Tesla takes a nuts-and-bolts approach to 2022

After a banner year for the electric vehicle manufacturer, in which the company broke all kinds of delivery, revenue, and profit records, Tesla CEO Elon Musk pumped the brakes Wednesday evening on some of the company’s lofty goals.

Tesla no longer plans to introduce its Cybertruck model in 2022 and the company is “not currently working” on a proposed $25,000 car, Musk confirmed during a fourth-quarter earnings call.

Instead, Musk said, the company will focus on ramping up production of its existing models, an effort hampered by supply chain shortages expected to persist throughout the year. He expects Tesla will easily exceed its oft-stated goal of a 50% year-over-year increase in vehicle deliveries, even as delays continue to hamper the completion of a new German plant.

The strategy shouldn’t necessarily come as a surprise following Tesla’s success in 2021. 

The company’s annual profit jumped from about $720 million to $5.5 billion, more than the combined losses Tesla endured in its first nine years as a public company. Year-over-year deliveries jumped from about 500,000 to 936,200, even as existing plants ran below-capacity due to the supply challenges. 

Meanwhile, legacy automakers are ramping up their efforts to catch up with Tesla, pledging tens of billions of dollars in EV investments over the next decade.

“The fundamental focus of Tesla this year is scaling output,” Musk said. “Both last year and this year, if we were to introduce new vehicles, our total vehicle output would decrease. This is a very important point that I think a lot of people do not understand.”

While Tesla’s core vehicle business is booming, the future of Tesla’s additional models and other technological ventures remains murky.

Tesla engineers will continue to tinker with the Cybertruck model, with an eye on 2023, Musk said. However, it’s worth remembering that Tesla originally planned to start producing the Cybertruck in late 2021.

Musk also predicted Wednesday that Tesla “will achieve full self-driving this year at a safety level significantly greater than a person”—yet he’s made woefully misguided predictions before about Tesla’s timeline for developing the technology. 

Musk has given us little evidence to suggest this time will be different, and a New York Times report last month on safety and regulatory issues afflicting Tesla’s Autopilot feature did little to inspire confidence.

And who knows about the far-off Optimus humanoid robot prototype, which left Musk most animated on Wednesday’s call. (“Our most important project,” he said.)

While it’s certainly not in Musk’s nature to spurn futuristic dreaming, Tesla already has a good thing going in the here-and-now. Building out capacity might not be sexy, but it sure can be profitable.

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Jacob Carpenter

NEWSWORTHY

No assembly required. Small businesses will soon be able to take payments on their iPhones without needing extra hardware, a feature from Apple that could cut into the business of mobile payment companies, Bloomberg reported Wednesday. The new technology, which could arrive in the coming months, likely would tap into an iPhone chip currently used for Apple Pay. It’s not yet clear whether Apple will allow third-party payment processors, such as Block unit Square, to gain access to the technology, or if the iPhone maker will limit the feature to its Apple Pay feature.

A crypto fire sale. The Diem Association, a Meta-backed consortium that aimed to bring a novel cryptocurrency to market, will sell off its technology to a small California bank for about $200 million, The Wall Street Journal reported Wednesday. The news follows a Bloomberg report Tuesday about the imminent demise of Diem, which Meta CEO Mark Zuckerberg championed as a more-portable alternative to currency controlled by central and commercial banks, amid resistance from U.S. financial regulators. Silvergate Capital, which planned to issue Diem’s coin, will take ownership of intellectual property. 

COVID and the damage done. Spotify agreed Wednesday to remove the catalog of Neil Young from its streaming service, acquiescing to the folk-rock singer’s request made earlier this week, The Wall Street Journal reported. Young asked Spotify to stop offering his music because the streamer continues to host podcasting star Joe Rogan, who has voiced skepticism about aspects of the COVID-19 vaccines and promoted a guest last month who spread conspiracy theories related to the virus. Young said Spotify accounts for about 60% of the streaming of his music.

Back in business. Samsung posted its highest fourth-quarter profit in four years, largely on the back of strong chip sales amid the global semiconductor shortage and a small bump in mobile phone business, Reuters reported Thursday. The South Korean company’s operating profit topped $11.6 billion, up 53% from the prior year’s fourth-quarter, with its chip business accounting for nearly two-thirds of the total profit. Still, Samsung’s stock fell 2.7% on the South Korean market after missing analysts’ profit estimates.

FOOD FOR THOUGHT

The smart EV future. While Tesla understandably gets attention for its consumer electric vehicles, the biggest developments in the EV sector could come on the commercial side. Axios’ Joann Muller wrote Thursday that automakers see enormous potential in mixing electric-vehicle technology with cloud-based software, with Ford leading the way to date. The blend helps companies get good PR from going green on the road, while also giving them more information about the location and performance of their fleets.

From the article:

Businesses like farmers, contractors and delivery companies—not individual consumers—will lead America into the electric vehicle era, judging from how demand is currently shaping up.

Why it matters: While consumers are waiting on the sidelines to see if the charging infrastructure improves and prices come down, commercial businesses see EVs as a way to boost their productivity and improve operations.

EV fleets connected to the cloud are like distributed computer networks—chock full of data, which is good for business.

IN CASE YOU MISSED IT

Wall Street and Big Tech are pouring money into a metaverse ‘arms race’ that could be worth trillions, by Bernhard Warner

Inside Neuralink, Elon Musk’s mysterious brain chip startup: A culture of blame, impossible deadlines, and a missing CEO, by Jeremy Kahn and Jonathan Vanian

Elon Musk’s SpaceX rocket trash is about to hit the moon, by Sophie Mellor

4 ways to survive the crypto bear market, by Amiah Taylor

‘Antiwork’ Reddit forum temporarily shuts down due to ‘brigading’ attack that followed fiery Fox News interview, by Grady McGregor

Netflix shares rebound after well-known investor Bill Ackman takes a big stake, by Sebastian Tong and Bloomberg

A man who turned 10,000 cartoon dogs into an $85.4 million NFT collection offers best tips for creating hit digital art, by Amiah Taylor

BEFORE YOU GO

On the open streams. Internet pirates sure like their sci-fi and action heroes. A new report from content delivery network Akamai shows the two genres dominated illegal streaming of movies and television in the first nine months of 2021, when there were 79 billion visits to piracy websites. The top films: Godzilla vs. Kong, Zack Snyder’s Justice League, Black Widow. The top shows: Loki, WandaVision, Rick and Morty.