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The Specialty Equipment Market Association trade show, which we know as SEMA, has long been the place to go to see quirky and flashy modifications to vehicles. This year, a major shift occurred that reflects what is happening across the country. I wasn’t able to attend this year, but folks I spoke to said they have never seen so many gas-to-electric conversions of sports cars, vintage hot rods and the like.
Of course, there was also a number of automakers displaying their new electrified vehicles, including the Ford F-100 Eluminator concept truck. We care about this concept because it showcases something that Ford is actually going to sell. The automaker is selling (available online or at a local dealer through Ford Performance Parts) the Eluminator electric crate motor. The motor comes from the Mustang Mach-E GT Performance Edition and produces 281 horsepower and 317 lb.-ft. of torque.
As always, you can email me at email@example.com to share thoughts, criticisms, opinions or tips. You also can send a direct message to me at Twitter — @kirstenkorosec.
Lime closed a $523 million round made up of convertible debt and term loan financing, the next step as the company prepares to go public next year, according to CEO Wayne Ting. The largest chunk of the round is convertible note, which means it will convert to shares when Lime goes public, something Ting says the company will do next year, but he didn’t say when or how. About $20M of that total funding will go towards the company’s decarbonization efforts. Among many initiatives that Lime put forth in time for COP26 is the company’s goal to get 80% of its manufacturing and supply chain partners to set their own carbon emissions goals.
Bird, one of Lime’s biggest competitors, went public via the old SPAC route on Friday. Shares of Bird closed basically flat at $8.40. Bird plans to use the money from the IPO to expand existing operations and launch in new cities. After Bird’s shareholders voted for the merger earlier this week, shares of the SPAC, Switchback II Corporation, sunk more than 20% before recovering.
Singapore-based Neuron Mobility is updating its N3 scooters with a new OS and additional onboard sensors to help it detect and correct dangerous or inconsiderate riding. A lot of companies have come out with some form of tech angled at offering the rider assistance in not driving like a jerk (Spin, Voi, Bird, Superpedestrian and Helbiz to name a few…), but they haven’t all delivered on that promise “at scale,” whatever that means. Neuron will be trialing about 1,500 of these upgraded scooters in Australia, Canada and the UK over the next six months.
European micromobility company Dott became one of the latest operators to integrate with Google Maps. Dott’s e-scooters and e-bikes will show up on the app in Belgium, Finland, France, Germany, Italy, Norway, Poland, Spain and the UK.
Helbiz launched a fleet of 250 e-scooters in Sacramento, California after securing a one-year permit.
The UK and Beam launched a partnership in Australia and New Zealand to raise awareness of electric mobility in order to help reduce transport-fueled carbon emissions. They’re offering incentives in the form of ride credits to those who have yet to use a form of electric mobility.
Gojek, Indonesian mobility and on-demand platform, and Gogoro, a Taiwanese micromobility battery swapping platform company, announced a partnership to electrify two-wheel transportation in Indonesia. The two, along with Indonesian national energy company Pertamina, are starting a battery swapping and Gogoro Smartscooter pilot scheme in Jakarta.
PeopleForBike and Call2Recycle have teamed up to create the first industry-wide electric bicycle battery recycling program in the United States. The hope is to unite the sector under one battery recycling solution.
Deal of the week
I wanted to turn your attention to an autonomous vehicle company that seems to be able to raise abundant amounts of capital and still remain under the radar.
I’m talking about Nuro, the autonomous delivery company founded in 2016. The company raised $600 million in a fundraising round led by new investor Tiger Global Management. Google was another new investor in this round.
The funding has pushed Nuro’s valuation to about $8.6 billion — or some 72% higher than a year ago — according to people who spoke to me on condition on anonymity. A group of mostly existing investors joined the Series D round, including Baillie Gifford, Fidelity Management & Research Company, China-based venture firm Gaorong Capital, grocery retailer Kroger, SoftBank Vision Fund 1, funds and accounts advised by T. Rowe Price Associates, Inc. and Woven Capital, a venture arm of Toyota subsidiary Woven Planet.
Much of it will be spent on commercializing and scaling the production of its third-generation vehicle at a new facility in Southern Nevada. Construction on its manufacturing facility will begin in December and is expected to be completed in 2022.
Other deals that got my attention …
42dot, a South Korea-based autonomous transportation-as-a-service startup, raised $88.5 million (104 billion WON) in a Series A round of funding that included participation from new investors like Shinhan Financial Group, Lotte Rental, Lotte Ventures, STIC Ventures, We Ventures, DA Value Investment and others.
Autobrains, an Israeli-based company that develops AI technology for assisted and autonomous driving, raised $101 million in Series C funding round led by Temasek. Additional participants in the round include new investors Knorr-Bremse AG, VinFast and existing investor BMW and strategic partner, Continental.
Breadfast, an online grocery delivery company that wants to become a regional leader in the sector, raised $26 million in Series A financing from lead investors Vostok New Ventures and Endure Capital. JAM Fund (led by Tinder co-founder Justin Mateen), YC Continuity Fund, a large unnamed Saudi-based fund, Shorooq Partners, 4DX Ventures and logistics giant Flexport also participated.
Delimobil, Russian car-sharing company, decided to postpone its initial public offering due to market conditions, Reuters reported.
Momenta, an autonomous vehicle developer from China, raised another $500 million that was added to its Series C round. The funding comes two months since it announced a $300 million investment from General Motors. This latest injection of capital brings the total of the startup’s Series C to over $1 billion.
Opibus, a Swedish-Kenyan EV conversion company, raised $7.5 million in pre series A round. The startup raised $5 million in equity and $2.5 million in grants in a round led by Silicon Valley fund At One Ventures, backed by Factor[e] Ventures and pan-African VC firm Ambo Ventures.
Rivian hopes to raise up $8.4 billion in its initial public offering, according to a regulatory filing posted this past week. The Amazon-backed company said in the filing that it plans to offer 135 million shares at a price between $57 and $62. Underwriters also have an option to buy up to 20.25 million additional shares. If underwriters exercise that option, Rivian would raise as much as $9.6 billion.
Based on the number of outstanding shares, that would put its market valuation at about $53 billion. If employee stock options and other restricted shares are considered, Rivian’s valuation could be as high as $60 billion.
Spartan Radar, a biomimetic radar company, closed $15 million in a Series A round led by Prime Movers Lab. Additional investors include 8VC and Mac VC. The round follows a $10 million raise earlier this year.
Scale AI acquired SiaSearch, a spinout of European venture studio Merantix that has built a data management platform that acts as a search engine for petabyte-scale data captured by advanced driving assistance and automated driving systems.
Zepto, a new Indian-based grocery delivery startup, raised $60 million in a round led by Glade Brook Capital. Nexus, Y Combinator, Global Founders Capital, as well as angel investors Lachy Groom, Neeraj Arora and Manik Gupta also participated in the round, which values Zepto at $225 million.
Hello everyone! Welcome back to Policy Corner.
Quick note from Kirsten: After the newsletter was “put to bed,” Congress passed President Biden’s infrastructure bill, mostly along party lines. Expect more details on that next week.
First, let’s talk briefly about the Hertz-Tesla deal. I know, I can hear you groaning already. One of the things that both Tesla played up was that Hertz is paying sticker price for the 100,000 Teslas it ordered (apparently without a contract, though that’s another story).
But they likely didn’t pay full price. In fact, Turo’s VP of government relations, Lou Bertuca, told me he was 100% certain that Hertz didn’t pay sticker price, thanks to a tax loophole that allows rental car companies to avoid paying sales tax. He told me that each year states lose out on around $4 billion in taxes due to this loophole.
The sales tax exemption was designed for car resellers, but car rental companies have also been able to benefit from this ‘sale for resale exemption.’ “They’re buying something tax-free and making lots of money by renting it out,” he said.
‘Anytime a car rental company says they’re paying the same rate as everybody else, the only thing you need to keep in mind is they’re not paying the sales tax that everybody else is paying, whether they’re buying a Tesla or Ford.” (ProWellTech reached out to Hertz for comment.)
Around five or six states are currently reconsidering this loophole, Bertuca said. Of course, Turo, a peer-to-peer marketplace for car rental, has its own dog in this fight. And it’s important to note that state and local governments can levy taxes on rental car companies that peer-to-peer rental companies (like Turo) are exempt from — here’s a good run-down on that battle.
In other news, Canada said it would “respond appropriately” should the U.S. pass the proposed increase for consumer tax incentives for electric vehicles. The country’s Innovation and Industry Minister Francois-Philippe Champagne told Reuters that the proposal — which would provide an additional $4,500 for EVs made in the U.S. and in union shops and $500 for U.S.-made batteries — would run contrary to the USMCA trade agreement we have with Canada and Mexico.
He joins a growing chorus of foreign auto and auto parts manufacturers, including Toyota and Honda, who are opposing the additional funds.
I listened to a pretty interesting interview with Flavio Volpe, president of Canada’s Automotive Parts Manufacturers’ Association, who made the case that ‘American-made’ is ultimately a nice political slogan that doesn’t accurately reflect dynamics on the ground. He noted that $9 billion worth of auto parts are exported from Michigan for assembly in Ontario — parts that would go into cars that would be excluded from the additional incentive, should it pass.
“Really in our business, we operate as if there’s no border, because there hasn’t been,” he said.
If you have a spare 20 minutes, I encourage you to listen to the entire interview. It definitely made me think about the automotive supply chain in a new way.
— Aria Alamalhodaei
A little bird
Just a quick little note that I’ve been meaning to share. Remember Starsky Robotics? This was the self-driving trucks startup that shut down in March 2020 as competition and consolidation in the industry heated up.
Co-founder and former CEO Stefan Seltz-Axmacher is back with a stealth startup focused on robotics and autonomy, according to his profile in LinkedIn. Next to it, he states “More info soon!”
Notable news and other tidbits
Tesla voluntarily recalled nearly 11,704 vehicles after identifying a software error that could cause a false forward-collision warning or unexpected activation of the automatic emergency brake system, the National Highway Traffic and Safety Administration said.
Cruise was busy this week. The company held an “Under the Hood” event that was meant, besides a recruiting activity, to lay out its technical and development road map. CTO and co-founder Kyle Vogt released a YouTube video of his driverless ride and late Friday the company filed an application for the CPUC Driverless Deployment Permit, as well as the accompanying required Passenger Safety Plan.
“Cruise has hit another important milestone today as the first company to apply for the final state permit required to launch an autonomous ride-hail service in California. Our accompanying Passenger Safety Plan outlines the safety and accessibility measures passengers can expect from start to finish in our AVs —- a critical facet of our overall, holistic approach to safety at Cruise,” Prashanthi Raman, head of global government affairs at Cruise, said in an emailed statement to ProWellTech.
Embark announced a partnership with Luminar to equip its truck fleet with Luminar’s long-range radar. Embark says this partnership will help the company as it tries to achieve commercial deployment and delivery of its 14,200 non-binding truck reservations in 2024.
Loyola Marymount University and its dining platform have partnered with autonomous robot delivery company Kiwibot to deliver meals across the university campus.
Waymo announced plans to manually drive its vehicles to map areas of New York City and then use all of that data to advance its technology.
Ford Motor confirmed that reservations for the all-electric F-150 Lightning pickup truck have surpassed 160,000, less than six months after its debut. But remember, refundable $100 pre-orders are not the same as purchases! Let’s see how many that the leap this coming spring.
Lucid Group has spent the last week delivering its Air electric vehicle to customers. The company also opened up its 11th store (it calls them “studios) in Washington DC.
Nikola Corp., the electric truck developer, is in talks with the U.S. Securities Exchange Commission to pay a $125 million civil penalty as part of an ongoing probe by the regulator into whether the company mislead investors.
Rivian, the electric automaker that recently filed for an IPO, was sued by a former sales and marketing vice president for alleged gender discrimination. The lawsuit alleges that Laura Schwab, a former sales and marketing executive who had a long employment history with Jaguar Land Rover and Aston Martin before joining Rivian in November 2020, was fired after reporting gender discrimination to the company’s human resources department.
In-car tech and sensors
BMW is going to ship some models without touchscreen functionality because of the global chip shortage, according to BMW enthusiast forum Bimmerfest. The infotainment system will still work, but BMW has removed touch functionality from the central display.
Kneron launched its first automotive-grade chip — fueled by funds from Foxconn, Alibaba, Sequoia, Horizons Ventures and Qualcomm — that it says could revolutionize the path to vehicle autonomy.
Velodyne Lidar named Theodore Tewksbury as its new CEO, the most recent in a string of changes to Velodyne’s C-suite since the beginning of this year. Tewksbury was the CEO of Eta Compute, a company that develops edge vision sensors. As you might recall, the company has been without a CEO for several months, after Velodyne announced the departure of Anand Gopalan in July.
Uber and Lyft posted earnings this week.
Lyft kicked things off with news that it reached adjusted profitability as riders returned to the U.S. ride-hailing company’s service. Lyft reported revenues of $864.4 million in the third quarter, a 73% pop from the $499.7 million in the same year-ago period.
Meanwhile, Uber squeaked out $8 million worth of adjusted EBITDA — a very modified profit metric — while still posting net losses of more than $2 billion. Uber’s gross bookings (or the value of all goods and services that flowed through its platform) totaled $23.1 billion, up 57% on a year-over-year basis. That figure translated to revenues of $4.8 billion, up 72% compared to the year-ago quarter.
To be clear, while adjusted EBITDA is one metric of profitability it’s not the grown-up GAAP profitability. Still, it’s a noteworthy milestone for these businesses.