Charged up by strong sales of its electric cars and SUVs, Tesla on Monday posted its seventh-straight profitable quarter.
The company made $438 million in the three-month period that ended March 31, as sales more than doubled the same period last year to nearly 185,000 vehicles.
Tesla said adjusted net income, excluding stock-based compensation, passed $1 billion for the first time in company history.
The company also said that there is evidence that a person was behind the wheel of a Tesla that crashed in Texas earlier this month, killing two men. But authorities near Houston said investigators are sure that no one was driving the car when it missed a curve, hit a tree and went off the road.
The April 17 crash near Houston has brought renewed scrutiny of Tesla and its Autopilot partially automated driving system. Two federal agencies are joining local authorities in investigating.
Excluding stock-based compensation and non-recurring items, Tesla made 93 cents per share. That beat Wall Street estimates of 75 cents per share, according analysts polled by data provider FactSet. First-quarter revenue rose 74% to $10.39 billion, but it was just shy of the $10.48 billion expected by analysts.
Once again the company needed regulatory credits purchased by other automakers in order to make a profit. Without $518 million in credits for the quarter, Tesla would have lost money. Other automakers buy the credits when they can’t meet emissions and fuel economy standards.
The company, which also makes solar panels and batteries, made only $16 million in the first quarter of 2020.
Tesla, which now has the sixth-largest market value of all companies in the S&P 500 at $708.56 billion, saw its shares fall about 2.5% in extended trading Monday. The company released numbers just after the markets closed.
Tesla said its cash position fell by $2.24 billion in the quarter to $17.14 billion, due mainly to bitcoin purchases and $1.2 billion in debt and finance lease payments. That was offset by $293 million in free cash flow, which is operating cash flow minus capital expenditures.
The company said it sold about 10% of its $1.5 billion bitcoin stake, making about $101 million. Tesla said it has sufficient liquidity to fund its new products and factory growth.
CEO Elon Musk got $299 million during the quarter for hitting market value and operational milestones, the company said.
Tesla said that over a “multi-year horizon,” it expects vehicle deliveries to grow on average by 50% per year, with some years, like 2021, growing faster than others.
“The rate of growth will depend on our equipment capacity, operational efficiency and capacity, and stability of the supply chain,” the company said in its quarterly letter to investors.
Factories in Berlin and Austin, Texas, are on track to start producing this year, and the company said production of its Semi will start in 2021. Also, first deliveries of the new Model S should start shortly. Musk said.
The company said that ultimately it will use only cameras as sensors for its fully autonomous driving system, making radar unnecessary. Musk said the company is on its way toward using artificial intelligence to solve problems with its cars’ eight cameras.
The system is “like having eyes in the back of your head, the side of your head” that can process data “at a speed that is super-human.”
Even before eliminating radar, critics have said Tesla lacks laser sensors needed to do autonomous driving safely.
In the Texas crash, authorities in Harris County, Texas, said one man was found in the passenger seat, while another was in the back. They’re issuing search warrants in the probe, which will determine whether the Tesla’s Autopilot partially automated system was in use. Autopilot can keep a car centered in its lane, keep a distance from cars in front of it, and can even change lanes automatically in some circumstances.
Lars Moravy, Tesla’s vice president of vehicle engineering, told analysts that an inspection of the badly burned car found that the steering wheel was deformed, “so it was leading to a likelihood that someone was in the driver’s seat at the time of the crash.” He said all seat belts were found unbuckled.
He said an automatic steering function could not engage on the road where the crash happened.
Last week Musk wrote on Twitter that data logs “recovered so far” show the Tesla in the Texas crash did not have Autopilot turned on, and “Full Self-Driving” was not purchased for the vehicle. The company has said despite the name Autopilot, it is a driver-assist system and drivers must be ready to take over at any moment.
The National Highway Traffic Safety Administration and the National Transportation Safety board sent teams to investigate the crash.
Critics have said that Tesla’s system for monitoring drivers to make sure they’re paying attention is easily fooled. Consumer Reports last week was able to trick a Tesla into driving on Autopilot with no one in the driver’s seat.
DETROIT (AP) — By TOM KRISHER AP Auto Writer
Microsoft pledges to let EU users keep data inside bloc
Microsoft is pledging to let business and public sector customers in the European Union keep cloud computing data inside the 27-nation bloc to avert concerns about U.S. government access to sensitive information.
Microsoft “will go beyond our existing data storage commitments and enable you to process and store all your data in the EU,” said Brad Smith, the U.S. technology giant’s president.
“In other words, we will not need to move your data outside the EU,” Smith wrote in a blog post Thursday.
Microsoft is responding to customers that want stronger commitments on so-called data residency, Smith said. The updates will apply to the company’s core cloud services including Azure, Microsoft 365, and Dynamics 365.
Transatlantic data protection has been a growing concern since the European Union’s top court struck down a data sharing agreement last year known as Privacy Shield. The court said the agreement, which allowed businesses to transfer data to the U.S. under the EU’s strict data privacy rules, was invalid because it didn’t go far enough to prevent the American government from snooping on user data.
Microsoft, which operates data centers in 13 European countries including France, Germany and Switzerland, will challenge any government request for an EU public sector or commercial customer’s personal data when there’s a lawful basis for doing so, Smith said.
Public transit hopes to win back riders after crushing year
Taking the Los Angeles Metro for his first trip in months, Brad Hudson felt a moment of normalcy when the train rolled into the station in South Pasadena, California, harkening back to his daily commute into LA before the coronavirus pandemic.
Then Hudson boarded the train, and reality set in.
Not everyone wore masks. Metro staffing levels appeared much lighter. There was more trash on the trains. He worried about security.
As President Joe Biden urges more f ederal spending for public transportation, transit agencies decimated by COVID-19 are trying to figure out how to win back passengers.
It’s made more urgent by the climate change crisis. Biden has pledged to cut U.S. greenhouse gas emissions at least in half by the end of the decade. That aggressive target will require Americans to ditch gas-guzzling cars for electric vehicles or embrace mass transit.
“We have a huge opportunity here to provide fast, safe, reliable, clean transportation in this country, and transit is part of the infrastructure,” Biden said at an event Friday to promote rail and public transportation.
With fewer transportation alternatives, lower-income people are more reliant on public transportation for commuting and their daily lives.
Los Angeles Mayor Eric Garcetti promises free transit fares for them and for students. The city’s Metro ridership has fallen to about half its peak of 1.2 million, and Garcetti said getting more people on board would accelerate economic recovery “for our most vulnerable” and reduce traffic and emissions.
In Washington D.C., where many federal employees now telework due to COVID-19 restrictions, transit officials are mulling lowering fares. New York City has deployed several hundred additional police officers in recent months after a series of subway attacks. The Chicago area is looking at rejiggering train schedules to accommodate more passengers traveling throughout the day, part of a pandemic shift from traditional 9-to-5 work days. Houston is pledging improvements to 17 of its higher-frequency bus routes, including adding brightly lit sheltered stops with digital arrival information.
Biden’s $2.3 trillion infrastructure plan would provide $85 billion over eight years to update and replace subway cars and repair aging tracks and stations; of that amount, $25 billion would go to expanding bus routes and rail lines. Another $25 billion would pay to convert gasoline- and diesel-powered mass transit buses to zero-emission electric vehicles.
Congressional Republicans are balking at the price, as well as Biden’s plan to increase corporate taxes to pay for it. A Senate GOP counteroffer proposes $568 billion for infrastructure, resulting in cuts to public transit funding.
A year ago, transit ridership drained to almost nothing as tens of millions of Americans stayed home and shunned trains and buses. To stay afloat, transit agencies cut payroll and slashed services.
Three rounds of nearly $70 billion total in federal COVID-19 emergency assistance pulled transit agencies from the brink of financial collapse. That federal aid is now expected to cover operating deficits from declining passenger revenue and COVID-19 cleaning and safety protocols through at least 2022.
Still, even as vaccinations become more widespread, it’s uncertain how many riders will come back.
Work-from-home arrangements initially seen as temporary appear to be a more durable trend. Transportation alternatives such as Uber and Lyft ride-share programs — and bike shares and scooters, not to mention driverless cars — threaten to eat away at transit ridership. Some city-dwellers have moved away.
Transportation officials say a key to increasing ridership will be employers reopening offices. Even so, it could take years to get all riders back, if ever, putting lower-income workers at a greater disadvantage if levels of service drop off.
In the Chicago area, transit ridership was down 71% in March compared with the same time in 2020, according to the Regional Transportation Authority.
Those who continue to rely on public transportation are mostly Black, Latino and low-income workers. For that reason, the Chicago Transit Authority, which runs 24 hours, didn’t cut routes or service even as ridership plunged.
“We recognized that we’re carrying primarily essential workers who relied on and needed to use public transit to carry out their functions on a daily basis,” said CTA President Dorval Carter.
Although empty train cars are common in some parts of the city, 34-year-old Ryan Patrick Thomas says Chicago’s Green Line trains connecting the south and west sides to downtown remain busy. Sometimes it’s standing room only.
Thomas, who’s Black, says train cars that used to have mixed crowds are now mostly Black, noting the virus has disproportionately hit people of color.
“These trains seem to be just as full of people in more vulnerable demographics,” he said.
New York’s subway system lost billions in revenue and more than 90% of its riders at the height of the pandemic; also about 150 employees who died of COVID-19. The Metropolitan Transportation Authority has spent hundreds of millions on disinfecting train cars and the system’s nearly 500 stations, even taking the unprecedented move of shutting the system down overnight; it remains closed between 2 a.m. and 4 a.m.
Subway ridership remains down close to 70%, though it continues to rise gradually. There’s a slower recovery on the Metro-North and Long Island Rail Road lines that serve the suburbs, where many white-collar workers have the option of working from home.
More than $14 billion in federal aid has put the agency on sound fiscal footing until mid-2024, MTA Chairman Patrick Foye said.
“If we can’t get people back in the next couple of months, it’s going to be harder to get them back in the future,” said Sarah Feinberg, interim head of New York City Transit, which runs subways and buses.
The Biden plan would invest $621 billion to modernize transportation infrastructure. Projects in the pipeline likely stand to gain the most, including a planned extension of the Bay Area Rapid Transit rail system to San Jose and Santa Clara, California; bus rapid transit lines in St. Paul, Minnesota, Charleston, South Carolina, and Las Vegas; and New York City’s long-awaited Second Avenue subway line.
There’s also Atlanta’s proposed $5 billion upgrade of its transit system, including light rail for its Beltline; and a $7.1 billion transit expansion in Austin, Texas, approved by voters in November, featuring new rail and rapid bus routes connecting downtown to suburbs, an all-electric bus fleet, on-demand shuttles and park-and-ride facilities.
WASHINGTON (AP) — By HOPE YEN, CHRISTOPHER WEBER, SOPHIA TAREEN and DAVID PORTER Associated Press..
Weber reported from Los Angeles, Tareen from Chicago and Porter from New York. AP writers Juan Lozano in Houston and Ashraf Khalil in Washington contributed.
Biden pushes for diversity in transition to clean energy
As the nation pushes to reduce its reliance on fossil fuels and use cleaner energy sources, President Joe Biden’s administration says it wants to ensure diversity among the communities that benefit from the transition and the people who are hired to do the work.
The administration says it wants more solar arrays erected in communities that have suffered from pollution caused by fossil fuels. It’s also directing research grants and opportunities to students and faculty members at historically Black colleges and minority-serving institutions.
The Department of Energy on Tuesday announced $15.5 million in new funding to deploy solar energy in underserved communities and to build a more diverse, skilled workforce to help reach the administration’s ambitious goal of 100% clean energy by 2035.
Another $17.3 million, announced Monday, was awarded for internships and research opportunities designed to connect students and faculty in science, technology, engineering and math with resources at the Department of Energy’s National Laboratories.
Biden has set a goal that 40% of overall benefits of federal climate and clean-energy investments goes to disadvantaged communities.
“This administration is really committed to making the transition to clean energy an inclusive transition, offering benefits to every community, because not every community has benefited up to this point,” Energy Secretary Jennifer Granholm said in a discussion at Howard University, a historically Black college, Monday. “In fact, some communities, particularly communities that are indigenous and Black and people of color, have disproportionately been negatively affected by pollution, and so we want to make sure that voices are at the table that are representative of communities who can benefit from this transition.”
Historically Black colleges have faced unequal access to federal funding for research, Granholm said.
The problem stems from inequities in research infrastructure such as grants and personnel to administer them, as well as access to top laboratories at some of the historically Black colleges, said Kim Lewis, associate dean for research, graduate programs and natural sciences at Howard University.
“For example, not having state-of-the-art research laboratories could prevent or minimize faculty members from getting or obtaining preliminary data to demonstrate a proof of concept that’s needed to compete for these research funds,” Lewis said.
Many faculty members also have a heavy teaching workload, and there may be implicit bias during the review process, she added.
Data shows that the U.S. needs diversity in science, technology, engineering and math, and “it’s a huge priority for the Biden administration,” Granholm said.
The Energy Department under Biden has awarded research grants to students and faculty from 57 institutions — nearly half of which were minority-serving institutions — to collaborate with staff from the department’s National Laboratories this summer.
The solar funding announced Tuesday will provide free technical assistance to communities to streamline the process for installing solar. That, in turn, helps attract investment and lowers energy costs for consumers.
The Energy Department is also planning a series of meetings with environmental-justice organizations, government leaders, solar developers and others to talk about how to address energy challenges in underserved communities.
“We’re willing to use the force of federal contracting and policy incentives to achieve greater diversity in hiring and equity in pay,” Granholm said in a discussion with solar industry stakeholders Tuesday.
When a large array of solar panels and batteries was built to provide power to a predominantly Black community in Chicago, it was important to hire Black, Hispanic and local workers, said Van Vincent, president and CEO VLV Development, which built the array.
“It’s going to take a collaborative effort,” Vincent said in the discussion Tuesday. “There is no silver bullet … there needs to be a commitment to including the people who live in the communities.”
NEW YORK (AP) — By CATHY BUSSEWITZ Business Writer.
AP Writer Matthew Daly in Washington contributed to this report.
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