The theme of this week’s newsletter: progress is painful. For instance, as it shifts more resources into EVs, Ford is cutting 8,000 jobs tied to internal combustion engines. Lyft may be making a smart decision in ditching the rental car business, but it’s costing at least 60 people their jobs in the process. Tesla is yet again hiking the price of its misnomer technology, “Full Self Driving.” A number of ride-hailing startups are championing a model based on fairly compensated full-time employees, but they’re running up against customer expectations shaped by Uber and Lyft’s limitless labor pool.
Another big theme this week is liberal cities that aren’t living up to their ideals. For instance, many cities, under the banner of environmentalism and equity, are building new bike lanes, but they’re still not willing to make the big changes necessary to build comprehensive bike networks that will provide a meaningful alternative to cars. Many of these same American cities have been blessed with booming economies and booming populations, but their refusal to build enough housing for newcomers has created an affordability crisis that is crushing the poor and squeezing the middle class. Finally, transit advocates say that a train catching on fire in Boston has become a powerful metaphor for persistent negligence of public transit.
But then there’s news that doesn’t fall into either category. Amazon starts using Rivian e-vans for delivery, Tesla gets a dedicated lane in Mexico to get products through to the U.S. border, Luminar partners with Geely on autonomous tech, Cruise readies another robo-taxi launch and Northvolt, a Swedish startup, wants to make EV batteries … from trees
Rivian gets its Amazon debut: The retail behemoth begins to make deliveries with electric vans made by Rivian. Amazon says the Rivian vehicles are being used in about a dozen U.S. cities but will be present in about 100 by the end of the year. The plan aims for 100,000 Rivian delivery vans on the road by 2030.
Tesla gets its own lane in Mexico: In a highly unusual deal, the Mexican state of Nuevo Leon agrees to provide Tesla a dedicated lane to ship parts from several manufacturers in Mexico across the U.S. border. This should reduce shipping time and costs.
Luminar teams up with Geely: Luminar, the Florida-based lidar startup that went public via SPAC two years ago, is making an investment of an undisclosed value in Chinese auto startup, Ecarx, co-founded by Eric Li, founder of auto giant Geely. The investment is just one part of an ongoing collaboration between Luminar and Geely on autonomous automotive technology.
In case public transit wasn’t hurting enough: A Boston subway caught fire as it traveled on a bridge over the Mystic River, prompting people to climb out of windows onto the tracks and at least one person to jump into the river. The fire was apparently caused by a metal strip coming loose from the train and making contact with the electrified third rail. This comes only a month after the Federal Transit Administration said the Massachusetts Bay Transportation Authority needs to “raise the bar on safety.” Some hope the incident will prompt local leaders to deliver much-needed upgrades to Beantown’s aging transit system.
Lyft gives up on car rentals: Lyft is calling it quits on the car rental business it launched two-and-a-half years ago. Lyft Rentals sought to distinguish itself with very low prices –– $35 a day with no mileage limits –– and by serving customers as young as 22, instead of the standard 25 year minimum required by most rental services. Lyft, which is laying off 60 employees as it shuts down the service, says it will instead focus on partnerships with legacy rental services, such as Hertz and Sixt.
Cruise readies Dubai launch: The problems that have arisen from its launch of fully driverless ride-hailing in San Francisco have not deterred Cruise from planning to operate autonomous robo-taxis in Dubai. The GM-backed startup has begun mapping out the city’s streets in anticipation of launching sometime next year.
Ford eyes job cuts to fund EVs: The automaker may cut up to 8,000 positions in the coming weeks in an effort to free up resources for its burgeoning EV businesses. As the company shifts from ICEs to EVs, it will likely need fewer workers, a fact that has made the United Autoworkers very nervous.
Uber drivers strike for a day: The UK-based App Drivers and Couriers Union called on its members to turn off their Uber apps for 24 hours in protest of some of the bad behavior by the company that was recently exposed in a leak of tens of thousands of internal corporate documents. The union claims that between 1,000 and 6,000 drivers took part in the strike, potentially driving Uber of millions of dollars in revenue.
Tesla will hike cost of FSD beta: In an earnings call, Elon Musk says the price of the “Full Self Driving” beta, which earlier this year went from $10,000 to $12,000, will likely go up again.
Batteries…from wood? Northvolt, the Swedish battery startup backed by VW, will incorporate carbon components derived from trees in its batteries. It is partnering with Finnish forestry company Stora Enso.
What if ride-hailing ditches the gig worker model? TechCrunch takes a look at Alto, the Dallas-based ride-hailing startup that owns and operates a fleet of luxury SUVs driven by professionally trained drivers. The company claims that it is better-positioned to eventually become an autonomous ride-hailing service than rivals that rely on independent contractors driving their own cars. But in the meantime, Alto’s finite supply of rides might make it a tough sell to consumers who have become accustomed to apps that can draw on a virtually unlimited labor pool.
Speaking of gig workers, could co-ops be the future of ride-hailing? Wired looks at gig drivers who have opted to develop their own worker-owned ride-hailing services. It remains to be seen whether Uber and Lyft are capable of ever turning a profit, but there are already many drivers who have concluded that Uber and Lyft were not as good of a deal as they were led to believe. Some are simply quitting, while others are looking for ways to make the gig economy work on their own terms.
Blue America’s housing crisis: In his podcast for the New York Times, Ezra Klein talks with urban economist Jenny Schuetz about the numerous barriers to affordable housing erected by some of America’s most liberal cities. Backwards land use regulations have led to economic and racial segregation and made it much harder for people to get around without owning a car (or two).
Cadillac v. Rolls Royce: Writing for CNN, Peter Valdes-Dapena argues that Cadillac is seeking to reconquer a “space it hasn’t occupied in decades,” with the Celestiq, an ultra-luxury EV that could be priced as high as $300,000. That type of price tag puts it in direct competition with the likes of Rolls Royce and Bentley. One auto historian says this move is somewhat reminiscent of the 1957 Cadillac Eldorado Brougham, only 400 of which were made. But even the Eldorado only sold for $13,000, which is still only $137,000 in 2022 dollars.
Wait, you expected the bike lane to go somewhere? American cities are rapidly adding new bike lanes, but few are willing to take the politically difficult steps of building truly comprehensive bike networks due to the dominance of car culture and car-centric planning. The failure to take these steps ensures that cycling remains a fringe commuting method.
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