Elon Musk May Want Trump, But Tesla Doesn't Want His Policies
Happy Monday! It’s August 12, 2024, and this is The Morning Shift, your daily roundup of the top automotive headlines from around the world, in one place. Here are the important stories you need to know.
Tesla Had A Very Interesting Week
1st Gear: Musk Backs Trump, But Tesla Lobbies Against His Policies
Elon Musk and the company that made him a household name have been at odds recently. There was the pay package debacle, the time Musk threatened to take the AI wing and leave, his recent weird waffling over climate change — Musk and Tesla are far from seeing eye to eye. Now, that even extends to preferences in political action, according to Reuters:
When Elon Musk endorsed Donald Trump for president last month, the Tesla founder and chief executive backed a candidate who vows to “drill, baby, drill,” “end the electric vehicle mandate” and reduce subsidies of the sort that helped Tesla become the U.S.’s dominant EV manufacturer.
So instrumental have government loans, tax breaks and other EV policies been to Tesla’s fast growth that despite Musk’s gradual embrace of the former president and his Republican Party rhetoric in recent years, the company continues to lobby the U.S. and state governments for benefits championed by the Democratic Party.
In February, for instance, Tesla in a filing with the U.S. Environmental Protection Agency, or EPA, urged the Biden administration to allow California to pursue stricter vehicle emissions rules than the rest of the country – an idea Trump opposes.
Months earlier, in a previous filing with the agency, Tesla lobbied the government for regulations that would ban the production of most new gasoline cars by 2035 – the so-called “EV mandate” that Trump and others on the American right have criticized.
It’s likely that Musk simply cares enough about other political causes to ignore a mismatch on climate, but he’s become something of a right-wing figurehead — an odd position for a self-proclaimed environmentalist to hold. Does he still proclaim that?
2nd Gear: McLaren Attempts A Bold New Strategy Of Making Money
McLaren isn’t necessarily the household name that Ferrari and Lamborghini are, but the company’s CEO wants to change that. He also wants to match the Italians on another, perhaps more important metric: Profitability. From Automotive News, which interviewed CEO Michael Leiters:
In the first quarter your gross profit improved. Will McLaren be profitable this year? Next year?
We will show shortly that it is possible to have a cash-generative business even though investments in our future increase. This additional investment probably will need cash flow later. But we are on our way to becoming profitable and much more efficient cash-wise than in the past.
…
Ferrari, Lamborghini and Bentley have shown how profitable the ultraluxury sector can be. What is their secret?
The most important thing is you must have a strong brand and a strong product. You must manage both very well and there have been some drawbacks in the past [at McLaren].
Such as?
Our product plan right now is much less focused on volume than it was in the past to get higher average pricing, more revenue with less volume. To create scarcity and exclusivity around the product.
What is your average selling price?
We are around 240,000 pounds (about $304,500).
It’s kind of incredible that a company can sell cars for over $300,000, on average, and not be considered sufficiently profitable. I guess that’s just how it is, though, when the line doesn’t go sufficiently up.
3rd Gear: Stellantis To Lay Off Up To 2,450 Workers With RAM Classic Cancellation
The Ram 1500 Classic is dying out, as Stellantis moves to cut costs, and a new filing from the company says that the truck is taking nearly 2,500 jobs with it — though, maybe not quite that many. From Automotive News:
Stellantis says it will indefinitely lay off as many as 2,450 workers as its Warren Truck Assembly Plant in Michigan ends production of the Ram 1500 Classic to focus solely on the Jeep Wagoneer SUV.
The automaker said layoffs would begin as soon as Oct. 8 and that the actual number of workers affected likely would be lower than the number it provided in a notice filed with the state.
The move comes after Stellantis cut one of two daily production shifts at the plant in July for what it said then would be a temporary reduction in output. The automaker is in the midst of a global cost-cutting drive under CEO Carlos Tavares.
Warren Truck, located just north of Detroit, will move to one shift for general assembly, though “other operations within the plant will remain on two shifts to support Jeep Wagoneer production,” Stellantis said. Warren Truck has around 3,900 employees, about 3,700 of whom are represented by the UAW.
Getting rid of 2,450 people out of a plant that only employs 3,900 would be a massive drop by percentage, so it’s not surprising the company is aiming its sights lower. Can’t imagine it’s a fun time to work in Warren Truck, though, with this looming over your head.
4th Gear: Robotaxis Are Already Costing Jobs In China
Self-driving cars are neither here nor imminent, but that hasn’t stopped companies around the world from setting prototypes loose on public roads to rake in those sweet sweet investor dollars. Sure, the cars may not “work” or “be safe to drive near,” but they’re the future of a new industry! Think of all the money! Money that, it turns out, would otherwise have gone to human people. From Reuters:
Ride-hailing and taxi drivers are among the first workers globally to face the threat of job loss from artificial intelligence as thousands of robotaxis hit Chinese streets, economists and industry experts said.
Self-driving technology remains experimental but China has moved aggressively to green-light trials compared with the U.S which is quick to launch investigations and suspend approvals after accidents.
At least 19 Chinese cities are running robotaxi and robobus tests, disclosures showed. Seven have approved tests without human-driver monitors by at least five industry leaders: Apollo Go, Pony.ai, WeRide, AutoX and SAIC Motor.
Apollo Go said in May it planned to deploy 1,000 robotaxis in Wuhan by year-end. In 2022, it had forecast it would be operating in 100 cities by 2030.
Robotaxis in China here are simply an example of a larger trend — ever more automation means there are fewer and fewer jobs, especially compared to a growing population. Yet, instead of ushering in a post-scarcity society in which automation means every need is cared for, we’re instead left to wonder how the people whose jobs have been automated away will put food on the table and keep a roof over their heads. And don’t say “learn to code” unless you want your CS degree profits tanked by a massive influx in workers that crater the supply side of the labor equation.
Reverse: He Did In Fact Have Time To Die
On The Radio: Krystal Swords – ‘Elysium’
