US lawmakers begin push to expand federal electric vehicle tax credits

How taxpayers have boosted Elon Musk and Tesla
10:06 AM ET Mon, 22 Oct 2018 | 07:43

A bipartisan group of lawmakers plans to introduce a bill to expand federal tax credits for buyers of electric vehicles, in what could be a boon for the growing EV market.

The existing $7,500 tax credit for buyers of EVs phases out over 15 months once an automaker sells 200,000 electric cars. The tax credit for Tesla buyers was halved to $3,750 on Jan. 1; General Motor's tax credit was likewise cut in half starting April 1.

The bill, dubbed the Driving America Forward Act, would grant each automaker a $7,000 tax credit for an additional 400,000 vehicles after it exhausts the first 200,000 vehicles eligible for tax credits. It would shorten the phase-out schedule to nine months. The credits are paid directly to consumers, who can write them off on their tax returns.

“At a time when climate change is having a real effect on Michigan, today's legislation is something we can do now to reduce emissions and combat carbon pollution,” Sen. Debbie Stabenow, D-Mich., one of the sponsors of the legislation, said in a statement. “Our bill will help create American jobs and cement Michigan's status as an advanced manufacturing hub.”

Tesla shares rose 1.6 percent in morning trading Wednesday on the news.

Sens. Gary Peters, D-Mich., Lamar Alexander, R-Tenn., and Susan Collins, R-Maine, and Rep. Dan Kildee, D-Mich., signed on to the bill.

Tesla dismisses sales employees as part of earlier-announced cuts
4:18 PM ET Mon, 8 April 2019 | 01:07

Electric vehicles comprise a tiny, but growing, share of the U.S. vehicle market. Support for low- and no-emissions vehicles has grown both in the U.S. and in other major automotive markets, such as China. Though Tesla has been a market leader in EVs, several automakers are planning to release fully electric cars, trucks and SUVs over the next few years.

“This would be a major shot in the arm for Tesla as this could be a much needed potential catalyst for demand in the U.S.” said Wedbush analyst Dan Ives. “Ultimately, while there are still hurdles to get this legislation passed, it would result in an additional 40,000 Tesla vehicles sold domestically in 2019 based on our estimates. After a tornado of bad news the last few months this would finally be a positive data point for Musk & Co.”

— CNBC's
Phil LeBeau
and Meghan Reeder contributed to this article. Reuters also contributed to this report.

Lyft shares should only be worth $59 according to valuation guru

Mario Tama | Getty Images
Confetti falls as Lyft CEO Logan Green (C) rings the Nasdaq opening bell celebrating the company's initial public offering (IPO) on March 29, 2019 in Los Angeles, California.

When Lyft went public on March 29, it was valued at more than $20 billion, with shares priced at $72. Lyft shares have since declined and closed below the IPO price at $70.23 today, in part because of investors' worries over its nearly $1 billion in losses last year, and its high valuation.

The ride-hailing company should be trading closer to $59 per share, and valued closer to $15 billion, according to Aswath Damodaran, who teaches corporate finance and valuation at the Stern School of Business at New York University. That would imply about a 16% drop from today.

On CNBC's Fast Money, Damodaran explained there's fundamental problem with Lyft's business model that may have helped the company grow fast, but makes it hard for the company to make money:

“The driver is a free agent. The customer is a free agent. There is absolutely no stickiness in the business, and they know it. That's the basic problem I have with the ride-sharing business not just Lyft. What they have succeeded at is changing the way we use car service. I have Uber and Lyft on my phone and I never take a cab. What they haven't figured out is how to make me stay with them. I'm completely disloyal here. Same thing with drivers.”

At least Lyft is focused, and not committed to expensive, risky side projects like Uber, Damodaran noted.

Uber recently spent $3.1 billion to acquire Careem, a ride hailing business that serves passengers in the Middle East. Uber also spent money to set up a research and development division, Uber ATG, that is working on everything from self-driving car technology to air taxis.

By contrast, Lyft is primarily focused on maintaining and growing its marketshare in North America.

Damodaran said: “I'd take Lyft over Uber because Uber wants to be all things to all people. You'd think they'd learn from their mistakes. They tried in China and had to back out of China. I think being less ambitious in this business, until you figured out a business model, is better.”

Lyft's IPO kicked off a so-called “unicorn stampede,” or string of public market debuts expected this year from tech companies that have raised copious amounts of venture capital and are privately valued over $1 billion. Among those expected to go public later this year are Uber, which was privately valued at $72 billion last year; Pinterest, which is aiming to go public at a valuation of up to $9 billion; and Slack privately valued at $6.7 billion.

They should learn from Lyft's experience, and from predecessors like Snap, the business school professor suggested.

“You don't want to go up against Facebook and Google. Create a niche and be in it,” Damodaran said. “The mistake that Snap made, which Pinterest should not, is they thought they could be bigger than Facebook.”

Nissan’s Ghosn says in a video that he’s innocent and a victim of a conspiracy

Issei Kato | Reuters
A video statement made by the former Nissan Motor chairman Carlos Ghosn is shown on a screen during a news conference by his lawyers at Foreign Correspondents' Club of Japan in Tokyo, Japan April 9, 2019.

Ousted Nissan Motor boss Carlos Ghosn said he was innocent of all the charges against him and was the victim of a conspiracy, according to a video recorded before his arrest last week and broadcast by his lawyers on Tuesday.

Prosecutors took the highly unusual step of re-arresting Ghosn last week on fresh allegations that he used company funds to enrich himself to the tune of $5 million. The once-feted executive had been out on $9 million bail for 30 days, during which he recorded the video screened by his lawyers on Tuesday.

In the video, shown to reporters in Tokyo, the former Nissan Motor Co chairman said he was the victim of selfish rivals bent on derailing a closer alliance between the Japanese automaker and French partner Renault SA.

Ghosn called out some individuals by name in the video but those references were removed due to legal concerns, his lead lawyer Junichiro Hironaka told reporters.

The video – together with Hironaka's comments alleging harsh treatment by Tokyo prosecutors against Ghosn and his wife, Carole – cast Ghosn as the victim of both internal rivals and the Japanese judicial system.

“This is a conspiracy … this is not about greed or dictatorship, this is about a plot, this about a conspiracy, this is about a backstabbing,” Ghosn said in the video.

He was wearing a dark jacket and a white shirt. His hands were folded in front of him as he looked into the camera and spoke in a clipped, matter-of-fact manner. His hair appeared to be greyer and his face thinner than before last year's arrest.

The conspiracy, he said, was borne out of fear that he would bring Nissan closer to its partner and top shareholder, Renault.

“There was fear that the next step of the alliance in terms of convergence and in terms of moving towards a merger, would in a certain way threaten some people or eventually threaten the autonomy of Nissan,” he said.

Physical, mental pressure

Hironaka told the briefing that prosecutors were acting in a “cruel way” and putting him under intense physical and mental pressure to get a confession.

Prosecutors were not immediately available for comment.

Hironaka has previously criticised the move by prosecutors to confiscate Ghosn's belongings, including his mobile phone and trial documents, along with the mobile phones and Lebanese passport of his wife, Carole, who was present when prosecutors entered their home early in the morning last Thursday.

The lawyer said on Tuesday that Ghosn's wife, who left Japan last week, did so out of concern for her own safety, adding she intended to protest the case to the French government.

However, France's finance minister said on Tuesday that political interventions might not be the best way to help Ghosn, raising some questions about how much pressure Paris was willing to put on Tokyo over the issue.

The case has rocked the global auto industry and also shone a harsh light on Japan's judicial system.

Under Japanese law, prosecutors are able to hold suspects for up to 22 days without charge and interrogate them without their lawyers present.

Such procedures have focused much attention in the West on Japan's judicial system, which critics sometimes refer to as “hostage justice”, because defendants who deny their charges are often not granted bail.

Ghosn has been charged with under-reporting his Nissan salary for a decade, and of temporarily transferring personal financial losses to Nissan's books. However, the new, $5 million allegation is potentially more serious, as it could show he used company funds for his own purposes.

On Monday, Nissan shareholders ousted him as a director, severing his last tie with the automaker he rescued from near-bankruptcy two decades ago.

7201.T

Ford, GM and Toyota set up a safety group for self-driving cars

Malorny | Moment | Getty Images
Aerial view, view from above, drone view, or birds eye view of a highway at night.

Ford, General Motors (GM) and Toyota, together with SAE International, have established a new consortium that will focus on the safety of autonomous vehicles.

In a statement Wednesday, SAE International, a global association of engineers, said the Automated Vehicle Safety Consortium (AVSC) would work “to safely advance testing, pre-competitive development and deployment of SAE Level 4 and 5 automated vehicles.”
SAE International has defined five “levels” of driving automation, with the highest being where a vehicle's automated features can drive itself under all conditions.
“We understand that autonomous vehicles need to operate safely and reliably in concert with infrastructure and other road users to earn the trust of the communities in which they are deployed,” Randy Visintainer, chief technology officer at Ford Autonomous Vehicles, said in a statement.
“Our goal with the consortium is to work with industry and government partners to expedite development of standards that can lead to rule making,” Visintainer added.

The executive director of the newly formed AVSC, Edward Straub, said that being able to advance the safe deployment of level four and level five vehicles represented “another exciting chapter in the realization of autonomous mobility and the benefits this will bring to people around the world.”
“To achieve these benefits, industry collaboration, cohesion and flexibility to merge new ideas with proven safety processes are critical,” Straub added.

While there is excitement surrounding the potential of autonomous vehicles, concerns have been raised with regards to safety. In March 2018, for example, one of ride-hailing powerhouse Uber's autonomous vehicles killed a pedestrian in Tempe, Arizona.

When it comes to regulation, there are also a host of questions to be answered. “There are no rules right now, international rules, on how to regulate automated vehicles,” Philippe Crist, from the International Transport Forum, told CNBC in January 2018.

“The safety regulation of automated vehicles will have to be the same as for regular vehicles, using the same principles,” Crist added.

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Ford sales fall 1.6% due to unpopular cars, but truck, vans and SUVs gain

Tim Boyle | Getty Images
Shoppers at a Ford dealership in Schaumburg, Illinois.

Ford's first-quarter sales fell 1.6% from a year earlier, but sales of trucks, vans and sport utility vehicles grew, the company said Thursday.

A 24.1% decline in sales of ever less-popular passenger cars dragged down what was otherwise a positive quarter for the nation's second-largest automaker.

Ford's premium Lincoln brand grew sales 11.2%, making it Lincoln's best first quarter in ten years. Ford brand SUV sales set a first-quarter record.

It's more evidence that vehicle sales in the world's second-largest auto market are sliding from the record levels they had achieved in the years following the financial crisis.

U.S. retail auto sales, which exclude sales to rental car companies and other commercial businesses, are expected to drop by about 5%during the first quarter, according to J.D. Power and LMC Automotive.

While sales volumes are softening, especially for cheaper cars, customers are still paying remarkably high prices for cars, said Thomas King, senior vice president of J.D. Power's data and analytics division. Prices are hitting monthly records while overall retail sales of vehicles that cost under $25,000 are expected to fall 12% in the U.S. in the quarter, more than double the overall decline.

That rang true for Ford, which saw demand for its more expensive trucks and SUVs tick up during the quarter. Sales of Ford's pickup trucks, vans and SUVs, including Lincoln SUVs, made up 83% of the company's total vehicle sales during the quarter.

Pickups alone, led by its popular F-150 line, accounted for almost half of Ford's total volume with the average sales price of $47,454, the company said.

“Customers continue to choose high series and the latest technologies,” Ford said.

Ford truck and SUV sales rose 4% and 3.5%, respectively, while Lincoln SUV sales jumped by 23.2%.

US judge gives Tesla CEO Elon Musk, SEC two weeks to work out their issues

Tesla CEO Elon Musk just squared off with the SEC in court
12:33 PM ET Fri, 5 April 2019 | 01:49

A federal judge gave Tesla CEO Elon Musk and the Securities and Exchange Commission two weeks to work out their differences, punting a request from the agency to hold him in contempt of court for allegedly violating an October securities fraud settlement.

Musk told reporters he was “happy” and “impressed with the judge's analysis” as he left the hearing room in the U.S. District Court for the Southern District of New York on Thursday.

U.S Judge Alison Nathan said she had “serious concerns that no matter what I decide here, this issue won't be resolved.” Nathan ordered both parties to “take a deep breath, put on your reasonableness pants” and work out a solution.

Musk was at the hearing on contempt charges requested by the SEC after he tweeted about the company's production forecasts on Feb 19. His settlement agreement prohibits him from using Twitter to make statements about Tesla's operations or financial position without company review and approval.

Nathan told Musk and the SEC that contempt charges are serious business. Everyone must follow the law, she said, whether you are a “small potato” or a “big fish.”

Musk told reporters outside the courthouse that he would “most likely” be able to work out an agreement with the SEC over the next two weeks.

Natan Dvir | Bloomberg | Getty Images
Elon Musk, chief executive officer of Tesla Inc., smiles while speaking to members of the media outside federal court in New York, U.S., on Thursday, April 4, 2019.

“I have great respect for the justice system and I think the judges in the American system are outstanding,” Musk said before entering the courthouse in lower Manhattan.

When CNBC's Phil LeBeau asked Musk if he felt the same about the SEC, the CEO laughed and walked away.

SEC lawyers argued that Musk and his legal team offered a “series of shifting justifications” for his behavior on Twitter, citing 15 separate tweets they believe violated his settlement. They also accused Musk of “recklessly tweeting out material information that had no basis in fact” and caused confusion in the markets.

“We don't think every tweet needs to be approved,” SEC attorney Cheryl Crumpton told the court, citing conversations on social media with Tesla customers as OK.

Statements much beyond that need to be cleared, she said.

Reaffirming guidance could be material and needs approval, she said, adding that Tesla still “appears to be unwilling” to exercise control over Musk.

Musk's lawyers said the judge's order was a gateway to a negotiation with the SEC.

“He actually does what he is told,” Musk's lead attorney John Hueston told the court.

Musk sat in the center of the courtroom, flanked by three members of his legal team, periodically nodding in agreement with their arguments.

Securities lawyers and other industry executives have said that Musk, who has already been removed as chairman, could also lose his post as CEO if he keeps pushing the SEC.

Jeenah Moon | Bloomberg | Getty Images
Elon Musk, chief executive officer of Tesla Inc., center, arrives at federal court in New York, on Thursday, April 4, 2019.

“The court and SEC are in a bit of a bind here because capital punishment, if you will, would be … throwing him out of company or banning him from running any public company from now on for violating this agreement with the SEC,” Paul Ingrassia, Revs Institute for Automotive Research editor, said Thursday on CNBC's “The Exchange.” “He is viewed as being the essence of Tesla. It's his brainchild. He's not only the public figure but also the creative genius behind it.”

Tesla's shares plunged by more than 10% Thursday before recovering slightly to close down 8.2% after the company released its production and delivery data for the first quarter that missed Wall Street estimates and disappointed investors.

“At some point I think people have to start wondering would this company be better off with a calmer managerial presence in charge as opposed to a genius leader but a mercurial leader,” Ingrassia said. “Is the company now at that stage of its development? But Musk has so much of the shares himself that that's probably not going to happen without an SEC or court order, which I doubt they'll be willing to do.”

— CNBC's
Michelle Fox
contributed to this article.

Tesla's Elon Musk: 'I have great respect for the justice system'
1:45 PM ET Thu, 4 April 2019 | 00:52

Wall Street analysts say Tesla’s first-quarter deliveries were ‘substantially worse’ than expected

Tesla shares sink on poor deliveries — Watch four experts break down what's next for Elon Musk and the company
50 Mins Ago | 03:56

Wall Street analysts were very disappointed in Tesla's first-quarter delivery and production figures.

Shares of the company plunged 9 percent late Wednesday after Tesla said it delivered 50,900 Model 3 cars in the first quarter, below the 52,450 analysts expected in a consensus estimate from FactSet. Overall deliveries also fell short of consensus estimates.

The stock is still down over 9 percent in early trading to $265.35.

“Tesla's 1Q19 vehicle production & deliveries report was substantially worse than expected,” J.P. Morgan analyst Ryan Brinkman said in a note to clients.

“Altogether, we think the delivery results will put pressure on TSLA's shares, and corroborates our belief that volume expectations for the company's products in 2019 are too high with consumer demand likely lower as subsidies phase out in the US,” said Goldman Sachs analyst David Tamberrino who reiterated his sell rating. “Further, this likely puts downward pressure on our EBITDA and FCF estimates (as well as consensus) given the lower volume levels and worse utilization than anticipated.”

Here's what the analysts are saying about the Tesla delivery numbers:

J.P. Morgan- Underweight rating, lowering price target to $200 from $215

“Tesla's 1Q19 vehicle production & deliveries report was substantially worse than expected…Deliveries tracked just 63,000 units vs. JPM 70,500 and consensus as recently as March 27 of 74,930, suggesting materially less 1Q revenue, margin, and free cash flow… We believe the market postulated that if Tesla were to miss, it would be due solely to a materially greater than expected number of vehicles in transit (vehicles that could be sold in early 2Q, suggesting little need to lower full year estimates), but this appears to be only partly the case, with vehicles in transit at quarter-end totaling 10,600 vs. our estimate of 10,000, in our view implying lower underlying domestic demand…While most attention is being paid to the Model 3 ramp, deliveries of the higher price Model S & X declined substantially in 1Q, totally just 12,100 between them — less even than the Model S alone used to sell in some quarters preceding the full production ramp of the Model X, again in our view implying a deceleration in underlying demand unrelated to temporary delivery difficulties (maybe due to tax credit expiration?).”

Canaccord Genuity- Buy rating, lowering price target to $391 from $450

“While we were disappointed in the shortfall of deliveries in Q1 versus expectations, we continue to believe that the new lower-priced Model 3 variant will spur additional demand. Importantly, the company cited roughly two weeks of inventory in North America which may help temper concerns of an inventory build. We maintain our BUY rating given the overall opportunity that we see for Tesla and EVs in general, but are lowering our PT to $391 which is based upon 30x our new FY20 EPS of $13.05.”

Morgan Stanley – Equal-weight rating

“1Q19 is shaping up to be one TSLA may want to forget, but needs to explain to shareholders who own it as a LT disruptor. We felt the #1 2019 determinant for TSLA's share price was if it could prove to the mkt. it can be self-funding on a sustainable basis.”

Bank of America- Underperform rating

“Ultimately, given what appears to be slower than anticipated progress on the Model 3 production ramp, TSLA's past production/ logistics challenges on the Model S/X, and now potentially new challenges with deliveries to Europe and China, we expect it will take some time before the Model 3 production/sales reaches mass scale; and thus, costs related to the ramp and lower priced variants may outweigh potential benefits of operating leverage for some time. .. .Moreover, there still remain a number of major hurdles ahead for TSLA, including: 1) ongoing Model 3 production ramp and future operational challenges associated with expanding the product lineup; 2) what could be a very material cash burn in coming quarters (from ongoing delivery/logistic issues, Shanghai factory construction, etc.) which could pressure TSLA's liquidity even with recent capital inflows and require future capital raises; 3) faster than usual spike and burnout pattern for Model S/X; and 4) the prospect of new competition and longer term obsolescence. As such, we continue to question TSLA's longer term profitability, cash flow, and valuation.”

Goldman Sachs- Sell rating

“We think the disappointing results likely put pressure on consensus estimates for the full year especially for Model S/X deliveries (with company-compiled consensus for Model S/X deliveries at 91k and Model 3 at 282.5k versus an annualized rate of 1Q19 results indicating around 50k Model S/X deliveries in 2019 and 204k Model 3 deliveries). Further, we think the result likely fuels bearish investors' concerns about waning demand — especially as these disappointing results came even as the company expanded Model 3 deliveries internationally and began offering $35k variants of the Model 3. Altogether, we think the delivery results will put pressure on TSLA's shares, and corroborates our belief that volume expectations for the company's products in 2019 are too high with consumer demand likely lower as subsidies phase out in the US. Further, this likely puts downward pressure on our EBITDA and FCF estimates (as well as consensus) given the lower volume levels and worse utilization than anticipated. As a result, we reiterate our Sell rating on shares.”

Bernstein- Market-perform rating

“While we see myriad possible explanations for Model S and X weakness (reduction of US tax credit; phasing out of Dutch tax incentives; Q1 seasonality; model fatigue; incremental competition), we remain perplexed by the magnitude of the decline. Perhaps more importantly, our analysis suggests that non-in-transit inventory of S/X could be 15,000 – 20,000 units, or more than one quarter's demand. We found Model 3 deliveries less concerning, given (1) the high-end Model 3's unsustainably high U.S. market share in 2H 18 (33% of its segment) and (2) the invariable logistical bottlenecks that have emerged overseas (Tesla is now delivering 5x more cars internationally than it ever has before). We remain less worried about the key investor controversy of underlying Model 3 demand – our analyses suggest 400,000+ cars a year is very possible. We have lowered our estimates for S, X deliveries in 2019 to 68K from 80K, and expect Model 3 deliveries of 291K (vs. 295K). We forecast TSLA to use $1.1B in cash in Q1 (including $200M in restructuring expenses) and now model FCF of about -$200M per quarter in Q2 and Q3, and break-even in Q4 19. We model Tesla's Q1 ending cash balance at $1.7B. We believe that TSLA should have raised capital in the 2H18 and eschewed near-profitability to press its first-mover advantage & grow as quickly as possible in 19 and 20. It is now in the uncomfortable position of likely needing to raise capital from a position of relative weakness.”

Citi- Sell/High Risk rating

“Though Tesla bulls might look past the Q1 Model 3 miss, the S/X numbers will likely spark some legitimate demand & company margin concerns, particularly given the risk for some incremental cannibalization from the recently introduced Model Y. We expect the stock to come under pressure on this and perhaps test recent lows—maintain Sell/High Risk. A few implications from here: (1) First, it's setbacks like these that underscore the need for greater balance sheet cushion—after all Tesla's quarterly financial DNA now resembles far more “auto” than “tech”. Tesla noted that it had “sufficient” cash to end Q1, but we doubt the word “sufficient” will inject much comfort; in fact it might even draw more scrutiny to Tesla's balance sheet issues, in our view. (2) At the very least, Q1 deliveries will likely cause the bull camp to revisit assumptions about the NT demand trajectory. Tesla confirmed its 2019 delivery targets, which of course now look quite aggressive requiring ~100k deliveries on average in each remaining quarter. So demand will likely be scrutinized even more so, and the outcome in the coming months could meaningfully re-shape the entire Tesla bulls/bear debate.”

Baird- Outperform rating

“Model 3 deliveries were in line with our expectations but Model S+X deliveries missed both our and consensus estimates; TSLA indicated lower-than-expected delivery volumes and pricing adjustments are expected to negatively impact net income in the quarter. Additionally, a high number of cars in transit at the end of the quarter could impact cash flow, though the company indicated it had “sufficient” cash on hand at quarter-end. TSLA also announced it will host an investor day on autonomous driving initiatives on April 19.”

This is a developing story. Check back for updates.

Volkswagen begins testing automated cars in Hamburg

Volkswagen

Volkswagen has commenced testing automated vehicles in Hamburg, Germany. The tests, being carried out by Volkswagen Group Research, will see five e-Golfs take to a three kilometer section of road in the major port city.
The vehicles have laser scanners, radars, ultrasonic sensors and cameras. Test drivers will be behind the car's steering wheel at all times to monitor performance and take control of the vehicle in case of an emergency.
Volkswagen said that computing power “equivalent to some 15 laptops” has been installed in the e-Golf's trunk.
This, in combination with sensor technology, will enable the vehicle to collate data on everything from cyclists and pedestrians to other cars, rights of way and intersections. A range of artificial intelligence techniques, including deep learning and pattern recognition, will be used.
“The tests center on technical possibilities as well as urban infrastructure requirements,” Axel Heinrich, who is head of Volkswagen Group Research, said in a statement Wednesday.
A 9 kilometer “digital test bed” for both connected and automated driving is being built in Hamburg. It is set to be finished in 2020. Traffic lights in the city are also being updated in order to facilitate infrastructure-to-vehicle and vehicle-to-infrastructure communication.
Heinrich added that, to make driving safer and more comfortable, “vehicles not only have to become autonomous and more intelligent – cities must also provide a digital ecosystem that enables vehicles to communicate with traffic lights and traffic management systems as well as with one another.”

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GM sales fall, but buyers clamor for trucks and SUVs

John Gress | Reuters
Trucks come off the assembly line at GM's Chevrolet Silverado and GMC Sierra pickup truck plant in Fort Wayne, Indiana, July 25, 2018.

General Motors reported first-quarter sales on Tuesday that fell 7 percent from a year ago but said buyers are flocking to its more expensive sport utility vehicles and pickup trucks.

Transaction prices, the final sales price, on the company's newest pickups rose $8,040 compared with the outgoing models in the same quarter of 2018, reflecting the continued interest among buyers for well-equipped trucks. More than 96 percent of the GMC Sierra crew cab pickup, a four-door full-size truck, were sold with more expensive high-end trims.

Signs have shown that new car sales are slowing in the United States. Yet demand for trucks and SUVs, which tend to be more profitable, could buoy automakers and somewhat offset the effects of a slowdown. Trucks, SUVs and crossovers made up 80 percent of GM's sales, the company said.

The company said sales of smaller crossovers such as the Chevrolet Trax and Equinox, as well as its midsize Chevrolet Colorado pickup, all set first-quarter sales records, while the GMC Acadia SUV had its best quarter ever.

GM plans to launch more full-size pickups in the second half of the year with two new heavy duty pickups from Chevrolet and GMC.

“We are bullish on pickups and expect to gain sales momentum throughout the year,” said Kurt McNeil, vice president of U.S. sales operations. “We are installing capacity in Flint to build more HD pickups in total, more crew cab models, more dualies and diesel models, too, all in response to dealer and customer demand.”

However, sales of traditional passenger cars continued to slide, dragging down the automaker's total.

General Motors has undertaken a plan to reshape its business, including idling factories that produce slow-selling sedans and compact cars and consequently cutting 14,000 jobs at factories in the U.S. and Canada. The move has divided opinion. Supporters say the company is taking the necessary steps to improve profitability, but labor leaders and politicians from affected regions have criticized the decision.

Shares of GM have risen 5.6 percent over the last 12 months and are up by nearly 13 percent since the beginning of the year.

America is falling back in love with trucks and SUVs, and that's causing big changes at big car companies
10:38 AM ET Tue, 5 Feb 2019 | 04:45

Autonomous vehicle tests underway in London

FiveAI

Supervised autonomous vehicle tests have started in two London boroughs, according to a statement published Tuesday.
FiveAI, which specializes in areas such as autonomous vehicles, machine learning and artificial intelligence, said the trials, in Bromley and Croydon, represented a “significant next step towards launching autonomous, shared services in London.” The firm added that passenger trials were due to start in 2020.
Five vehicles will be used in the testing and are set to be on the roads both day and night. Safety drivers will be in the vehicles at all times and have the ability to take control of the cars if necessary.
In preparation for the trials, FiveAI undertook data gathering exercises in August 2018. Vehicles were driven around streets to gather data on things such as road user behaviour and road layout. The vehicles that will be used in the forthcoming tests will be clearly marked to let other road users know they are autonomous.
“All cities across the U.K., including London, need to understand the opportunities, risks and challenges they face when considering how transport will operate in the future,” Michael Hurwitz, Transport for London's director of Transport Innovation, said in a statement Tuesday.
Hurwitz added that while the outlook for autonomous vehicle technology was still uncertain, it had “the potential to significantly change travel.”

Over the last few years, the development of technology has led to several trial runs of autonomous vehicles.

In August 2018, for example, the Hyundai Motor Company announced that the first journey by an autonomous truck on a South Korean highway had taken place. The firm's Xcient truck, which has a maximum load capacity of 40 tons, drove around 40 kilometers between Uiwang and Incheon.
The vehicle used an autonomous driving system that allowed it to accelerate, decelerate, steer and maneuver through traffic without needing input from a human, although one was on board to take control as and when required.
In February 2019, the CEO of Arm Holdings told CNBC that it would be “a while” before self-driving cars became mainstream.
“It is a phenomenally hard problem to anticipate what a car could do under absolutely any set of circumstances,” Simon Segars, who was speaking to CNBC's Karen Tso at the Mobile World Congress in Barcelona, Spain, added.

“I think you're going to start to see early services, in quite a constrained way, quite soon over the next couple of years,” he added, explaining that there was “some way to come” before the technology was “completely mainstream.”

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