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Elon Musk says the Tesla Model X is the ‘Faberge egg of cars’

Stephen Lam | Reuters
Tesla Motors CEO Elon Musk introduces the “falcon wing” door on the Model X electric sports-utility vehicle during a presentation in Fremont, California, on September 29, 2015.

Tesla CEO Elon Musk called the company's Model X luxury utility vehicle a “work of art” that he likened to the “Faberge egg of cars.”

“It's an incredible vehicle and probably nothing like it will ever be made again and maybe it shouldn't,” Musk told analysts after the company released its fourth-quarter earnings Wednesday. “But it is a work of art. It's a special work of art.”

The Tesla CEO said the planned Model Y crossover has been designed to share the same platform and most of the parts of the Model X.

The famed Faberge egg is a jeweled egg created by the House of Faberge in St. Petersburg, Russia from 1885 to 1917, first designed for Tsar Alexander III as a gift for his wife, the Empress Maria Feodorovna.

Auto website Jalopnik also seems to be smitten with the Model X, listing it naming among its favorite future classic cars in 2017.

“Look at the X. It's a giant space egg that dances and has flappy wings. No way this is not a collectible, whether or not Musk goes to Mars,” Jalopnik said.

Tesla shares drop sharply after Musk says CFO Ahuja is leaving the company — for the second time

Daniel Acker | Bloomberg | Getty Images
Deepak Ahuja, Tesla CFO (left) and Elon Musk, Tesla founder and CEO (right), at the Nasdaq opening bell ceremony for the Tesla initial public offering on Tuesday, June 29, 2010.

Tesla's long-time chief financial officer, Deepak Ahuja, is retiring from the company after almost 11 years, CEO Elon Musk said Wednesday.

It's the second time Ahuja has resigned from the company. He was one of Tesla's longest serving executives when he first left in 2015. Ahuja rejoined Tesla in 2017, replacing then-CFO Jason Wheeler, who abruptly resigned.

Shares of Tesla fell about 5 percent after the markets closed Wednesday night.

Tesla missed on earnings, but beat on revenue—three experts discuss what that means for the stock
58 Mins Ago | 01:58

Moving into the CFO role at the electric vehicle maker is Zach Kirkhorn, previously the company's vice president of finance. Ahuja said, “I feel really good about Zach taking over. He's proven his self over the years with many tough challenges he's worked on.”

Musk announced the change at the end of a conference call with analysts discussing the company's fourth-quarter earnings results.

Kirkhorn said, “I've been deep in the operations of every major program of the company from Roadster to…scaling our energy business and more things to come. I feel we're starting 2019 with a very strong financial foundation. We have enough cash to start new programs and develop new technologies.” Prior to his joining Tesla in 2010, Kirkhorn was formerly a business analyst at McKinsey & Co.

Musk said Ahuja will “continue to be at Tesla for a few more months, and will continue to serve as a senior adviser to Tesla for years to come.”

Ahuja first joined Tesla as CFO at the worst possible time: July 2008. He was with the company when it went public in 2010.

Tesla's finance team has seen high turnover in the past year with one chief accounting officer, Dave Morton, spending less than a month at the company.

Other long-time veterans have been resigning from Tesla in the past six months, for example, Charles Mwangi, a senior director of engineering who had been with Tesla since 2012, and one of Tesla's first-ever sales hires, Jeremy Snyder, who left his role as head of global business development there in August, according to his LinkedIn profile.

What Elon Musk just said about Tesla's quarter
1 Hour Ago | 03:53

Amazon is hauling cargo in self-driving trucks developed by Embark

Amazon is using self-driving trucks developed by Embark to haul some cargo on the I-10 interstate highway, CNBC has learned.

The trucks were previously noticed by a Reddit user, who photographed and shared images this week showing tractors emblazoned with the Embark logo and trailers painted with the Amazon Prime logo.

Saw this on the I-10 today. Is amazon making driverless trucks? from r/SelfDrivingCars

Embark integrates its self-driving systems into Peterbilt semis, rather than building its own vehicles completely from scratch. Generally, Embark trucks operate on roads with test drivers on board.

Embark and other firms working on autonomous systems – including fellow start-ups like Ike, Thor Trucks and Pronto.ai, and major players like Alphabet's Waymo and Tesla – aim to alleviate industry pains by making existing truck drivers safer and more efficient.

A driver shortage currently plagues the trucking industry, owing in part to the low pay and difficult schedules and conditions of the job. A lack of available drivers and trucks poses a challenge to e-commerce companies, obviously including Amazon, whose customers expect deliveries in a relatively short time.

CNBC asked both companies for further details about how they work together, but both declined to comment specifically on the deal.

Embark CEO Alex Rodrigues said, “Embark moves freight for a number of major companies on the I-10, however we cannot discuss any company specifically as our relationships are confidential.”

An Amazon spokesperson said, “We are always innovating and working with innovative companies to improve the customer experience and safety of our team. We think successful over-the-road autonomy will create safer roadways and a better work environment for drivers on long-haul runs. ”

Expect to see more autonomous trucks in circulation in the U.S. soon.

In October 2018, the National Highway Transportation Safety Administration issued its updated AV3.0 policy, which has helped autonomous vehicle firms like Embark figure out how to test their technology before driving on public roads, and which rules they need to comply with to stay there.

Founded in 2016, Embark has raised at least $47 million in venture funding from firms including Sequoia Capital, Data Collective, Y Combinator and AME Cloud Ventures.

WATCH:
Self-driving truck drives Los Angeles to Jacksonville

Embark Trucks self-driving truck drives Los Angeles to Jacksonville
8:40 PM ET Tue, 6 Feb 2018 | 01:08

Carlos Ghosn claims ‘plot and treason’ led to arrest

Kyodo | Reuters
A court sketch, drawn by Nobutoshi Katsuyama, shows ousted Nissan Motor Chairman Carlos Ghosn during a January open hearing to hear the reason for his continued detention, at Tokyo District Court in Tokyo, Japan.

Speaking from his Tokyo prison, the former Chairman of Renault-Nissan Carlos Ghosn told Japanese media that “plot and treason” by Nissan management led to his arrest.

In his first interview since being jailed, Ghosn told the Nikkei Asian Review on Wednesday that his plan to further integrate the automakers Nissan, Renault and Mitsubishi had triggered his downfall.

Ghosn said closer integration had been discussed with Nissan President Hiroto Saikawa in September but Saikawa had excluded Mitsubishi's CEO from the talks.

The tycoon reportedly said he had “no doubt” the legal charges against him were a result of “plot and treason” by Nissan management who opposed the strategy.

According to Ghosn, people who wanted to remove him from his role had also created a false image that his reign was a dictatorship.

“People translated strong leadership to dictator, to distort reality,” Ghosn said.

Nissan confirms SEC inquiry into company payment practices
7:29 AM ET Mon, 28 Jan 2019 | 00:38

Ghosn, along with former Nissan Director Greg Kelly, have now spent more than 70 days in jail.

Japanese prosecutors claimed the pair failed to declare around $43 million in deferred compensation between the years of 2010 and 2015. Ghosn is also accused of transferring personal trading losses to the company books.

Nissan has also separately accused Ghosn of receiving improper payments as well as using a third-party to purchase luxury properties in Rio de Janeiro and Beirut. The Brazilian-born businessman denies all the charges.

When asked about his health, the 64-year-old said he was “doing fine” and that life in the detention center was “up and down.”

On suggestions that he is being kept in prison as he is considered a flight risk, Ghosn responded: “I won't flee, I will defend (myself).”

French auto firm Renault holds a 43 percent stake in Nissan, while Nissan holds 15 percent of Renaults stock and a 34 percent stake in Mitsubushi Motors.

For more on this story please click here.

Tesla offers lower-priced versions of its Model S and X vehicles after cutting production

Robyn Beck | Pool | Reuters
Tesla founder Elon Musk speaks at the unveiling event by “The Boring Company” for the test tunnel of a proposed underground transportation network across Los Angeles County, in Hawthorne, California, December 18, 2018.

On Tuesday, Tesla began selling lower-priced versions of its Model S and Model X electric vehicles equipped with 100 kwh battery packs, meaning that all versions of those cars will come with the same battery.

The company faces mounting debts, amidst other challenges, as it aims to take its Model 3 sedans mainstream, and to manage a greater number of deliveries and service appointments than ever before.

Now that Model S and Model X vehicles all have 100 kWh battery packs — with their range and other features differentiated through “over-the-air” software updates — it may be easier for Tesla to make and deliver these cars to customers.

Tesla needs to clarify its cash flow through year, says analyst
7 Hours Ago | 02:29

These moves were not a complete surprise: On January 10th, CEO Elon Musk announced that Tesla would stop making versions of the Model S and X electric cars that had a lower price and a 75 kWh battery pack.

The lowest priced Model S will now cost $85,000 with software limiting the range of the battery to 310 miles per full charge, while the Model X will start at $88,000 with a range of 270 miles.

The higher-priced “extended range,” “performance” and “performance with ludicrous mode” versions of the cars will range from $93,000 to $137,000 and boast longer-range batteries and better performance.

Electrek first reported on the new pricing.

On January 18, Tesla laid off about 7 percent of its work force, its second restructuring in seven months. After the layoffs, the company acknowledged it cut back production of its Model S and X vehicles at its Fremont, California car plant.

WATCH: Bullish bets on Tesla

Bullish bets on Tesla
4 Hours Ago | 01:23

Harley-Davidson shares tank after big earnings miss

Harley-Davidson CEO: Our core rider continues to age, leave the sport
1 Hour Ago | 02:49

Harley-Davidson shares tanked by more than 9 percent Tuesday after the company reported fourth quarter earnings that missed analysts' expectations.

The motorcycle maker is battling declining sales as its core riders age, particularly in the United States, its largest market. The company said that despite the challenges attracting younger customers, it finished the year with 52,000 more riders than it had one year ago.

Here's how the company did compared with what Wall Street expected:

— Adjusted earnings: 17 cents per share vs. 28 cents per share forecast by Refinitiv

— Revenue: $1.15 billion vs. $1.05 billion forecast by Refinitiv

The company reported $500,000 in net income during the fourth quarter, versus net income of $8.3 million on consolidated revenue of $1.23 billion in the same period in 2017.

Harley-Davidson has struggled in recent years with declining sales and fears buyers simply are not as interested in motorcycles as they have been in previous generations.

Investors worry that there's been a fundamental shift in the market. Baby Boomers, which make up much of Harley-Davidson's customer base, are more likely to buy motorcycles and participate in the lifestyle and culture of riding than millennials. If younger buyers are considering motorcycles at all, they tend to do so for practical reasons, seeing motorcycles as an easy form of transportation.

This means that younger buyers are more likely to consider buying used bikes or cheaper and lighter motorcycles. This shift, said UBS analyst Robin Farley, could have potentially profound implications for Harley-Davidson, which has made its name selling heavy and typically expensive bikes.

The company has launched an ambitious plan to attract 2 million new riders within a single decade. The company is setting up riding schools around the United States, has plans to launch 100 new motorcycles by 2027 and increase volume in its international business 50 percent.

“The challenges we experienced during the year reinforced the commitment we have for our More Roads to Harley-Davidson accelerated plan for growth,” said Matt Levatich, president and chief executive officer, Harley-Davidson. “Our plan addresses the challenges of today and the opportunities we see for growth ahead, and we are energized by the momentum we are building.”

Porsche’s all-electric Tesla rival to come with three years free charging

Source: Porsche
2019 Porsche Taycan

German carmaker Porsche announced that buyers of its new all-electric Taycan model will get three years of free charging at stations across the United States.

The deal is part of a tie-up with Electrify America which operates almost 500 highway charging stations spread across the U.S. Each Taycan owner will now receive three years of unlimited charges of up to 30-minutes at each use.

Porsche has said its battery technology used in the Taycan car will be able to absorb charging rates of up to 350 kilowatts, almost three times greater than the current crop of Tesla batteries.

It said in a statement Monday that Porsche drivers using Electrify America's fast charging points, will become the fastest at recharging across today's car market, and a quick charge of 4 minutes would allow drivers to add 60 miles of range.

Source: Porsche
2019 Porsche Taycan

President and CEO of Porsche Cars North America Klaus Zellmer said that Electrify America's agreement with Porsche will provide a national infrastructure of fast charging that “frees Taycan owners from range anxiety.”

The news release also unveiled Porsche-designed home chargers, noting that 95 percent of charging occurs at home or work. All 191 U.S. dealers of Porsche cars will also install fast-charging points.

Porsche confirmed to CNBC last week it plans to double its production plan on the electric car it hasn't even released yet.

Source: Porsche
2019 Porsche Taycan

The German carmaker known for its sports cars and racing heritage said stronger-than-expected demand has led it to boost production on the Taycan from 20,000 to 40,000 units.

There is no official sticker price for the Porsche Taycan but it was reported in December that the car will come in three variants, ranging from $90,000 to $140,000.

That places Porsche's new offering squarely in the same pricing category of Tesla's more expensive models.

The Taycan will reportedly be unveiled at the 2019 Frankfurt Motor Show in September with showrooms receiving the vehicle by early 2020.

WATCH: Big automakers roll out electric car plans

Tesla competition heats up as big autos roll out electric car plans
5:38 PM ET Mon, 14 Jan 2019 | 06:01

General Motors is investing $22 million in a Tennessee plant to build fuel efficient V-8 engines

Rebecca Cook | Reuters
Members of the media look at General Motors 2020 Cadillac XT6 SUV after it was revealed on the eve of press days of the North American International Auto show in Detroit, Michigan, January 13, 2019.

General Motors said Thursday it will invest $22 million in its Spring Hill manufacturing complex in Tennessee to build high-tech, fuel-saving V-8 engines.

The announcement follows a $300 million investment at Spring Hill to make the Cadillac XT6, a three-row sport utility vehicle unveiled at the Detroit auto show in mid-January. The automaker said it has sunk $2 billion into the plant since 2010.

It also comes months after the largest U.S. automaker said it will cut up to 14,000 jobs in North America as it realigns its product portfolio away from slow-selling sedans. No new jobs at Spring Hill will be added as a result of the engine investment, said GM spokesman Dan Flores, but the XT6 project will add more than 200 jobs there.

The engines make their way into a variety of full-size vehicles GM makes, notably the GMC Sierra 1500 pickup and the Chevrolet Silverado 1500 pickup truck. They are equipped with a technology that turns different cylinders on and off in the engine depending on the driver's needs. The engine can run all eight cylinders when power is needed for acceleration or towing, but can reduce the number of cylinders operating when not needed to save on fuel. The engines can be operated the eight cylinders in an array of 17 different patterns, depending on what is needed.

Spring Hill currently builds both four- and eight-cylinder engines and assembles an array of vehicles. In addition to the XT6, GM also makes GMC Acadia SUV, the Cadillac XT5 mid-size SUV and the Holden Acadia, an SUV made for export. The plant employs about 3,800 total workers.

“We in the UAW will continue to encourage and support GM investing in their U.S.A. plants like Spring Hill, Tennessee and around the country,” said Terry Dittes, United Auto Workers union Vice President and Director of the GM Department, in a statement. “Building product where you sell is good for our members, their families, the communities and all of America”.

WATCH: How automakers sell a $71,000 version of a $27,000 car

How automakers sell a $71,000 version of a $27,000 car
10:40 AM ET Thu, 28 June 2018 | 02:46

Tesla downgrade by RBC means more analysts on Wall Street have ‘sell’ ratings than ‘buy’ on stock

Tesla was downgraded to underperform by RBC Capital, which said that the electric car maker has finally started to give some straight talk to investors about its future growth, but many are still not listening because they are still too enthralled by the company's founder and CEO Elon Musk.

Analyst Joseph Spak writes:

“It's not that we don't believe Tesla can grow over time, our model shows solid LT growth. But the current valuation already considers overly lofty expectations. For instance, let's assume 1mm [Model 3] units @$55k ASP, 12 percent EBIT margins, no interest/equity raise all by 2025. This is undoubtedly solid earnings, but at a more 'mature' 15x P/E, the discounted back value is ~$195, meaning even in an optimistic case at least 1/3rd of today's price is an 'Elon premium'.”

Tesla shares fell 1.5 percent in premarket trading Wednesday following the call. Through Tuesday, the stock was down 10 percent on the year to $298.92.

“The company seems to be more tactful with messaging which is a long-term positive, but means downward pressure to growth expectations – which in our view are too high to justify current levels, let alone to add to positions,” wrote Spak.

In the latest round of cost-cutting measures, Tesla said last week that it would cut 7 percent of its workforce and discontinue production of some other models to focus on the Model 3. Musk also said that the company likely achieved a “tiny profit” in the fourth quarter.

“For years, Tesla sold the dream of transportation disruption and fantastic growth. This served the stock well turning Tesla into a top 6 (at times top 3) valuable auto OEM despite delivering a fraction of units of others and nary a profit,” wrote Spak. “A stock should of course discount future cash flows and the market took the promises of Tesla and their future growth potential to justify lofty valuations while Tesla took capital needed to support their endeavors. But the rubber appears to be hitting the road as the realities of Tesla becoming a volume player, the challenges to scale and deliver high volume at high ASPs/margins are coming to a head.”

More buys than sells

RBC lowed its price target to $245 from $290. With Spak's rating change to underperform (the equivalent of a sell), there are now more analysts on Wall Street that say sell Tesla, than buy it. Eight analysts say “buy,” seven say “hold” and nine now say “sell,” according to TipRanks.com. It's rare for a stock as popular as Tesla to have a majority of analysts that say sell. The negative rating is still relatively rare, with most analysts typically using a “hold” rating to voice their displeasure with a stock. For comparison, Apple has zero sell ratings, according to TipRanks.

“Whether its cutting the price of their lineup by $2k/unit, admission the federal tax credit expiring will hurt, acknowledgment that Tesla can't sell at $35k Model 3 profitably and costs need to come down, or language around full-self driving – we'd classify recent commentary and actions by the company as more realistic,” stated the RBC note. “This is likely to cause a review of model assumptions leading to negative expectation revisions.”

— With reporting by Michael Bloom

Apple’s dismissal of 200 self-driving car employees points to a shift in its AI strategy

Bloomberg | Getty Images
John Giannandrea, senior vice president of artificial intelligence and machine learning strategy at Apple, speaks at the TechCrunch Disrupt 2017.

It's not often you hear about layoffs at Apple.

So it came as a surprise Wednesday when CNBC learned that Apple was removing 200 employees from its self-driving car unit. Apple confirmed the staffing change, but reading between the lines of a spokesperson's statement, it sounds like the move is the latest in the company's broader goal to improve its artificial intelligence and machine learning capabilities as it faces increased competition from rivals Google and Amazon.

“As the team focuses their work on several key areas for 2019, some groups are being moved to projects in other parts of the company, where they will support machine learning and other initiatives, across all of Apple,” the company spokesperson said in a statement to CNBC Wednesday.

Self-driving car technology may still be an important initiative at Apple. But reading between the lines, it looks like it's taking a back seat a Apple beefs up its general AI staff.

“I think they're making the decision that, at least in the near term, it's better to have these people doing AI in other projects,” said Gene Munster, a venture capitalist and analyst at Loup Ventures.

Apple's self-driving car project, called Titan internally, started out with the desire to create an Apple-branded electric car, The Wall Street Journal reported in 2015. But over the last few years, Apple has scaled back its ambition and lost leaders and other employees in the process. Today, the unit mostly explores the underlying technology that makes self-driving cars possible. CEO Tim Cook has repeatedly called self-driving “the mother of all AI projects.”

Since Apple started its self-driving division, the consumer AI space has exploded through the rise of digital assistants like Amazon Alexa and Google Assistant and devices like Amazon's Echo. Apple's own digital Assistant, Siri, had a head start when it launched on the iPhone 4S back in 2011, but has not kept up with the competition.

To address the shortfall, Applehired Google's head of AI John Giannandrea away from the search giant in April. Within a few months, Apple had reorganized its entire AI and machine learning teams under Giannandrea, the company announced to TechCrunch. And just last month, Giannandrea was promoted to Apple's executive team as vice president of machine learning and artificial intelligence strategy.

Self-driving may still be an important piece to Apple's AI research. The company said in its statement Wednesday: “We continue to believe there is a huge opportunity with autonomous systems, that Apple has unique capabilities to contribute, and that this is the most ambitious machine learning project ever.”

But as far as products go, competition in self-driving and electric vehicles has grown dramatically in the last four years.

Waymo, Alphabet's self-driving car company, recently opened up its self-driving car service to the public in Phoenix, Ariz., and is widely considered to be the leaders in self driving. Legacy car companies like GM working on self-driving technology. And it's not just Tesla making electric cars. Porsche, Audi, Mercedes and other legacy car companies have all announced electric vehicles. It's hard to imagine how Apple would stand out.

“The sense that I had is they're not as far along as I had hoped,” Munster said of Apple's decision to remove the 200 employees out of its car division. “But they still have initiative there.”

Giannandrea's rapid rise at Apple is the biggest signal yet that Apple intends to invest a lot of time, money and talent in improving AI. Plus, according to leaked comments from Cook at a recent company all-hands meeting reported by Bloomberg, Apple plans to continue hiring in AI “at a strong pace” even as it slows down hiring in other divisions.

In short, we're seeing Apple eliminate jobs in self-driving and increase the number of people working more broadly on AI.

It may already be paying off. Late last year, a study from Munster's company, Loup Ventures, showed Siri vastly improved its ability to correctly answer a series of 800 questions. The Loup study said Siri answered 74.6 percent of the questions correctly, up 22 percentage points from just nine months earlier. By comparison, Google Assistant answered 87.9 percent of the questions correctly. Alexa got 72.5 percent of the questions right.

It's not just about getting questions right, though. The messier problem for Apple is training its AI while convincing users that it's keeping their data secure.

Google trains its AI systems in part using the massive amounts of public data available on YouTube and the Google search engine. (It's also started using a program that strives to protect users' data.)

But Apple has taken a hard stance against unfettered data collection, and promotes its concern over user privacy as a reason to buy its products. In a speech in Brussels last year, Cook called the privacy practices of companies like Google “surveillance,” for example. It also put up a giant ad about its privacy stance in in Las Vegas during CES earlier this month.

So Apple will have to continue to improve its AI while sticking to its goal of keeping people's personal information private.

“I think it's very clear Apple is a believer in AI and most of the products will be very subtle about how AI is used,” Munster said.

WATCH: Apple CEO Tim Cook writes op-ed calling for tech privacy regulation

Apple CEO Tim Cook writes op-ed calling for tech privacy regulation
6:11 PM ET Thu, 17 Jan 2019 | 01:30