cars can now take on human players in a game of chess, thanks to a . Its programmers likely didn’t imagine they were designing a chess program to take on the best players in the world, however: U.S. No. 1 ranked chess player Fabiano Caruana (also currently ranked No. 2 in the world) played a Tesla Model 3 in a recent match… but Deep Blue versus Kasparov, this was not. Caruana bests the vehicle in just under five minutes of playing time, and he’s not particularly stressing the time, plus he’s offering a running commentary. The car makes some questionable moves, but to be fair, it’s not a super computer with deep artificial intelligence, and Caruana is one of the world’s best. He also gives it credit at the end, calling the game “challenging” and you can hear it’s probably more than he was expecting from a car’s infotainment system. The car would probably beat me, but I’m unranked and haven’t played a game of chess in probably 15 years, so there’s that.
cars can now take on human players in a game of chess, thanks to a . Its programmers likely didn’t imagine they were designing a chess program to take on the best players in the world, however: U.S. no. 1 ranked chess player Fabiano Caruana (also currently ranked no. 2 in the world) played a Tesla Model 3 in a recent match… but Deep Blue vs. Kasparov, this was not. Caruana bests the vehicle in just under five minutes of playing time, and he’s not particularly stressing the time, plus he’s offering a running commentary. The car makes some questionable moves, but to be fair, it’s not a super computer with deep artificial intelligence, and Caruana is one of the world’s best. He also gives it credit at the end, calling the game “challenging” and you can hear it’s probably more than he was expecting from a car’s infotainment system. The car would probably beat me, but I’m unranked and haven’t played a game of chess in probably 15 years so there’s that.
Tesla CEO Elon Musk checks out the Model Y during its unveiling in March. (Tesla via YouTube) Tesla is aiming to raise up to $2.3 billion in newly announced offerings of stock and convertible notes, just a week after CEO Elon Musk told analysts that the . Musk himself will purchase an additional $10 million of common stock, Tesla said today in a . That would add to his status as the electric-car company’s largest shareholder, with roughly 20 percent of Tesla’s shares. The share price was more than 3.5 percent above the previous day’s close during midday trading today. Wedbush Securities analyst Dan Ives said in a note to investors that the offerings were a “clear net positive for Tesla” because they cleared up long-lingering uncertainty over whether Tesla would have enough cash on hand to meet upcoming debt payments. One of the offerings announced today will make $650 million in common stock available, while the second offering calls for the issuance of up to $1.35 billion in convertible senior notes due in 2024. There’s also a 30-day option for underwriters to purchase up to an additional 15% of each offering. If all the options are exercised, the gross proceeds would come to about $2.3 billion before discounts and expenses, Tesla said. Goldman Sachs and Citigroup are acting as joint lead managers for the offering, with involvement as well from BofA Merrill Lynch, Deutsche Bank Securities, Morgan Stanley, Credit Suisse, Societe Generale and Wells Fargo Securities. The company said it would “use the net proceeds to further strengthen its balance sheet, as well as for general corporate purposes.” In last week’s financial report, Tesla for the first quarter of the year, after posting profits for the previous two quarters. Looking ahead, the company has ambitious plans to ramp up production of its Model 3 electric car and move ahead with projects ranging from its Semi truck, Model Y crossover SUV and all-electric pickup truck to electricity-generating solar roofs, a and car insurance. Some analysts worry about the effect of Tesla’s financial losses, the gradual fade-out of federal tax credits and rising competition in the electric-vehicle market. Such uncertainties, coupled with , have led to dramatic ups and downs in the share price over the past year. A year ago, for Tesla’s investors: “Do not buy if volatility is scary,” he said.
Tesla CEO Elon Musk unveils the Model 3 electric car in 2016. (Tesla via YouTube) Tesla CEO Elon Musk has to keep his Twitter habit in check — and feels comfortable enough with the arrangement to refer to it in a teasing tweet. Friday’s settlement was a serious matter: Musk could have faced sanctions for contempt of court if he failed to patch up the rift with the SEC over whether he was following the terms of an . To refresh your memory, the SEC last September for incorrectly claiming on Twitter that he had secured funding to buy up publicly traded shares of the Tesla electric-car company and take the company private. Under the terms of the settlement of that fraud case, Musk and Tesla each paid a $20 million fine, Musk agreed to surrender his title as chairman, and he agreed to have tweets about Tesla reviewed in advance by a company overseer. (Some folks have referred to that person as Musk’s “Twitter sitter.”) During the months that followed, Musk made statements suggesting that he had a loose interpretation of what fell under the Twitter sitter’s purview, and in February he sent out a controversial Tesla-centric tweet that the company’s lawyers acknowledged wasn’t cleared in advance. Tesla made 0 cars in 2011, but will make around 500k in 2019 — Elon Musk (@elonmusk) That’s what set off the . U.S. District Judge Alison Nathan told Musk and the SEC to resolve their differences, and after a couple of extensions, the two parties finally filed the for Nathan’s review and likely approval. The consent motion gets specific about the topics that Musk will have to have the company overseer review before issuing written statements in venues ranging from Twitter to press releases and blog posts. (We’ve included the list at the end of this report.) Musk didn’t make any direct comments about the agreement, or how he’ll change his tweeting ways, but he did touch on the tiff in a Twitter conversation about his Twitter habit. (So meta!) Here’s how the exchange played out: sometimes i think Neuralink is already implanted in you… how can you keep up with all of your twitter mentions & pick which one is important or interesting to respond to!? — Evelyn Janeidy Arevalo (@JaneidyEve) Only see about 5% of mentions. No deep logic to those I answer. Aspirationally useful, but often whimsical. — Elon Musk (@elonmusk) It’s just me writing, so the foolish things I say are entirely my fault
Tesla CEO Elon Musk introduces the Tesla Semi truck and an updated version of the Tesla Roadster at a 2017 unveiling. (Tesla via YouTube) Tesla today reported wider-than-expected financial losses in the first quarter — due to what the company said were delivery challenges, a seasonal dip in demand and the unanticipated effects of pricing decisions. Despite the downturn from what had been a profitable couple of quarters, Tesla CEO Elon Musk was bullish on several fronts, including rollouts for the company’s and , plus the opening of Tesla’s Gigafactory in Shanghai, China. Musk is even planning to offer car insurance policies starting next month, with pricing determined by the data that’s received from the company’s cars. “We have direct knowledge of the risk profile of customers and the car,” he explained during today’s teleconference with financial analysts. “If they want to buy Tesla insurance, they have to agree to not drive the car in a crazy way. Or they can, but then the insurance rate is higher.” If it’s done right, in-house insurance could add another revenue stream to Tesla’s bottom line. That could help ease the pain for Tesla’s accountants as well as for investors, who have seen share prices slump due to concerns about long-term profitability. (The price slipped nearly 2 percent during today’s trading, to $258.66 at the close.) Net losses amounted to $702 million, and adjusted net losses per share were $2.90. That’s 13 percent worse than the year-ago figure and . Revenue was $4.5 billion, which was better than the year-ago figure but not as high as analysts thought it would be. In its , Tesla said there was a production jam-up that forced a large number of deliveries to be deferred into the second quarter. “This is the most difficult logistics problem I’ve ever seen, and I’ve seen some tough ones,” Musk said. In all, 63,000 electric cars were delivered during the first quarter, which fell far short of expectations. In addition to the logistical challenges, Tesla said pricing changes for its Model S and Model X cars caused a higher-than-anticipated return rate. One disincentive to sales was the gradual phase-out of federal tax credits for electric vehicles. Previously: The good news is that powertrain improvements have boosted the performance and range of those two models: The maximum range was extended to 370 miles on a full charge for the Model S, and 325 miles for the Model X SUV. For the past two years, Tesla has been focused on ramping up production of the Model 3, which finally . Tesla reported producing 63,000 Model 3 cars during the quarter and is aiming to raise that figure higher. “If our Gigafactory Shanghai is able to reach volume production early in Q4 this year, we may be able to produce as many as 500,000 vehicles globally in 2019,” the company said in its shareholders’ letter. “This is an aggressive schedule, but it is what we are targeting.” Musk said that the Shanghai construction project was “going incredibly well,” and that he was receiving “midnight Gigafactory email” on an almost nightly basis. On other financial fronts: Tesla’s cash on hand fell by $1.5 billion over the course of the quarter, to $2.2 billion. A $920 million convertible bond repayment accounted for most of that reduction, and the delivery snag was an additional factor. Another, linked to Tesla’s SolarCity subsidiary, is said to be due this month. One analyst asked Musk whether he wished that he had persevered with efforts to take Tesla private last year — efforts that ended up getting him in hot water with the Securities and Exchange Commission. “I would prefer that we were private,” Musk replied, “but unfortunately that ship has sailed.” Musk told analysts that “at this point I do think there is some merit to raising capital,” but he didn’t provide further details.
Tesla shows off a configuration for a Robotaxi front seat without a steering wheel. (Tesla via YouTube) Tesla’s billionaire CEO, Elon Musk, laid out a vision for a huge fleet of self-driving electric vehicles that owners could share with friends or other riders, with Tesla getting a cut of the proceeds. The Robotaxi concept relies on the ability to make Tesla cars fully autonomous, to the point that the steering wheels can be removed. “By the middle of next year, we’ll have over a million Tesla cars on the road with full self-driving hardware, feature complete, at a reliability level that we would consider that no one needs to pay attention,” Musk told investors at Tesla’s headquarters in Palo Alto, Calif. Musk acknowledged that the timetable could be in flux, due to regulatory concerns as well as his tendency to get overly optimistic about timetables. He pointed to Tesla’s past achievements, including the creation of the all-electric Roadster, Model S, Model X and Model 3, as well as its production of solar roofs for power generation and battery packs for personal and grid-level energy storage. “Only criticism, and it’s a fair one, [is that] sometimes I’m not on time,” Musk said. “But I get it done, and the Tesla team gets it done.” Based on Tesla’s market performance, Musk might still have some convincing to do: During today’s trading, share prices declined nearly 4 percent, to $262.75 per share, and drifted in after-hours trading during . The downturn had more to do with , including a downgrade in Evercore’s market outlook and this week’s expected news of first-quarter losses. Nevertheless, the trend underscored the view that Musk’s Robotaxi plan wouldn’t be a slam-dunk. Tesla CEO Elon Musk discusses the Robotaxi concept. (Tesla via YouTube) The concept would let Tesla owners make their car available for others to drive when they’re not using it, through a smartphone-based app system that matches up cars with riders. Tesla and the owner would share revenue from the ride. Tesla estimates that the cost to run a Robotaxi would be less than 18 cents per mile, compared with 62 cents per mile for U.S. ownership cost and $2 to $3 per mile for traditional ridesharing models. The fact that no driver is required is key to the financial formula. During the Autonomy Day presentation, Tesla engineers spent most of their time laying out the case for expecting that their computer-vision system would satisfy the requirements for full autonomy within the next year or so. Tesla cars that were built since October 2016 would be eligible for over-the-air upgrades to full autonomy, but not cars sold before that time, Musk said. “Unless it’s designed in, it’s not worth it,” he said. Musk said he expected full autonomy to transform the automotive market within two or three years. “Once regulators are comfortable with us not having a steering wheel, we’ll just delete that. … The probability of the steering wheel being taken away in the future is 100%. Consumers will demand it,” he said. In an , Cornell University computer scientist Bart Selman said that’s debatable. Selman said Tesla may face an “extra level of difficulty” because it’s aiming to get to full autonomy by relying exclusively on computer vision without including a lidar laser-scanning system. There’s a broader issue as well: Statistically speaking, self-driving cars may well be safer than human-driven cars — but could conceivably fall prey to unusual accident scenarios that humans would easily avoid, such as . “The question then becomes whether society will choose the greater overall safety level over the risk of having certain types of ‘non-human’ accidents occur with some regularity,” Selman wrote. Other questions had to do with the business model for Robotaxi. Musk said Tesla would operate its own on-demand cars in areas where there weren’t enough to serve the market. He pointed out that Tesla’s leased cars will not be available for purchase when the lease expires, and that those cars would be reclaimed for Tesla’s Robotaxi fleet. One analyst asked about a scenario in which Tesla owners worked out their own car-sharing schemes. That led Musk to point out that a clause in Tesla’s contract forbids drivers to do ride-sharing outside Tesla’s own network. But couldn’t drivers work out a car rental arrangement? “Seems easy,” the analyst said. “OK …” Musk replied. Musk also acknowledged that Tesla, and not the car’s owner, would probably be held responsible for any accidents or injuries caused by Robotaxis. “The right thing to do is to make sure there are very few accidents,” he added. Will regulators go for the idea? That may well be the multimillion-dollar question for Tesla. “We won’t have regulatory approval everywhere, but I’m confident we’ll have regulatory approval somewhere,” Musk said. Even assuming that full autonomy wins regulatory clearance, Tesla would still face formidable competition from the likes of , , Alphabet’s venture and GM’s subsidiary. and are also joining the fray.
MagniX CEO Roei Ganzarski shows off a drum-sized, 350-horsepower electric motor that will soon be hooked up to an airplane propeller at the company’s lab in Redmond, Wash. (GeekWire Photo / Alan Boyle) REDMOND, Wash. — An electric-propulsion company called MagniX shifted its headquarters from Australia to Redmond just a few months ago — but it’s already revving up for takeoff. The venture, owned by Singapore-based , is on track to conduct its first flight tests with an all-electric motor installed in a converted plane by the end of the year, CEO Roei Ganzarski told GeekWire this week during a tour of MagniX’s digs. The two-story office space in Redmond already houses more than 15 employees, and Ganzarski plans to hire 20 more in the next three months, mostly in engineering. Roughly 50 more employees are working at MagniX’s facility in Arundel, about 40 miles south of Brisbane on Australia’s Gold Coast. MagniX’s baby sits on a test stand in the Redmond facility’s lab: a round electric motor that weighs about 110 pounds and is small enough to fit inside a carry-on bag. Looks can be deceiving, however: That drum-sized Magni 250 motor can churn out 350 hp. The Magni 250’s specifications make it possible to power an eight- to 15-passenger airplane like the Cessna Caravan. And MagniX is gearing up to produce a 220-pound version, the Magni 500, which will put out 750 hp at 1,900 rpm. That’s even more suited to replace internal combustion engines in existing planes. “Welcome to electric aviation,” Ganzarski said. He compared MagniX’s position in the aviation industry to Tesla CEO Elon Musk’s position in the automotive industry. “Look back seven years at electric cars,” Ganzarski said. “No one said it could be done. Everyone pooh-poohed Elon Musk at Tesla. ‘There’s not enough batteries, you won’t get the range, it’s not as good as a traditional car.’ And he had the vision to say, ‘No, we’ll make it happen, and that will start the ripple effects.’ Lo and behold, it did. Every car manufacturer has an electric car.” MagniX’s business plan calls for starting small: Ganzarski said he already has an airplane manufacturer lined up to install MagniX’s electric-propulsion system into Cessna-class airplanes, plus an operator that’s primed to fly the converted aircraft on routes with a range of roughly 100 miles. “We’re not talking about a 737 or a private jet,” he said. “They fly short distances. Look at a FedEx feeder, look at a look at a . … These are all 10-, 20-, 30-minute flights.” Just as the Tesla Roadster blazed the trail for Tesla’s Model S, Model X, Model 3 and Model Y, those short-range flights could blaze a trail for low-cost, zero-emission flights that take advantage of thousands of underused regional airports in places like Moses Lake and Ellensburg, Wash. Ganzarski said electric aviation could bring a 70 to 80 percent reduction in flight costs. And if that comes to pass, it could open up whole new opportunities in air transportation. “If it’s that cheap to fly to Ellensburg, guess what? Maybe Amazon could do two-hour shipments to Ellensburg, instead of five-day shipments on a truck,” Ganzarski said. “Think about an airfield in Redmond or Issaquah, and Ellensburg. Suddenly Ellensburg could be a suburb of Seattle.” Could it really happen? And is MagniX the company to do it? The business model that Ganzarski has in mind is similar to what Kirkland, Wash.-based Zunum Aero is pursuing for its hybrid-electric aircraft. Zunum Aero won big-name backing from Boeing HorizonX and JetBlue Technology Ventures, but it closing its next financing round. Ganzarski argues that MagniX has two advantages on its side: First, the company is going with an all-electric approach rather than Zunum’s more complex hybrid propulsion system. He drew another analogy to the auto industry: “If I’m selling hybrid today, I’m selling history.” The second advantage has to do with MagniX’s funding. Because it’s wholly owned by the Clermont Group, Ganzarski doesn’t have to worry about raising venture capital. “We are not a traditional startup,” he said. “We are not venture-backed, we are a fully funded company. Which means that I, as a CEO, and our company can focus on our long-term goal.” That goal, Ganzarski said, has everything to do with connections. “We’re both completely aligned on the vision of prosperity and connecting communities,” he said. “They also know that this isn’t an 18-month return. This isn’t an app that we’ll sell to somebody in 18 months and get an exit. This isn’t about that. This is about building a generational business that will have a positive impact on society. “None of us have options in the company,” Ganzarski said. “We’re not here because we think that one day we’ll be rich. We’re here with a mission. We want to be able to tell our grandkids that they’re all flying on clean, low-cost aircraft because of what we did in 2018 and 2019.”
Tesla has started offering the long-promised $35,000 standard version of its Model 3 electric car. (Tesla Photo) Tesla is finally following through on its pledge to sell its Model 3 electric cars at the standard price of $35,000, but says it’s shutting down on-the-spot showroom sales to remain “financially sustainable” at the lower price point. Going forward, worldwide sales will shift to online only, the company says. Many of Tesla’s stores will be shut down over the next few months, . A small number of stores in high-traffic locations will remain open as galleries, showcases and information centers, but would-be buyers will have to go online to close the deal. Tesla touted the ease of online sales: “You can now buy a Tesla in North America via your phone in about 1 minute, and that capability will soon be extended worldwide. We are also making it much easier to try out and return a Tesla, so that a test drive prior to purchase isn’t needed. You can now return a car within 7 days or 1,000 miles for a full refund. Quite literally, you could buy a Tesla, drive several hundred miles for a weekend road trip with friends and then return it for free.” In a conference call with reporters, Tesla CEO Elon Musk said reducing overhead would boost the company’s long-term financial stability. “Ultimately this will be a very strong competitive strength for Tesla,” he said. The announcement came after Musk built up the mystery surrounding today’s 2 p.m. PT announcement. Some speculated that Tesla would lift the curtain on its Model Y crossover SUV, or provide a surprise sneak peek at the all-electric pickup truck that Musk said would be “something quite unique.” Instead, the announcement made good on Musk’s years-old promise that the Model 3 would be offered at the “affordable” base price of $35,000. Up to this point, Tesla had been selling only versions with longer range, steeper price tags and bigger profit margins. The standard Model 3 will have 220 miles of range, a top speed of 130 mph and the ability to go from zero to 60 mph in 5.6 seconds. There’ll also be a Model 3 Standard Range Plus that offers a 240-mile range, 140 mph top speed and zero-to-60 mph acceleration in 5.3 seconds, with a price tag of $37,000 before incentives. Tesla said the shift to online-only sales, plus “other ongoing cost efficiencies,” will open the way for reducing vehicle prices by an average of about 6 percent, “allowing us to achieve the $35,000 Model 3 price point earlier than we expected.” Hitting the $35,000 price point should boost Tesla’s sales, but the move could also raise questions about the company’s profit margin. Musk acknowledged that Tesla is likely to report a loss for the first quarter of 2019, after turning a profit in the and of 2018. “Given that there is a lot happening in Q1, and we are taking a lot of one-time charges — there are a lot of challenges getting cars to China and Europe — we do not expect to be profitable.” Musk said. “We do think that profitability in Q2 is likely.” Tesla has also had to deal with a controversy sparked by Musk’s tweets about Model 3 production rates, which . Due to this week’s rush of developments, — including an after-hours dip that came in the wake of today’s announcement.