The Station: Elon Musk's Loop, Redwood Funding, Kodiak Robotics

The Station: A Weekly Transportation Newsletter

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Recent Developments: The Las Vegas Loop

Recent investigative work by Mark Harris has uncovered compelling documents concerning Elon Musk’s Loop system in Las Vegas. These documents were obtained through a Freedom of Information Act request.

Controlling the Narrative

Among the findings is a detailed “ride script” for Loop drivers. This script provides instructions on how to handle passenger inquiries.

Specifically, drivers are directed to avoid answering questions regarding their tenure with the company. They are also instructed to feign ignorance concerning any incidents or accidents, and to steer clear of discussions about Elon Musk.

This indicates a strong emphasis by The Boring Company, the system’s builder and operator, on managing public perception of the Loop, its underlying technology, and its figurehead.

Autopilot Restrictions

The released documents also definitively confirm that Tesla’s Autopilot system, an advanced driver-assistance feature, is required to be disabled while operating within the Loop system.

Stay Connected

Your feedback is valuable. Feel free to reach out with your thoughts, critiques, or any relevant information.

You can contact me via email at kirsten.korosec@techcrunch.com. Alternatively, connect with me directly on Twitter – @kirstenkorosec.

Micromobbin’

This represents a departure from conventional notions of micromobility – a deliberate play on words, as you’ll soon understand – but this week’s focus is on a novel in-shoe navigation system designed to aid visually impaired individuals in independent urban travel.

Ashirase, functioning as both the system’s designation and the company’s name, utilizes a three-dimensional vibration device, coupled with a motion sensor, integrated within a pair of shoes. This hardware component connects to a smartphone application, enabling users with low vision to input their desired destination. Vibrations localized to the front of the shoe signal the need to proceed straight, while vibrations on either side indicate left or right turns. The intention is to allow for hands-free navigation, facilitating cane usage and enhancing attentiveness to environmental audio cues, ultimately fostering more intuitive and self-sufficient commutes.

The technology is notably innovative due to its reliance on a similar technological framework observed in autonomous driving and advanced driver-assistance systems. This alignment is logical, given the founder’s professional background. Wataru Chino contributed to Honda’s departments focused on EV motor control and automated driving technologies starting in 2009. His venture is a direct outcome of Honda’s Ignition incubator program, which supports original technologies, concepts, and designs originating from Honda employees, with the aim of addressing societal challenges and expanding beyond Honda’s core business areas.

Enhancing Accessibility: A Welcome Development

Cabify has recently unveiled a new feature designed to improve the accessibility of its rideshare service for seniors, individuals with partial visual impairments, and those with cognitive disabilities. This feature incorporates voice notifications to keep users informed about key events, such as driver arrival, ride commencement, reaching a stop, and receiving messages within the app’s chat function.

The system leverages the text-to-speech capabilities inherent in both Android and iOS operating systems.

According to a Cabify representative, “While Apple and Google operating systems provide the ability to vocalize text using the system’s voice, we have specifically developed the text content and defined the scenarios in which notifications are delivered to ensure user awareness and attention.”

Lime’s Expansion Strategy

Returning to updates on Lime’s ambitious plans for global expansion, one electric scooter at a time. The micromobility leader has announced a new integration with the Moovit transit planning application. Beginning this week, Moovit users in 117 cities across 20 countries will be able to view Lime’s electric scooters, bikes, and mopeds as potential travel options, either for the entire journey or as part of a combined, multimodal route. This development aligns with a broader trend of cities increasingly recognizing micromobility companies as contributors to public transportation solutions, particularly for addressing first- and last-mile connectivity. Integrating with Moovit, an application dedicated to public transit, supports the creation of a more comprehensive transportation network.

New Vehicle Introductions

Espin has launched a limited-edition fixie-style e-bike, named the Aero. This model is particularly well-suited for urban cyclists in cities like Seattle, especially those with a penchant for traditional bike-themed tattoos. The bike frame boasts a streamlined aesthetic characteristic of single-gear bicycles, featuring clean lines and available in either forest green or smoke gray. The Aero achieves maximum speeds of 20 mph and offers a range of 30 miles on a single charge. Notably, it is offered at a competitive price point of $1,399.

Splach, traditionally focused on e-scooters and e-bikes, has introduced a novel vehicle dubbed the Transformer. Its categorization is somewhat ambiguous, but it appears to offer a highly enjoyable riding experience. The company describes the light-duty e-vehicle as a “mini-moto Robust scooter specialized for rugged terrains.” It resembles a scaled-down dirt bike with an extended neck, allowing riders to stand while maintaining steering control. Based on video demonstrations, it appears well-equipped to handle challenging off-road conditions. Splach utilized Indiegogo for funding, successfully reaching its target within one hour.

— Rebecca Bellan

This Week's Notable Investments

Growing concerns surrounding battery supply chains are becoming increasingly prominent, with numerous automotive manufacturers committing to a complete transition from internal combustion engines to electric powertrains.

The production of battery cells necessitates access to essential raw materials, such as nickel. While traditional mining practices are the most prevalent method for obtaining these materials, their long-term sustainability is questionable. JB Straubel, formerly the co-founder and CTO of Tesla, is addressing this challenge through his venture, Redwood Materials.

This battery recycling firm is focused on establishing a circular supply chain. Straubel emphasizes that such a closed-loop system will be crucial for battery cell manufacturers to meet the demands of both consumer electronics and the anticipated surge in electric vehicle production.

Redwood Materials has recently secured $700 million in new investment from prominent backers including Amazon, funds managed by T. Rowe, and Bill Gates’ Breakthrough Ventures. This substantial injection of capital significantly surpasses the company’s previous funding round of $40 million, resulting in a valuation of $3.7 billion.

A recent interview with Straubel revealed his determination to rapidly expand operations, reflecting a sense of urgency in resolving this critical supply chain issue.

Further Investment Highlights

Clarios, a leading manufacturer of low-voltage vehicle batteries, has delayed its initial public offering (IPO) due to current market instability, as reported by Bloomberg. The Milwaukee-based company, supported by Brookfield Asset Management, initially aimed to raise $1.7 billion through the offering of 88.1 million shares, priced between $17 and $21.

Fisker, the electric vehicle company now publicly traded, has made an investment in EV charging provider Allego. Fisker will contribute $10 million through a private investment in public equity (PIPE) funding, supporting Allego’s merger with Spartan Acquisition Corp III. This merger values Allego at a pro forma equity value of $3.14 billion.

Flock, initially focused on drone insurance and now expanding into commercial vehicle insurance, has secured $17 million in Series A funding. The round was led by Social Capital, managed by Chamath Palihapitiya, with participation from existing investors Anthemis and Dig Ventures. This brings Flock’s total funding to $22 million.

HappyFresh, an on-demand grocery delivery service operating in Indonesia, has raised $65 million in a Series D round. The investment was led by Naver Financial Corporation and Gafina B.V., with contributions from STIC, LB, Mirae Asset Indonesia and Singapore, as well as returning investors Mirae-Asset Naver Asia Growth Fund and Z Venture Capital. The company previously raised $20 million in a Series C round in April 2019.

Lordstown Motors has received a financial boost from a hedge fund affiliated with Yorkville Advisors, approximately five weeks after issuing a warning regarding potential funding shortages for the production of its electric pickup truck. The hedge fund has committed to purchasing $400 million worth of shares over a three-year period.

Merqueo, an on-demand delivery service serving Latin America, has secured $50 million in a Series C funding round. The round was co-led by IDC Ventures, Digital Bridge, and IDB Invest, with participation from MGM Innova Group, Celtic House Venture Partners, Palm Drive Capital, and existing shareholders. This brings the Bogota, Colombia-based startup’s total funding to $85 million since its founding in 2017.

Niron Magnetics, a company pioneering rare-earth-free permanent magnets, has raised $21.3 million in new funding. Investors include the Volvo Cars Tech Fund and Volta Energy Technologies, alongside existing investors Anzu Partners and the University of Minnesota. The funding will be used to establish a pilot production facility in Minnesota.

Onto, an electric vehicle subscription service, has secured $175 million in a combined equity and debt Series B round. Swedish VC Alfvén & Didrikson led the equity portion, while British investment firm Pollen Street Capital provided a senior-secured asset-backed debt facility. The company’s total funding now stands at $245 million, with plans to double its fleet size every three to six months.

Zūm, a student transportation startup, has been awarded a five-year, $150 million contract to modernize transportation services for the San Francisco Unified School District. Zūm, already operating in Oakland, Southern California, Seattle, Chicago, and Dallas, will manage daily operations and transport 3,500 students across 150 campuses starting this fall.

Recent Developments at Argo AI

Information is constantly being gathered, and it's beneficial to share relevant updates.

A recent article published late Friday detailed Argo AI receiving a permit from California. This permit authorizes the company to provide complimentary rides to the public utilizing its self-driving vehicles on California’s roadways.

In short, the California Public Utilities Commission granted Argo the Drivered AV pilot permit. This is a component of the state’s Autonomous Vehicle Passenger Service pilot program. Consequently, Argo joins a limited, but expanding, number of companies moving beyond standard AV testing. This indicates preparation for eventual commercial deployment within the industry.

While regulatory challenges persist, and fully “driverless” paid rides are not imminent, notable advancements are occurring. Further permit acquisitions by the company are anticipated later this year.

Argo AI has not publicly specified the Californian city it intends to target for its robotaxi service. Testing of the company’s autonomous technology in Ford vehicles has been ongoing in Palo Alto since 2019. Currently, the California test fleet comprises approximately twelve self-driving vehicles.

The company also operates autonomous test vehicles in several other locations, including Miami, Austin, Washington, D.C., Pittsburgh, and Detroit. A collaboration with Ford and Lyft, announced in July, aims to deploy at least 1,000 self-driving vehicles on Lyft’s network over the next five years, beginning with Miami and Austin.

Sources with knowledge of Argo’s Californian strategy suggest focusing attention on areas outside the Bay Area.

Specifically, San Diego emerges as a potential location. Several AV companies are already conducting trials in the Irvine region, and Los Angeles presents logistical complexities. Furthermore, Ford maintains an existing presence in San Diego.

In 2017, the automaker collaborated with AT&T, Nokia, and Qualcomm Technologies to test Cellular vehicle-to-everything (CV2X) technology at the San Diego Regional Proving Ground. This initiative received support from the San Diego Association of Governments, Caltrans, the city of Chula Vista, and McCain, an intelligent transportation solutions provider. The goal of these trials was to enhance traffic flow, improve vehicle safety, and facilitate the development of autonomous vehicles.

Policy Updates

This week, we'll examine two significant proposed legislative measures: the infrastructure bill and revised tailpipe emissions standards.

Following extensive negotiations, senators in the U.S. have agreed upon a $550 billion infrastructure plan. This package allocates funding to crucial areas such as roads, bridges, and broadband expansion.

Specifically, the bill designates $7.5 billion for the electrification of buses and ferries, including school transportation options. An additional $7.5 billion is earmarked for the development of a nationwide network of public EV charging stations.

The White House has explicitly stated that these investments in electric vehicles are intended to enhance U.S. competitiveness globally. Currently, the U.S. holds only one-third of the market share for plug-in electric vehicle sales compared to China.

This funding represents a smaller portion of the initial $2.25 trillion proposal President Joe Biden presented in March. The original bill included significantly larger allocations for transportation electrification, particularly through rebates and incentives designed to boost consumer adoption of EVs.

The current bill awaits final Senate approval before proceeding to the House of Representatives and ultimately reaching President Biden for his signature.

Revised Emissions Standards

The Environmental Protection Agency and the Department of Transportation have jointly proposed new regulations to strengthen tailpipe emissions standards. These standards were previously relaxed during the administration of President Donald Trump.

The proposed rules mirror the 2019 agreement reached between the state of California and several major automakers, including Ford, VW, Honda, BMW, and Volvo, as reported by the Associated Press. If enacted, these regulations would take effect with vehicles manufactured starting in the 2023 model year.

The primary goal of these standards is to reduce carbon emissions from the transportation sector and incentivize the purchase of hybrid and electric vehicles.

However, several environmental organizations, such as the Sierra Club, and some EV manufacturers believe the proposed standards do not go far enough in addressing the issue.

“While this draft represents a step forward after a period of regression, simply returning to the previous trajectory is insufficient,” stated Chris Nevers, senior director of environmental policy at Rivian, in an interview with TechCrunch.

Nevers emphasized the need for the EPA and NHTSA to maximize the stringency of the program, taking into account both current and future advancements in vehicle electrification technology.

Automaker Pledge

Furthermore, reports from The Washington Post indicate that President Biden is currently engaged in discussions with a group of automakers. The aim is to secure a “formal pledge” from these companies to ensure that at least 40% of their vehicle sales are electric by the year 2030.

The specific automakers involved in these negotiations remain undisclosed. It is anticipated, however, that any such commitment would require substantial federal funding to support its implementation.

The provisions included within the infrastructure bill will likely be crucial in determining whether this pledge becomes a reality.

— Aria Alamalhodaei

Recent Developments in Transportation Technology

A significant amount of news emerged this week concerning the transportation sector. Let's examine the key updates.

Advanced Driver-Assistance Systems (ADAS)

The topic of ADAS now warrants its own dedicated section, emphasizing that these systems are distinct from fully self-driving vehicles. This distinction is crucial and should be consistently reinforced.

New York Times’ Greg Bensinger offers analysis on beta testing procedures and Tesla’s approach in a recent opinion piece.

Autonomous Vehicle Technology

Aurora’s co-founder and chief product officer, Sterling Anderson, recently published a blog post and accompanying tweets detailing a roadmap for an autonomous ride-hailing service. This service is projected to launch in late 2024, in collaboration with Toyota and Uber. While Aurora has prioritized self-driving trucks as its initial commercial offering, the robotaxi concept remains a key part of their long-term vision.

This announcement followed a partnership between competitor Argo AI and Ford with Lyft by approximately one week. The timing may be coincidental, but it highlights the intensifying competition in both the robotaxi and self-driving truck domains, with each company striving to demonstrate progress and establish strong partnerships.

TuSimple, a publicly traded self-driving truck company, has formed a partnership with Ryder to develop a freight network supporting its autonomous trucking operations. Ryder’s maintenance facilities will serve as terminals within TuSimple’s autonomous freight network, known as the AFN.

Electric Vehicle Industry Updates

Ford announced its second-quarter 2021 earnings on Wednesday, revealing a surprising profit despite ongoing semiconductor shortages. Notably, the F-150 Lightning electric pickup has garnered 120,000 preorders since its May unveiling. Ford’s revenue reached $26.8 billion, slightly below expectations, with a net income of $561 million for the quarter.

Lucid Group, formerly Lucid Motors, intends to expand its Arizona factory in Casa Grande by 2.7 million square feet. This expansion was announced shortly after the company’s initial public offering, which raised $4.5 billion in capital. Lucid also reported receiving 11,000 paid reservations for its Lucid Air luxury electric sedan.

Polestar plans to expand its market presence into nine additional countries this year, effectively doubling its global reach. The company, operating under Volvo Car Group as its electric performance vehicle brand, also aims to double its retail locations to 100 and increase its service centers by year-end. Currently, Polestar operates over 650 service points and intends to surpass 780 by the close of 2021.

REE Automotive has selected Austin, Texas, as the location for its U.S. headquarters. This strategic move will enable the company to address the growing demand for mission-specific electric vehicles from delivery, logistics, and mobility-as-a-service providers.

Tesla’s second-quarter earnings report showcased significant achievements, including a net income of $1.14 billion. This marks the first time the company has achieved a quarterly profit exceeding $1 billion on a GAAP basis, and it was accomplished without relying heavily on the sale of zero-emission credits.

Tesla CEO Elon Musk discussed the company’s battery strategy and announced a delay in the launch of the electric Semi truck program to 2022, citing supply chain constraints and limited battery cell availability. Delays are also anticipated for the Cybertruck’s release until next year.

Furthermore, Tesla’s latest earnings report indicated growth in its energy storage and solar business. Revenue from this segment—encompassing solar, Powerwall, and Megapack—totaled $801 million. Importantly, the cost of revenue for these products ($781 million) was lower than the revenue generated, a positive development.

Electric Vertical Takeoff and Landing (eVTOL) Vehicles

Joby Aviation recently completed its longest eVTOL test flight to date, with its full-sized prototype traveling over 150 miles on a single charge. The test took place at Joby’s Electric Flight Base in Big Sur, California, and is part of the company’s ongoing efforts to secure certification from the Federal Aviation Administration and initiate commercial operations.

Lilium, an electric air taxi startup, has partnered with German manufacturer Customcells to procure batteries for its seven-seater Lilium Jet.

Personnel Changes

AEye, a lidar company, has been strengthening its executive team in recent months. Recent hires include Bernd Reichert, a former Valeo executive, as senior vice president of ADAS, as well as Rick Tewell (formerly of Velodyne), Bob Brown (from Cepton), and Hod Finkelstein (from Sense Photonics) as chief research and design officer.

Cruise is also actively recruiting executives and engineers. New additions include Anthony Gregory (formerly of Southwest Airlines) as VP of market development, Phil Maher (formerly of Virgin Atlantic) as VP of central operations, and Bhavini Soneji as VP of product engineering. Soneji previously held leadership positions at Headspace, Microsoft, and Snapchat.

Cruise also welcomed Vinoj Kumar, who previously oversaw Google’s cloud infrastructure, as VP of Infrastructure, and Yuning Chai, formerly a lead perception researcher at Waymo, as head of AI Research. The company’s total workforce now exceeds 1,900 employees.

Don Burnette, co-founder and CEO of Kodiak Robotics, participated in a Q&A session with TechCrunch, discussing the company’s strategy, funding landscape, and lessons learned from his previous venture, Otto, which was acquired by Uber.

Trevor Milton, the founder and former CEO and executive chairman of Nikola, has been charged with three counts of fraud and is currently released on $100 million bail.

According to the federal indictment, Milton allegedly engaged in a fraudulent scheme to mislead retail investors for personal gain. He faces two counts of securities fraud and wire fraud.