be the first investor” in Li Auto. The venture capitalist said Li, who ran a popular car-buying online portal before getting into manufacturing, “has the rare combination of being a relentless talent as well as a top-notch product manager that excels in creating value for all stakeholders.”

Customers testing Li Auto’s SUV in China. Photo: Li Auto

Both investors believed Li Auto has picked the right path of zeroing in on extended-range electric vehicles. EREVs come with an auxiliary power unit, often a small combustion engine, that ensures cars can still operate even when a charging station is not immediately available, a shortage yet to be solved in China.

As my colleague Alex pointed out, Li Auto is on a trajectory similar to that of its peer Nio, going public after a short history of delivering to customers. The startup only began shipping its first model last December and delivered just over 10,000 units as of June, its prospectus showed.

The startup is still deep in the red, losing 2.44 billion yuan ($350 million) in 2019, up from a net loss of 1.53 billion yuan in 2018. It did finish the first quarter of 2020 with a gross profit of $9.6 million after it began monetization.

Its annual revenue — which comprised mostly of car sales and a small portion from services like charging stalls — stood at 284 million yuan ($40.4 million) in 2019, a tiny fraction of Nio’s $1.12 billion. But Nio also amassed a greater net loss of $1.62 billion in the same year. In contrast, Tesla has been profitable for four straight quarters.

Li Auto’s investors are clearly bullish that the Chinese startup can one day match Tesla’s commercial success.

“Xiang has a deep understanding of the preferences and pain points of car owners and drivers in China. Li Auto is the first in China, to successfully commercialize extended-range electric vehicles, solving the challenges of inadequate charging infrastructure and battery technologies constraints,” Huang asserted.

“The company is able to get positive gross margin when selling the first batch of vehicles and thus with its growth in sales volume, its gross margin was well above competitors and can live long enough to become a ten billion-dollar company with this healthy business model,” said Guo.

The Hummer EV is shaping up to be GM’s electric answer to the Ford Bronco and Tesla Cybertruck

The video below contains the first glimpse at the upcoming electric GMC Hummer. The preview video is short, full of nonsense buzzwords, but still telling. It’s clear GM identified two main competitors against the upcoming Hummer: The Ford Bronco and Tesla Cybertruck.

The Hummer EV was announced pre-COVID 19 during the Super Bowl. At the time, GM promised it would feature 1,000 HP from the electric powertrain. Since then, little has been released about the upcoming vehicle, though GM maintains it’s still on track for production in the fall of 2021.

The video released today sports a handful of expected features and capabilities. Interestingly enough, these features are on both sides of the motoring spectrum. If categorized, they fall into two groups: on-road thrills and off-roading adventure. The video paints a clear picture: GM is targeting the Hummer EV against the Tesla Cybertruck and the Ford Bronco — both vehicles that are getting a lot of attention because of their capabilities and design.

For positioning against the Cybertruck, GM is touting the Hummer EV’s power of 1,000 HP and 11,500 lb-ft of torque (though this number is derived in a different fashion than usual). It’s also saying the massive truck can hit 60 mph in 3 seconds, which is in the same realm as the top sports cars. Lastly, the video teaser stated the Hummer EV has an Adrenaline Mode, which is easy to assume is similar to Tesla’s Ludicrous mode, along with improved self-driving capability.

For the Bronco, GM is showing the Hummer EV’s off-roading features, including a so-called Open Air Infinity Roof and Modular Sky Panels, which is likely similar to the Bronco’s expansive removable roof. Even more telling is the Crab Mode mentioned in the video. Crab Mode is likely a high-torque rock crawling mode for when bouldering off-road. With the crazy amount of torque available, the Hummer EV will probably be able to crawl up impressive inclines.

Pricing and exact availability have yet to be announced, and the same can be said about the Tesla Cybertruck. And don’t forget about the upcoming electric Ford F-150. There’s a war of the electric pickup coming, and I’m here for it.

GM details 12 upcoming electric vehicles from Cadillac, GMC, Chevrolet, and Buick

General Motors is on track to deliver 20 electric vehicles by 2023, the company said in its latest sustainability report. That includes models for nearly all of its brands, including Cadillac, GMC, Chevrolet, and Buick.

Most of these vehicles utilize GM’s new modular EV architecture called Ultium. With this platform, GM says some vehicles will have a range of 400 miles, acceleration of 0-60 in 3 seconds, and come in front-wheel drive, rear-wheel drive, and all-wheel-drive configurations.

What follows is a look at 12 of these forthcoming models. Specific details are missing, but the list provided by GM’s sustainability report illustrates an automaker going all-in on electric.

Cadillac

  • Cadillac Lyriq: Previously announced, supposedly will be Cadillac’s first electric vehicle with a price of around $75,000.
  • Three-row SUV that GM says will emphasize interior space and cargo capability.
  • A small crossover like Cadillac’s current XT5
  • A full-size, three-row SUV “that builds on the DNA of the brand’s highly successful Escalade.”
  • Cadillac Celestiq Statement Vehicle: Previously announced, supposedly will be a handmade, ultra-luxury vehicle with a price tag around $200,000.

GMC

  • GMC Hummer Truck: Previously announced, 1,000 HP electric truck.
  • GMC Hummer SUV that’s similar to the Hummer Truck, but configured like an off-road SUV.

Chevrolet

  • An electric Chevy pickup truck with a range of over 400 miles on a charge.
  • Mid-size SUV for the American market
  • An aggressive Chevy Bolt electric crossover that includes GM’s Super Cruise self-driving.

Buick

  • A “conventional crossover” that maximizes interior space and cargo
  • A Buick Crossover that “feature more expressive proportion with a greater emphasis on form and athletic fashion.”

To build the vehicles listed here, General Motors says it is on track to allocate more than $20 billion of capital and engineering resources to its electric and autonmous vehicle programs between 2020 and 2025.

UK’s Drover raises $26M for to take its car subscription marketplace to Europe

The future of transportation is in a moment of flux, and that continues to provide opportunities for startups to build solutions provide new ways for us to get from A to B. In the latest development, a startup out of the UK called Drover that provides access to flexible car subscriptions for private users — longer than a typical rental, shorter than a lease or purchase, and easy to shorten or extend as needed — is announcing some funding to continue its growth.

The company has picked up £20.5 million ($25.7 million) in a round of funding co-led by three firms:  Target Global, RTP Global (the Russian company formerly known as ru-Net) and Autotech Ventures. New investors Channel 4 Ventures and Rider Global, as well as previous backers Cherry Ventures, BP Ventures, Partech, Version One and Forward Partners all also participated. Drover is not disclosing its valuation. It’s raised £27.5 million to date.

The plan, CEO and founder Felix Leuschner said in an interview, is to use the money to continue investing in the technology it uses to calibrate prices and personalise offers for individuals, as well as to hire more talent and gear up for more expansion. Founded in the UK, Drover opened France earlier this year. In theory, wherever cars are sold and used is game, and Drover’s growth to date seems to point to it being a strong candidate for driving ahead to new frontiers.

That’s because despite the huge drop in the economy in the last several months because of COVID-19, perhaps because of its flexible model (fitting for when you don’t know what is coming around the corner) Drover has seen business go up. “May and June have been our best two months on record for us since launching three years ago,” said Leuschner, who added that it is continuing to see an acceleration in the business, doubling in revenues year on year. “Every month should be the best month when you’re a growing startup, but we’ve seen acceleration even beyond that.”

Car ownership is going through an interesting phase at the moment. It was not that long ago when many people believed that the Ubers of the world, combined with other innovations in transportation like autonomous driving, improved public and communal transport models, on-demand rentals and new vehicles like electric bikes and scooters, would all combine to make it easier for individuals to forego traditional private car ownership altogether — the idea being that collectively, they would provide an economical, convenient and eco-friendly enough mix to make buying and maintaining a car obsolete.

That idea might still have some mileage longer term (excuse the pun!), but current events have thrown it for a loop: the COVID-19 pandemic has meant that people are staying at home a lot more, and when they do go out, many are proactively eschewing transportation forms that involve sharing space or touching surfaces that others have touched.

“We think this will lead to a renaissance for cars,” Leuschner said — a fact echoed by its investors.

“Drover offers an attractive and affordable alternative to car ownership, which has proven to be extremely robust during the recent COVID-19 crisis with record high subscriber bookings,” said Anton Inshutin, partner at RTP Global, in a statement. “We fully share in Felix’s vision for Drover as the future European leader in the car-as-a-service market, and offered our support to the company in both Series A and Series B financings.”

But even without a global health pandemic, there were a number of signals that pointed to the fact that “disruption” might not have been a quick and seamless transition anyway. We’re a long way off from actual autonomous cars (you know, the ones that are predicted to be so expensive and tricky to maintain that most will not own them but will subscribe to services to be driven around). The Ubers of the world haven’t actually sorted out their unit economics. Scooters can be dangerous. Etc.

For better or worse, all of that brings us back to private cars, and the opportunity to play around with different ways of providing these to individuals, opening the door to companies like Drover to tap those who may have started to part with the idea of owning a car outright, but have yet to let go of the idea of using a private car altogether.

Target demographics, Leuschner said, are people in their 20s and 30s who have some disposable income for a car and are more likely to be keen to pay the premium on incremental ownership to forego total cost of ownership, if it proves to be cheaper than leasing for the one-month minimum of usage on Drover (which appears to be Drover’s main competitor).

Not all is Fair

Others have attempted to tackle the subscription car market before, also focusing on customers that want to have the use of cars for more than just an hour or a day or even a week but don’t want to pay out to own them outright or get locked into long leases.

One of those — Fair in the US — looked to be especially promising with big-name founders raising hundreds of millions of dollars in equity and debt from companies including Softbank. But it ultimately faced a spectacular implosion, unable to get the business model right.

Leuschner contends that while Drover might sound like the same model as Fair, it’s actually a very different vehicle on the inside. For starters, some two-thirds of its inventory is sourced from dealerships, OEMs and others that distribute cars.

They use Drover as another channel, in part to diversify distribution, and in part as a way of tapping stock that it’s not able to sell through other channels. The remaining one-third is bought in by Drover, which means that the startup gets better margins on those vehicles as the owner of the vehicles, but also means higher risk for the startup — one of the areas where Drover’s technology comes into play.

“It’s an optimisation game for us,” said Leuschner. “When you have open inventory you get a better margin but more risk. We are at that point where we know what the best vehicles are for our customer base and we have a lot of data and trading history. We’re comfortable taking some risk and higher margin structure in those cases.”

Another key difference is that Drover is also only focusing squarely on private individuals, rather than working on subscriptions for professional drivers. That has meant that the drop off in business from those users, which some car leasing companies have seen as a knock-on effect from the fall in demand on ridesharing platforms, hasn’t had an impact for Drover.

It’s nonetheless a big market with many opportunities for growth. Online car sales are still only one percent of all sales in the UK, he said, which is far below the rate of sales for retail goods at 20% (one reason that might be obvious: the bigger the ticket, the more likely people will want to see the goods in person). All of that is gradually shifting — not least because more recognised names are coming into the fold, and providing more legitimacy and guarantees in the process, and that opens the door to companies like Drover, too

“By tapping into ongoing digitalisation and on-demand trends in tandem, Felix and his team are well poised to aggressively seize market share from traditional car retailers,” said Ben Kaminski, partner at Target Global, in a statement. “This new capital injection is a testament to both the team and the tech behind Drover which is disrupting the car-ownership model for the better. We’re excited to offer our support as Drover continues to scale throughout Europe.”

Daniel Hoffer, MD at Autotech Ventures added in his own statement: “After studying the European landscape closely, we believe that Drover’s unique focus on a next-generation customer experience enabled by an asset-light approach has the potential to revolutionize how Europeans relate to car ownership. Bolstered by strong execution, Drover is poised to emerge stronger as a result of COVID-19 and recession-driven changes to consumer preferences in the ground transportation domain.”

Tesla lowers the starting price of its Model Y electric SUV

Tesla has lowered the price of another vehicle. This time it’s the Model Y, an electric SUV the company started shipping in March. The long-range all-wheel drive version of the car is now listed with a purchase price of $49,990, or $3,000 less than what it was before. The car’s new pricing was first reported by Electrek over the weekend.

In May, Tesla cut prices for several of its electric cars, including high-end vehicles like the Model S sedan and the Model X SUV. The new pricing comes as U.S. automakers try to attract buyers despite the economic fallout of the COVID-19 pandemic.

The traditional big three U.S. automakers, Ford, GM and Fiat Chrysler Automobiles, are offering 0% financing rates, in addition to deferred or longer-term payment options, while other automakers have also announced incentives and payment plans to appeal to new buyers and keep existing owners from defaulting on loans.

At the beginning of this month, Tesla said it delivered 90,650 vehicles in the second quarter, a 4.8% decline due to the pandemic and suspension of production at its main U.S. factory for several weeks, but still better than analysts’ expectations. Most of the deliveries, or 80,050, were Model 3 and Model Y, while the remaining 10,600 were its higher-end Model S and Model X.

Karma Automotive raises $100 million as it looks to resell it EV platform to other automakers

Karma Automotive has raised a $100 million lifeline from outside investors, as reported by Bloomberg, with the struggling electric vehicle maker’s fortunes likely buoyed by the current market optimism on other EV companies including Tesla. Karma is the reincarnated version of Fisker Automotive, which previously faced bankruptcy before being acquired by Wanxiang Group in 2014.

Karma Automotive has made more progress than Fisker ever did, including actually delivering around 500 of its inaugural Revero electric sport sedan in 2019. The company will be continuing to sell the Revero, which retails staring at around $140,000, and will also be looking to add a high horsepower GTE version, as well as a supercar for an even higher-tier customer.

The automaker also says that it’s in discussions with a partner for a commercial delivery truck, which it intends to develop in prototype form by year’s end. There are a number of different companies pursuing delivery vans for use by courier companies including UPS and FedEx, and the increase in e-commerce spending does present an opportunity for multiple players to succeed in this category, even as there is a rush on in terms of entrants.

Karma will also seek to leverage and extend the benefits of its fresh investment by shopping around its EV platform to other automakers and OEMs, the company says, and also will eventually expand beyond pure EVs to hybrid fuel vehicles. In short, it sounds like Karma is willing to try just about everything and anything to chart a path towards profitability, but time will tell if that’s intelligent opportunism, or scattershot desperation.