Tesla’s Tumble
Tesla’s investor confidence has been shattered by shattered glass. After a demonstration gone wrong at the unveiling of the Tesla Cybertruck, the EV automaker saw its stock plummet more than 6 percent.
Last Thursday, the less-than-grand unveiling of the Tesla Cybertruck received disastrous reviews after a live demonstration of the vehicle’s space-age glass saw a ball hurled at–and then part-way through–one window, and then another.
Prior to the Cybertruck’s premiere, Tesla stocks closed at 354.83 on Thursday afternoon. On Friday, share prices took a dive—likely as a result of the shaky debut—closing at 333.04, down 6.1 percent from the previous close.
The Cybertruck has been a long-awaited addition to the Tesla lineup, as it represents the automaker dipping its toes into one of the most profitable corners of the U.S. auto market, as pickup trucks account for one in every six cars sold in the United States.
However, the launch has not been deemed a smashing success—the truck features Tesla Armor Glass, or what CEO Elon Musk calls “metal transparent glass.” When the Tesla team went to demonstrate the glass’ power, the truck’s windows shattered in front of the crowd.
“For a weird little reason, it broke now and I don’t know why,” Musk told the crowd, waving it off. “We’ll fix it in post.”
The tumultuous unveiling appears to have done little to inspire confidence in the pickup—while Tesla’s stock is recovering from Friday’s 6 percent slip, Musk also suffered some financial consequences as a result of the launch.
In a single day, Musk’s net worth—which stood at more than US$24.3 billion—dropped by a whopping US$768 million. As of Monday, Musk has a net worth of US$23.6 billion.
On Sunday, Musk tweeted that there had been more than 146,000 Cybertruck orders so far—a feat achieved without any advertising and no paid endorsements, he bragged.
The Cybertruck will retail for just under US$40,000 and production is scheduled to begin in 2021.
General Mayhem
General Motors is suing Fiat Chrysler Automobiles over alleged unfair business advantages involving the bribing of officials of the United Auto Workers (UAW) union.
The lawsuit alleges that FCA instigated a “multi-year pattern of corruption” by paying millions in bribes to UAW union officials in order to receive concessions and gain various advantages in three different labour agreements with the UAW. An exact amount has not been disclosed.
GM’s suit states that FCA—specifically the late CEO Sergio Marchionne, who passed away last year—illegally funnelled millions of dollars to senior UAW officials in charge of the union’s relationship with Chrysler. It says these bribes ensured FCA received “benefits, concessions, and advantages in the negotiation, implementation, and administration of the labour agreements over time” and applies to the 2009, 2011 and 2015 union contracts.
“Many of the advantages FCA was able to obtain were denied to GM,” said Craig Glidden, chief counsel for GM. “That was part of the conspiracy.”
GM alleges that, in the three UAW contracts, FCA was able to reduce its labour costs because the union allowed it to hire more temporary and lower-paid workers than GM.
FCA issued a statement following the suit.
“We are astonished by this filing, both its content and its timing,” reads the statement. “We can only assume this was intended to disrupt our proposed merger with PSA as well as our ongoing negotiations with the UAW.”
Glidden said GM is seeking substantial damages, but declined to give a specific amount.
Uber Unter
Ride-sharing giant Uber could be facing future financial losses, as the company has lost its licence to operate in London, U.K.
Monday’s premarket trading saw Uber’s stock dip by 6.3 percent, resulting in $3 billion being sliced off of the $50.4 billion market cap the company closed with on Friday.
The plunge is being blamed on the London city regulator’s refusal to renew Uber’s licence, citing “a pattern of failures” by the service that puts passengers’ safety at risk.
The regulator maintained that fraudulent drivers had completed more than 14,000 trips—all uninsured, and one driver had even had his license previously revoked by the company. There were also lax limitations on driver suspensions—drivers were easily able to make a new account and continue driving for Uber.
While Uber had taken steps to fix the issues in London, the regulator says it remains “a concern that Uber’s systems seem to have comparatively easily manipulated.”
Uber’s London licence expired today, Monday, Nov. 25, but the company has 21 days to appeal the decision.
