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Renault, Nissan abandon race for growth to focus on costs #ศาสตร์เกษตรดินปุ๋ย

Published May 27, 2020 by SoClaimon

#ศาสตร์เกษตรดินปุ๋ย : ขอบคุณแหล่งข้อมูล : หนังสือพิมพ์ The Nation.

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Renault, Nissan abandon race for growth to focus on costs

May 27. 2020
Trees are reflected on the glass facade of the Renault SA flagship showroom on the Champs Elysee in Paris, France, on Wednesday, May 27, 2020. MUST CREDIT: Bloomberg photo by Adrienne Surprenant

Trees are reflected on the glass facade of the Renault SA flagship showroom on the Champs Elysee in Paris, France, on Wednesday, May 27, 2020. MUST CREDIT: Bloomberg photo by Adrienne Surprenant
By Syndication The Washington Post, Bloomberg · Tara Patel, Shiho Takezawa

Renault and Japanese partners Nissan and Mitsubishi unveiled a plan for deeper cooperation in developing and building vehicles as they seek to salvage their strained alliance and weather a collapse in car demand.

The measures will help deliver savings of as much as 40% in model investments for jointly developed vehicles, the companies said Wednesday. Nissan will take the lead on autonomous driving, Renault on the body of electric cars and some electric powertrains while Mitsubishi Motors will work on plug-in hybrids, they said.

Renault, Nissan and Mitsubishi Motors need each other more than ever after the global coronavirus pandemic forced automakers to shutter showrooms and factories. The industry is also facing a once-in-a-generation shift to electric vehicles and autonomous driving that will require significant investment. After coming under pressure last year, the partnership is seeking a fresh start, backed by new measures at the companies to improve profitability.

“The new model focuses on efficiency and competitiveness, rather than on volumes,” Jean-Dominique Senard, chairman of the alliance operating board and Renault, said at a news conference.

That marks a change from an emphasis on growth during the era of Carlos Ghosn, who built the alliance and led it for almost two decades before his arrest in late 2018. In the past, the partnership focused “too much on expansion,” said Osamu Masuko, chairman of Mitsubishi.

Any plans for a merger between Renault and Nissan are also off the table, according to Senard. “We are moving forward within the current framework,” he said. Ghosn had pressed to make the alliance irreversible.

Renault shares surged as much as 20%, the most on record, and were up 18% at 22.53 euros by 1:37 p.m. in Paris trading. Even after the gain, shares remain 47% lower than at the start of the year. Nissan advanced 5.5% and Mitsubishi Motors climbed 5.4% in Tokyo.

“Renault has provided relief that its Nissan and Mitsubishi alliance will deepen as global scale remains crucial amid the near-term challenge of a global auto-demand slump and the high costs associated with the transition to EVs,” said Michael Dean, Bloomberg Intelligence’s senior auto industry analyst, in a note.

Nissan will lead efforts in China, North America and Japan, while Renault will focus on Europe, Russia, South America and North Africa. Mitsubishi will continue its efforts in Southeast Asia, where it already has a strong footprint.

In designating the so-called leaders and followers for projects, the partners are tackling one of the most prickly issues they have faced during the past decades: infighting and power struggles between French and Japanese engineering teams. The goal is to have close to half of the car models in the alliance produced under the new operating model by 2025, they said.

One example Senard provided is Brazil, where the companies use four manufacturing platforms to produce six models. Under the plan, this will be distilled down to one platform for seven models.

In Europe, Renault will lead on commercial vehicles, smaller SUVs and compacts while Nissan will oversee bigger SUVs and take the global lead in this area in five years.

“All members of the alliance will have access to all the key technologies,” Senard said. He and other top managers of the three car companies outlined the plan during an online press conference. They mostly avoided giving details about any specific plant closures, plans that could be revealed in coming days by Renault and Nissan separately.

The alliance came under intense strain following Ghosn’s departure as the circumstances around his sudden arrest fueled mutual suspicion and management turmoil. Some analysts question whether the efforts to right the partnership are too little too late.

“After 21 years, what have they been up to?” said Koji Endo, an analyst at SBI Securities in Tokyo. “Saying that it will be better in 2022 through 2024 is not convincing.”

Renault is preparing to unveil on Friday a cost-cutting plan worth 2 billion euros ($2.2 billion) over three years that is expected to include site closures in France and staff reductions. The carmaker has been caught in a political maelstrom this week due to union opposition to shutting factories and talks with the government, its most powerful shareholder, on a 5 billion-euro state-backed loan.

The company is considering shutting an engine and transmission factory in Choisy-le-Roi, France, and mulling the future of four other production sites, Franck Daout, spokesman for the CFDT union, said by phone Tuesday following meetings with Senard and Finance Minister Bruno Le Maire. These include Flins, iron foundry Fonderie de Bretagne, a factory in Dieppe and its Maubeuge site.

Le Maire on Tuesday said Flins shouldn’t be closed and any plans for Maubeuge need to be closely examined, while acknowledging the company’s manufacturing capacity is twice production levels.

Clotilde Delbos, the interim chief executive officer, said it’s “too early” to give details on the future manufacturing footprint in Europe, dodging the question ahead of the announcement of Renault’s cost-cutting program.

Nissan is due to announce its own restructuring plan on Thursday that will cut costs by 300 billion yen ($2.8 billion) and phase out the Datsun brand, a person with knowledge of the matter has said.

Nissan has struggled since Ghosn’s arrest with an aging car lineup and management paralysis denting its outlook. The automaker warned last month it expects to post a loss for the latest fiscal year through March. The Yokohama-based company also plans to shut down one production line in addition to the recently closed operation in Indonesia and reach the reduced spending target this year by cutting marketing, research and other costs, the person said.

Although Nissan is forecasting a 12% decline in sales to 10.2 trillion yen for the just-ended fiscal year, the new mid-term plan calls for a return to revenue of 11.5 trillion yen within three years, with fixed costs kept at reduced levels, the person said.

How the coronavirus will change the way we buy cars #ศาสตร์เกษตรดินปุ๋ย

Published May 25, 2020 by SoClaimon

#ศาสตร์เกษตรดินปุ๋ย : ขอบคุณแหล่งข้อมูล : หนังสือพิมพ์ The Nation.

https://www.nationthailand.com/auto/30388415?utm_source=category&utm_medium=internal_referral

How the coronavirus will change the way we buy cars

May 24. 2020
A visitor takes a photograph of a NIO EP9 autonomous electric vehicle (EV) on display at the company's NIO House brand experience center in Beijing on Dec. 2, 2017. MUST CREDIT: Bloomberg photo by Gilles Sabrie.

A visitor takes a photograph of a NIO EP9 autonomous electric vehicle (EV) on display at the company’s NIO House brand experience center in Beijing on Dec. 2, 2017. MUST CREDIT: Bloomberg photo by Gilles Sabrie.
By Syndication Washington Post, Bloomberg · Hannah Elliott · BUSINESS, US-GLOBAL-MARKETS 

Car sales are inching forward.

Though new-vehicle sales are down 47% year-over-year, and rental, commercial, and government fleet purchases have fallen 70% over the same period, too, the auto industry has enjoyed small amount of good news. Average incentive spending reached $4,296 per vehicle in April, according to Cox Automotive, up 7% from March and up 26% year-over-year. Sales of classic cars are booming. Factories across Europe and the U.S. have begun to reopen.

So have dealerships, though they are reeling from the loss of 265,000 jobs, according to Cox Automotive. Take Porsche Beverly Hills, where Sascha Glaeser works as director of customer experience and VIP sales. “We opened again on Friday, and customers are coming into the dealership,” he said by phone. “For me, I’m trying to do everything from home. When I do go in, we have masks on. We try to keep as much distance as possible.”

The outbreak has significantly changed how we think about-and shop for-the cars in our lives. While some changes are temporary, others are most likely permanent.

To better learn how the car-buying experience will evolve through covid-19-and how best to navigate it-I spoke with experts from research firms, car dealerships, and even our own Bloomberg Automotive Intelligence team. They highlighted a host of issues that will factor in to the new world of car buying, including e-commerce, independent mechanics’ shops, and strict franchise laws. Below are their answers to the most pressing questions about the future of acquiring vehicles.

– Will social distancing kill the car dealership?

The shorter answer is no, it won’t. But it has sped up changes that were already in motion before the covid-19 pandemic hit.

“We know that consumers will continue to be concerned about social distancing,” says Stephanie Brinley, principal automotive analyst at research firm IHS Markit. “But what we really see is that there were trends toward making car buying an easier process already happening before we started going into [the pandemic].”

The old-fashioned handshake deal will be dead. But the prevalence of smaller showrooms, tactical, more localized marketing, pre-approved financing, and online sales and insurance transactions is likely to grow.

Jack Gillis, executive director of the Consumer Federation of America, says social distancing is quickly forcing car dealers to alter their entire sales strategy. Some dealers are changing compensation plans, for instance, so sales representatives get paid for how many cars they sell, not necessarily the value sold. This removes a lot of pressure on the sales floor-for everyone.

“One of the biggest challenges for a consumer when buying a car is matching wits with a seasoned professional in the showroom-this is a person trained to get as much money as they can for each car,” he says. “These are trained negotiators who do this, day in and day out. Consumers are like lambs being led in to slaughter when we go into a showroom.”

In many cases, Gillis says, the car-buying process becomes so frustrating and anxiety-laden that consumers give up.

“By the end of it, we’ll do anything to just get out of there and just get our car,” he says. “People sign on the bottom line for things they don’t really need-like rust proofing and special mats and paint sealant-just to get away.”

Coronavirus will change this by winnowing out the worst dealerships and demanding efficiency and better service in others. The good news for consumers, he says, is that we won’t be going back to this condition as normal-ever.

– Well, how good are dealerships at doing socially distanced transactions?

It depends on where you are. Some dealerships are better at it than others. They’ve got their work cut out for them: According to Cox Automotive, some 60% of consumers would rather not visit a car dealership at all.

“Are car dealerships future-proof? No, no they’re not,” says Glaeser.

Plastic wraps on steering wheels and seats, driveway drop-offs for test drives, and personalized new-car deliveries are all on the table for dealerships motivated to support safety-sensitive customers. The points of contact between consumers and salespeople should be minimized, with one person, rather than two or three or five, devoted to each customer. There will be much more one-one-one attention for customers who engage with sales people, especially at higher-end brands, predicts Glaeser. (The business case for that is simple: Get a consumer in a cozy, comfortable, safe, and intimate environment, and they’re more likely to spend money.) In Los Angeles, Glaeser is doing selective, masked one-on-one test drives with customers from their homes in the Pacific Palisades.

“The best dealers we see are taking social distancing very seriously,” says Jeremy Anspach, chief executive officer of Purecars, an automotive digital marketing firm. “When you think about all the cars in the showroom and the spacing, compared to a box retailer or a grocery store, the idea of social distancing is quite easy.”

That said, there will be culling. Some automakers have too many dealerships dotting the country; this has led to some splintering business profits that will be exacerbated during and after the pandemic, says Kevin Tynan, director of automotive research for Bloomberg Intelligence.

Exhibit A: Fiat Chrysler has 10,271 dealerships in the U.S. while Toyota has 1,400, according to Bloomberg Intelligence. Last year, the average Chrysler dealer sold 656 units, while the average Toyota dealer sold 1,700. Assuming an industry average of 5% margin profit for each sale, it’s easy to see which dealers fared better.

“Toyota doesn’t have the footprint, but they have a much healthier base because [each dealer] is getting theirs,” explains Tynan. “The domestic guys look at the numbers and would likely say we have too many of these damn things. They’re eating each other. Politically, of course, they won’t say, ‘We would just love to kill some dealerships.'”

The pandemic may do it for them.

– Is this the death of the test-drive?

Not yet. Historically, at most dealerships, the rule was that you had to take the car out with a sales representative. All the technology in modern cars made this essential; it’s better to learn how to use the Bluetooth from a person than an app. Special friends of the dealership and VIP clients could take the car for a spin alone, after handing over driver’s license and insurance information.

Expect to see more of that post-covid-19.

“Many of the problems that a consumer has with a car could be sussed out with one good, long test drive-preferably without the sales rep,” says Gillis. “You’ve got to kick the tires to make sure you like the car. That concept of touching it, feeling it, looking at it, sitting in it, driving it is very ingrained in the way we buy cars.”

The test drive should last at least an hour. Park it in your driveway, and pull out. Steer it into your garage. Take it on the highway. Drive it on your normal errands route. You’ll end up observing the things that could become problems later, such as blind spots, ambient road noise at high or low speeds, a too-small (or too large) trunk. You may just decide you don’t like the car’s color in your driveway.

– What about online sales? Will those increase?

Yes. Online car sales in 2019 made up 10% to 15% of the total U.S. vehicle market, according to research firm Autopia. But if you listen to the experts, buying a car online won’t be the first choice for most car shoppers, even after covid-19.

Dealers are likely to update and improve their websites. And they’ll probably respond to emailed inquiries faster. But the average transaction price of a new car is $35,000, and $21,000 for a used car. It’s still the largest payment you’re likely to make for something other than your home. For most people, it’s “inconceivable” to purchase something of that value without seeing it first, says Tynan.

“I think e-commerce will go up, but it was going up anyway,” he says, adding that this also has to do with getting the best deal possible, which is less likely via impersonal transaction online. (Online sales were less than 10% of total domestic car sales just three years ago.) “We may do some more online research first, but no dealer is going to give you their best deal through email. I just don’t see that happening.”

Consumers can use that to advantage. Do even more research online, and cross-shop from dealer to dealer before you head to the dealership for that (socially distanced) test drive.

“There will be tremendous competition over the next six months because the industry is suffering,” Gillis says. “Dealers have a huge incentive to offer the very best prices. And if you combine that incentive with your ability to shop online from dealer to dealer, you can end up getting a great car and a great value.”

That said, do companies already doing online sales, such as Carvana, have an edge in the new generation of car buying?

Yes and no.

When it debuted in 2013, Carvana leapfrogged the franchised dealer by allowing consumers to buy cars online, which forced franchised dealers to elevate service and allow customers to complete transactions in any number of ways. In 2018 Carvana sold 100,000 cars; last year it sold 177,549. (Revenue in 2019 reached $3.94 billion, an increase of 101%, year-over-year.) Company chief Ernie Garcia has said he thinks annual sales can reach 2 million vehicles.

The company’s current and best advantage is its centralized inventory and its relatively easy seven-day-return policy. Most local car dealerships can’t compete with that from a logistical point alone. But Carvana’s business model is difficult to scale to a truly national scale, and this will keep it from totally replacing traditional dealers, which are too locally focused to sell online across a national platform.

“It’s a niche thing,” Tynan says.

If you do decide buy a car online, the most essential thing you must do is fully understand the return policy.

– Will there be a different future for the purchase of a luxury car?

Yes. The new normal for car buying may very well fall along the line between wealthy and average.

“The Carvana-type of online buyer is that kind of person who buys on Amazon. It’s a digital transaction,” says Anspach. The franchise dealer is still the trusted choice of consumers who want an experience for a larger purchase. Such automakers as Lamborghini, Ferrari, Bentley, and Rolls-Royce have long catered to that impulse with exclusive ateliers and customization shops that are separate from dealerships.

“I envision that this type of luxurious, intimate environment could be a good model for the future,” says Glaeser. “For exclusive and high-end cars, it would be a boutique or salon that will handle customization, selection of colors and textiles and leathers, and all of that for the client. It will be very safe, very one-on-one.”

– Will consumers stop buying cars as often as they used to?

It’s likely. There may be some permanent tapering, even after the primary concerns of food, shelter, and health-which are foremost in mind during a pandemic-are allayed. The average age of the car on the road today in America is 11 years; expect that number to rise, says Gillis.

“There’s a tremendous lack of demand, not pent-up demand,” he says. “Consumers are thinking: ‘You know, maybe I really don’t need a new car right now. My car is fine, it’s running well. I’m rarely using it. I don’t feel this urgency to go out and buy a new car.'”

Not to mention that regulations require less driving, anyway. Travel on all roads and streets declined by 18.6% (50.6 billion fewer vehicle miles) for March 2020, compared with March 2019, according to the U.S. Department of Transportation. Personal travel around the country by car fell 46% year-on-year during the week ending April 17, according to Inrix surveys. We are driving far less, slashing the urgency to buy a new car.

“Consumers are going to realize they don’t need to replace their cars so frequently, and we are going to become used to keeping our cars longer,” he says. “Over time, that will reduce this sort of perpetual need to replace your car every three years. Buyer behavior is going to change, so the whole industry is going to change dramatically.”

– Is home delivery going to stick around?

It depends on your dealer. But for most dealers, the time sales reps would spend dropping off and picking up cars to individual consumers’ houses for test drives or deliveries is not cost-effective.

“Margins at most dealers are under 5%, so you’re on a razor-thin margin, anyway,” Tynan says. “For used cars, the margin is about 7.5%. And the closing rate of driving a car to someone’s house for a test drive isn’t much higher than not. So how are you going to incur these additional [delivery] costs?”

On the other hand, Anspach says some post-Covid-19 dealers will be more willing than ever to service customers, however they want to be serviced.

“Whether it’s pickup and drop off-for a lot of dealers it’ll be: ‘The car will be here and running. I’ll text you when we are on our way. You don’t have to even speak to me,'” he says.

– How will the auto industry recover from this?

In a word: trucks.

“A big part of the recovery, and we did see this in April, is that from the manufacturer to the retail channel to the dealer, the key is sellable products-and sellable products are trucks,” Tynan says. “If you’re going to dig out of this, you’re going to get your best shovel. And it’s just simply trucks.”

Indeed, according to Bloomberg Intelligence, 75% of autos sold in April in the U.S. were light trucks (which includes SUVs). Hyundai, for one, has taken advantage of the numbers: By April, Hyundai had increased its truck mix by 11 percentage points over 2019, up to 54% trucks from 43% trucks, and adding such models as the Venue crossover.

“When you think about the revenue and the profit side of the business, that’s where you have to live,” says Tynan. “You want to do more with less. Volume is going to be beat up for a while, so you have to have the higher revenue contribution and the higher profit contribution. That’s just the way it’s going to be, so at the retail level, that’s the mindset: Give me trucks.”

Elsewhere, automakers must simply move forward with projects already underway.

“When people are working from home, there’s only so much you can do to help something move forward-but they’re still moving forward,” says Brinley. “The anticipation is that it’s fundamentally temporary. It’s maybe just going to be longer than we expected.”

Volkswagen apologizes for racist ad showing black man being dragged away from new car #ศาสตร์เกษตรดินปุ๋ย

Published May 22, 2020 by SoClaimon

#ศาสตร์เกษตรดินปุ๋ย : ขอบคุณแหล่งข้อมูล : หนังสือพิมพ์ The Nation.

https://www.nationthailand.com/auto/30388284?utm_source=category&utm_medium=internal_referral

Volkswagen apologizes for racist ad showing black man being dragged away from new car

May 21. 2020
By The Washington Post · Jacob Bogage · BUSINESS, WORLD, RACE, EUROPE 
Volkswagen pulled and apologized Thursday for a racist advertisement posted on its Instagram page that a company official called “an insult to every decent person.”

The 10-second clip depicted a pair of oversize white hands dragging a black man away from a new VW Golf 8 sedan, and flicking him violently into a restaurant called “Petit Colon,” a name with overtones of colonization.

Briefly as a spokeswoman reads the phrase “Der Neue Golf,” or “the new Golf,” as it appears on the screen, the letters materialize in an order that briefly spells the German n-word.

The company, which also produces the brands Audi, Skoda, Seat and Porsche, removed the video, but it was reposted by critics on social media.

Volkswagen board member Juergen Stackmann and the company’s head of diversity management, Elke Heitmueller, said in a joint statement that they were “horrified” by the ad, and that the company was “aware” of its “historical origins.”

Volkswagen was founded by the Nazi government in the 1930s to build the “people’s car,” and used slave labor from concentration camps in its manufacturing processes.

“That is precisely why we resolutely oppose all forms of hatred, slander/propaganda and discrimination,” the statement said.

“I sincerely apologize as an individual in my capacity as a board member at Volkswagen Sales & Marketing,” Stackmann added in a tweet. “Hatred, racism and discrimination have no place at Volkswagen! In this case, I will personally ensure full transparency and consequences!”

The company, which is the world’s largest automaker, is still reeling from its 2016 emissions scandal. Volkswagen programmed “defeat devices” into two-liter diesel engines that were programmed to turn off emissions measurement data outside of laboratory settings. Those engines spewed 40 times the legal limit of harmful nitrogen oxides.

Settling the issue required a major consumer buyback program that put the company on the back foot and cut its stock price in half. Volkswagen still has not regained the lost share value.

News of the advertisement imbroglio did not affect its stock, which traded up modestly higher to close at $15.50.

But Volkswagen’s public image has not stayed out of the spotlight since. Audi in 2017 ran a commercial in China comparing women to used cars. Last year, Chief Executive Herbert Diess mimicked a Nazi slogan when discussing a metric of the company’s finances. The company apologized for both incidents.

Stackmann and Heitmueller said they “cannot explain” how this latest ad was released. They said the company would investigate and make public the “results and consequences.”

Fiat plans to issue $1 billion bond to repay credit line #ศาสตร์เกษตรดินปุ๋ย

Published May 17, 2020 by SoClaimon

#ศาสตร์เกษตรดินปุ๋ย : ขอบคุณแหล่งข้อมูล : หนังสือพิมพ์ The Nation.

https://www.nationthailand.com/auto/30387811?utm_source=category&utm_medium=internal_referral

Fiat plans to issue $1 billion bond to repay credit line

May 13. 2020
By Syndication Washington Post,  Bloomberg · Daniele Lepido, Tommaso Ebhardt · BUSINESS 

Fiat Chrysler Automobiles plans to repay part of a multi-billion euro credit facility via a new bond sale of up to 1 billion euros ($1.1 billion), in a move that will signal the debt market’s level of confidence in the Italian-American carmaker.

Fiat Chrysler will likely issue a bond worth between 750 million euros to 1 billion euros by the end of month, people familiar with the matter said, to repay the first tranche of a loan obtained in March. Ultimately, the company aims to repay the whole 3.5 billion euros via bond issuance. The sale will be its first in Europe for four years.

The company’s euro-denominated bonds due in March 2024 fell slightly to 101.1 cents on the euro, according to CBBT data at 11.20am in London.

The firm hasn’t yet decided whether to issue in U.S. dollars or euros. The unsecured debt won’t be backed by a collateral, the people said, asking not to named because the discussions are private.

A spokesman for Fiat Chrysler declined to comment.

Auto manufacturers and their parts suppliers have shuttered factories across the world in recent months amid government lockdowns in China, Europe and the U.S., halting sales and wreaking havoc on supply chains.

A successful bond sale would signal a welcome vote of confidence in the carmaker despite the uncertainty caused by the pandemic.

Fiat Chrysler agreed last year to combine with French rival PSA Group to create the world’s fourth-largest automaker by volume, allowing the companies to share the cost burden of expensive new technologies.

The tie-up may also bolster results by strengthening the partners’ foothold in Europe’s lucrative commercial vehicle business.

Last month Fiat Chrysler drew down its 6.25 billion euros revolving credit facility, originally signed in June 2015 and amended in March 2019. These funds add to 1.5 billion euros drawn down from other bilateral credit facilities.

A potential 1 billion-euro offering by the split-rated issuer would be one of the largest in Europe since the region’s high-yield primary market reopened after the Covid-19 crisis. The carmaker carries the highest junk grade by S&P Global and Moody’s, and was upgraded to investment grade by Fitch in 2018.

Tesla’s Musk reopens Calif. factory, defying county orders and daring officials to arrest him #ศาสตร์เกษตรดินปุ๋ย

Published May 17, 2020 by SoClaimon

#ศาสตร์เกษตรดินปุ๋ย : ขอบคุณแหล่งข้อมูล : หนังสือพิมพ์ The Nation.

https://www.nationthailand.com/auto/30387739?utm_source=category&utm_medium=internal_referral

Tesla’s Musk reopens Calif. factory, defying county orders and daring officials to arrest him

May 13. 2020
Tesla's Elon Musk

Tesla’s Elon Musk
By The Washington Post · Faiz Siddiqui · BUSINESS

FREMONT, Calif. – Tesla’s Elon Musk is in a showdown with California officials over the reopening of a major factory, one of the most prominent examples of a powerful business defying health orders that require all but essential activities to cease.

Musk continued to ramp up production at the company’s Fremont facilities Tuesday, where the company produces its electric vehicles. Workers’ cars filled up the company’s parking lot, with no signs of any enforcement actions by Alameda County officials, who sent a letter Monday telling the company to cease production.

Musk drew public support Tuesday from President Donald Trump. “California should let Tesla & @elonmusk open the plant, NOW,” Trump tweeted. “It can be done Fast & Safely!”

Musk tweeted back, “Thank you!”

That follows a private call with the president and other CEOs last month, on which Musk was agitating to reopen and praising Trump. He said he wanted to return to work by May 1 and, if possible, sooner.

“I do not think it represents a significant risk,” he said, according to two individuals familiar with the discussion, who declined to be named because of the private nature of the interaction. Trump said that he agreed with Musk 100%, the people added.

Meanwhile, Musk on Monday dared local health officials to arrest him. “Tesla is restarting production today against Alameda County rules,” Musk wrote on Twitter. “I will be on the line with everyone else. If anyone is arrested, I ask that it only be me.”

Colleen Chalwa, Health Care Services Agency director of Alameda County, sent a letter Monday ordering Tesla to cease production.

“If the reports we have received are true, Tesla is engaging in work beyond Minimum Basic Operations, and is in violation of the Health Officer Order,” she wrote. “These activities must cease until the Health Officer approves Tesla’s site-specific plan as required by the State of California guidance and checklist for manufacturing, and issues an order permitting manufacturing generally.”

It was the latest escalation following the company’s decision to start calling workers back to the factory last week. Tesla on Saturday filed suit against Alameda County, where its Fremont factory is located, seeking an injunction against orders to stay closed. The suit alleged violations of the due process and equal protection clauses of the 14th Amendment.

Neetu Balram, a spokeswoman for Alameda County, said in a statement that the county hoped to work with Tesla to avoid any further escalation of the issue.

Fremont Police would need to enforce the county’s order. Fremont Police spokeswoman Geneva Bosques said there was no update on Tuesday. The city’s mayor issued a statement in support of Tesla on Saturday.

In an interview, Alameda County Supervisor Scott Haggerty added that while dialogue continues with Musk, “I can’t stop him from breaking the health order.” He credited the county’s tough stance in part with the low prevalence of the illness in the county, roughly 2,000 cases and 71 deaths.

On the possibility of arrests, Haggerty said, “I would sincerely hope not.” He added, “I don’t think that’s a good view for anybody – especially somebody that’s employing 10,000 of your constituents. I think cooler heads need to prevail on this.”

Tesla did not respond to a request for comment. The company employs about 10,000 workers in Fremont.

Two workers at Tesla’s Fremont facilities, who spoke on the condition of anonymity because they feared for their jobs, said they were concerned about the sudden escalation of production. One worker who reported to the factory over the weekend said people gathered in groups and there was little enforcement of social distancing practices.

Returning workers are shown an informational video about the need to abide by strict social distancing and given masks. Meanwhile, the factory began once again to churn out Model 3 and Model Y vehicles.

“Everybody’s walking around without their mask on, talking, hanging out talking among themselves,” the worker said. “It’s scary.”

On Tuesday, workers reporting to the Fremont factory wearing thin surgical masks offered mixed reactions, declining to provide their names because they weren’t authorized to speak publicly. One said that work was starting up slowly due to restrictions. Another said Musk was walking around, providing encouragement, while some employees opted to stay home. A food truck pulled onto the property in the morning.

Musk’s aggressive push to reopen has gained the tacit support of conservatives aligned with the president and drawn the ire of liberals, including a California state assemblywoman who punctuated her displeasure with an expletive over the weekend.

Eric Trump, the president’s son, liked Musk’s tweet Monday.

As coronavirus shutdowns have dragged on, some states have moved more quickly to reopen, and protests have broken out to demand an end to the shutdown orders. In Silicon Valley, which has had some of the most restrictive orders in place for the longest time, a handful of tech elites have echoed and promoted Musk’s concerns.

California loosened restrictions earlier this month, allowing some commerce and manufacturing to resume, but stricter county orders supersede the state rules.

The company said in a blog post Saturday that it planned to reopen and laid out an argument for how it could safely do so. Earlier that day, Musk tweeted that he was considering relocating Tesla’s Palo Alto headquarters, located in another California county, to Texas or Nevada, and lambasted Alameda County’s response.

Musk repeatedly has played down the seriousness of the coronavirus, at one point calling the panic “dumb.” On the company’s earnings call late last month, he called the quarantine measures “fascist” and used profanities to describe what he saw as “forcibly imprisoning” people in their homes against their constitutional rights.

Musk’s erratic behavior continued this month when he tweeted that Tesla’s stock price was “too high,” sending shares plummeting during the middle of trading on May 1. Since then, he has consistently complained about the stay-at-home orders, saying Tesla has been unfairly singled out among large automakers and railing against California officials.

He took aim at the county’s interim public health officer, Erica Pan, who he derided over the weekend as “an unelected county official” and alleged she “illegally” overrode the state orders – despite county officials’ ability to supersede them.

Alameda County’s Haggerty said: “She’s not incompetent. That I don’t like. Elon Musk is a very smart man, very focused. I just wish that he wouldn’t disparage some of my staff.”

Musk also tried to keep the factory open at the beginning of the crisis in mid-March, as the Bay Area became the first major region to order residents to stay home. The county at the time told Tesla it did not count as an essential business.

Haggerty said the county’s dialogue with Tesla continues. Musk had pushed for Tesla to be able to staff a stamping plant to produce fenders and doors and other car body parts, ahead of a May 18 reopening date being negotiated by the county.

“That would ensure there was enough parts when everybody came back to work on the 18th,” he said, but the health department’s indicators did not yet say it was safe to do so.

Currently, conditions have affected morale at the plant, the employee who works there said.

“We’re extremely frustrated, angry, scared, that Elon is putting his cars before his workers,” the worker said. “He’s putting those cars before his employees and their well-being.”

Tesla’s Elon Musk defies county orders to reopen factory, daring officials to arrest him #ศาสตร์เกษตรดินปุ๋ย

Published May 17, 2020 by SoClaimon

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Tesla’s Elon Musk defies county orders to reopen factory, daring officials to arrest him

May 12. 2020
Elon Musk

Elon Musk
By The Washington Post · Faiz Siddiqui · BUSINESS 

SAN FRANCISCO – The fight between Tesla and local officials regarding the reopening of a manufacturing plant escalated Monday after chief executive Elon Musk tweeted his plans and mentioned the potential for arrests.

“Tesla is restarting production today against Alameda County rules,” Musk wrote on Twitter. “I will be on the line with everyone else. If anyone is arrested, I ask that it only be me.”

It is one of the most prominent examples of a powerful public figure defying local health orders amid the novel-coronavirus response. Tesla on Saturday filed suit against Alameda County, where its Fremont, California, factory is located, seeking an injunction against orders it stay closed. The suit alleged violations of the due process and equal protection clauses of the 14th Amendment.

Neetu Balram, a spokeswoman for Alameda County, said the county hoped to work with Tesla to avoid escalation of the issue.

“We are addressing this matter using the same phased approach we use for other businesses which have violated the Order in the past, and we hope that Tesla will likewise comply without further enforcement measures,” she said in a statement, adding that the county learned Monday that the company was conducting business beyond minimum basic operations.

She said Tesla was expected to submit a plan late Monday detailing its reopening plans. “We look forward to reviewing Tesla’s plan and coming to agreement on protocol and a timeline to reopen safely,” she added.

Tesla did not respond to a request for comment.

Musk’s aggressive push to reopen has gained the tacit support of conservatives aligned with the president, and drawn the ire of liberals, including a California state assemblywoman who punctuated her displeasure of the billionaire with an expletive over the weekend.

Eric Trump, the president’s son, liked Musk’s tweet Monday.

As the coronavirus shutdowns have dragged on, some states have moved more quickly to reopen, and protesters have demanded an end to the shutdown orders. In Silicon Valley, which has had some of the most restrictive orders in place for the longest time, a handful of tech elites have echoed and promoted Musk’s concerns.

California loosened restrictions this month, allowing some commerce and manufacturing to resume, but stricter county orders supersede the state rules.

The company said in a blog post Saturday that it planned to reopen, and laid out an argument for how it could safely do so. Earlier that day, Musk tweeted that he was considering relocating Tesla’s Palo Alto headquarters, located in another California county, to Texas or Nevada, and lambasted Alameda County’s response.

Musk has repeatedly played down the seriousness of the coronavirus, at one point calling the panic “dumb.” On the company’s earnings call late last month he called the quarantine measures “fascist” and used expletives to describe what he saw as “forcibly imprisoning” people in their homes against their constitutional rights.

Musk’s erratic behavior continued this month when he tweeted that Tesla’s stock price was “too high,” sending shares plummeting during trading on May 1. Since then he has consistently complained of the stay-home orders, saying Tesla has been unfairly singled out among large automakers and railing against California officials.

He took aim at the county’s interim public health officer, Erica Pan, whom he derided over the weekend as “an unelected county official”; he said she “illegally” overrode the state orders – despite county officials’ ability to supersede state orders.

Musk also tried to keep the factory open at the beginning of the crisis in mid-March, when the Bay Area became the first major region to order residents to stay home. The county at the time told Tesla that it did not count as essential business.

VW steps up efforts to lure German buyers back to showrooms #ศาสตร์เกษตรดินปุ๋ย

Published May 17, 2020 by SoClaimon

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VW steps up efforts to lure German buyers back to showrooms

May 11. 2020
By Syndication The Washington Post, Bloomberg · Christoph Rauwald

Volkswagen is starting a sales initiative to revive demand in its domestic German market as consumer uncertainty across Europe’s largest economy risks choking off factory restarts.

The world’s biggest carmaker will offer improved leasing and financing terms and payment-protection insurance in case buyers lose their jobs, VW’s passenger-car division said Monday in a statement. The program for new and used cars starts on Friday and runs through July 31.

“We want to provide a first strong stimulus so that customers come to dealerships again,” VW brand sales chief Juergen Stackmann said. “According to market research institute GfK, consumer sentiment has reached a historic low in April. We need instant measures that have a positive effect on the consumer climate.”

The German automaker and peers includung Daimler and Renault revved up vehicle output even as many customers avoid showrooms in Europe following the coronavirus outbreak. Dealerships reopened in some countries after lockdown measures gradually eased, but buyers are shying away from big-ticket purchases amid the economic fallout from the crisis and rising unemployment.

The German auto industry has called for a state-backed incentive program to reignite car purchases and provide much-needed stimulus for the broader economy to avert a prolonged recession. The demand has sparked controversy among the country’s political ranks as VW, Daimler and BMW have raked in billions of euros in profits in recent years and have stuck to dividend plans.

The European auto industry has been hit hard by the covid-19 outbreak with factories shuttered for 29 working days on average, according to Brussels-based lobby group ACEA. The plant closures have resulted in lost production of more than 2.3 million vehicles so far. VW, Daimler and BMW are bracing to suffer losses in the second quarter as sales were effectively wiped out in April.

VW’s European deliveries excluding Germany slumped about 83% last month, worse than a 67% fall its home market. Demand in the manufacturer’s largest sales region of China almost returned to pre-crisis levels with a 2.5% decrease in April after a steep slump in the first quarter. VW’s U.S. sales fell by 35% last month in the same period.

The lack of demand in Europe isn’t just hurting car dealerships, according to Stackmann. “That’s why we need a broad stimulus program for the entire economy that restores trust among people,” he said.

Uber to cut 3,700 jobs, adding to growing number of tech layoffs #ศาสตร์เกษตรดินปุ๋ย

Published May 10, 2020 by SoClaimon

#ศาสตร์เกษตรดินปุ๋ย : ขอบคุณแหล่งข้อมูล : หนังสือพิมพ์ The Nation.

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Uber to cut 3,700 jobs, adding to growing number of tech layoffs

May 07. 2020
By The Washington Post · Rachel Lerman · BUSINESS, TECHNOLOGY 

Uber said it will layoff 3,700 employees, or about 14% of its workforce, as the company faces an uncertain future in the face of the novel coronavirus pandemic.

The San Francisco-based company confirmed in a Securities and Exchange Commission filing that fewer people are taking rides in the time of covid-19, the disease caused by the virus. The company has implemented a hiring freeze in addition to cutting thousands of jobs from its customer service and recruiting teams, it said in the filing.

Uber said it expects to spend about $20 million on severance and other benefits for the laid-off employees. CEO Dara Khosrowshahi will not be paid for the rest of the year. His salary was set for $1 million in 2019, with a possible $2 million bonus.

“Days like this are brutal,” Khosrowshahi wrote in an email sent to all employees Wednesday. “I am truly sorry that we are doing this, just as I know that we have to do this.”

Uber’s announcement follows similar cuts by tech companies Lyft and Airbnb, fellows in the on-demand economy that has taken a plunge as people stay at home and try to avoid contact with others.

Lyft said last week it would lay off nearly 1,000 people, or 17% of its staff, as the pandemic cuts into its revenue. Airbnb has started cutting 25% of its workforce, or about 1,900 people, CEO Brian Chesky said in an email to employees Tuesday.

Uber and Lyft both went public last year in disappointing debuts that revealed the darlings of the private markets, who had each raised billions in private-market funding before their IPOs, faced tougher-than-expected scrutiny once public.

Uber’s stock price fell more than 4% to $26.90 per share after the layoffs were announced Wednesday.

Airbnb said last year that it planned to go public during 2020, though it’s unclear what type of reception the company would face if it moves forward with the plan. It secured a $1 billion loan from investors last month.

Airbnb spokesman Nick Papas declined to comment on any updated IPO plans.

Uber spokesperson Lois van der Laan said in a statement the “unfortunate reality” is there isn’t enough work for many customer support employees because people are riding less. Lyft spokesperson Alexandra LaManna said the company had nothing further to share from its layoff announcement last week.

The three companies all rely on people sharing a close space with others – drivers and passengers in Uber and Lyft rides, and vacationers in Airbnb homes where owners often live or have recently left. That proximity has become a liability at a time where people are cautioned or ordered to keep their distance from others.

One exception is Uber Eats, the company’s restaurant delivery arm, where executives said demand has surged.

Uber is also closing 180 locations, or 40%, of its Greenlight Hubs, the physical locations where drivers can go for help on things such as onboarding or using the app. Uber temporarily closed all U.S. locations in March due to the pandemic.

Uber and Lyft rely heavily on contracted drivers to power their businesses. By classifying their drivers as contractors rather than employees, the companies are protected from some liability and offering full benefits. But the designation has been controversial, as critics say it means less protection when work dwindles. California sued Uber and Lyft on Tuesday, alleging the drivers are misclassified as independent contractors under a new state law.

On a call with analysts after announcing quarterly earnings Wednesday, Lyft chief executive Logan Green said ride-hail trips on the app were down 75% in April, and the company could not accurately predict the economic impact of the pandemic on its business. While the decline in rides has stabilized, he said, trips are still down about 70% – even as some began to return to the app in cities that loosened restrictions. Citing record unemployment, he said, “we expect driver supply to outstrip rider demand” for the foreseeable future.

“These are the hard truths we’re facing,” he added. Lyft reported a $398 million loss during its quarterly earnings Wednesday, narrowed from a $1.1 billion loss a year ago during a quarter that included IPO costs. The company said its revenue grew 23% compared with the same quarter last year, to $956 million.

The stock surged more than 15% after hours on better-than-expected results.

Analysts for Wedbush Securities wrote in a note Wednesday that while some people will start using the ride-hailing services again as the country recovers from the pandemic, others will never return.

“On the ride sharing front, Uber and Lyft face Herculean-like challenges looking ahead as the new reality will likely change the business models of these companies (and competitors) for the foreseeable future,” the analysts said.

At the same time, other businesses relying on gig workers have surged. On-demand shopping app Instacart said it would try to hire 300,000 shoppers this spring. And Big Tech companies – notably Amazon, which has hired 175,000 warehouse workers and delivery drivers – are expected to emerge from the crisis potentially more powerful. (Amazon chief executive founder Jeff Bezos owns The Washington Post.)

Meanwhile, more than 42,000 people have been laid off from small tech companies since March 11, according to Silicon Valley layoff tracker Layoffs.fyi.

Lyft will announce its quarterly earnings Wednesday, and Uber will do so Thursday.

A massive drop in car sales sparks new push in Congress to aid the auto industry #ศาสตร์เกษตรดินปุ๋ย

Published May 10, 2020 by SoClaimon

#ศาสตร์เกษตรดินปุ๋ย : ขอบคุณแหล่งข้อมูล : หนังสือพิมพ์ The Nation.

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A massive drop in car sales sparks new push in Congress to aid the auto industry

May 06. 2020
Photo credit: PxHere

Photo credit: PxHere
By The Washington Post · Tony Romm ·

A precipitous decline in car sales amid the deadly coronavirus outbreak has caught the attention of Capitol Hill, where some lawmakers are now urging Congress to authorize new aid for the auto industry.

With consumers spending less, and factories nationwide shuttered or severely hamstrung, Democrats and Republicans largely representing the hard-hit, auto heavy-Midwest are leading an early push to persuade their colleagues to help manufacturers and suppliers as part of a future pandemic relief package. Absent that assistance, they warn that massive losses could leave workers unemployed and stall any economic recovery.

To make their case, lawmakers including Reps. Marcy Kaptur, D-Ohio, Debbie Dingell, D-Mich., and Fred Upton, R-Mich., began circulating a draft letter Tuesday emphasizing that the “projected economic fallout for the industry is grave,” according to a copy obtained by The Washington Post.

In some cases, they said, the challenges facing the automotive ecosystem “exceed those of the 2008 financial meltdown,” referring to the recession more than a decade ago that ultimately yielded an approximately $80 billion auto industry bailout.

The heightened push on Capitol Hill comes as the industry grapples with steep, unexpected losses: Car sales were down about 40 percent just last week, according to J.D. Power, which monitors the industry. Since the outbreak began in March, retailers have sold nearly 800,000 vehicles fewer than initially forecast, the firm said.

The shortfalls also have touched off an early lobbying scramble on the part of the motor vehicle industry, which spans manufacturers and dealerships, parts suppliers and rental-car companies. One idea that has been discussed among lawmakers and industry is the creation of a new federal program that might persuade penny-pinching Americans to purchase new vehicles, according to two congressional aides who spoke on the condition of anonymity to describe private conversations.

“It is conceivable, given where we are today, and depending on the extent to which the industry remains at these very low levels, that we might need to see some priming of the pump,” said John Bozzella, the president of the Alliance for Automotive Innovation, which represents Ford, General Motors, Fiat-Chrysler and others.

Bozzella said the organization is “looking at whether demand stimulus is necessary given the prolonged shock to automotive demand,” though he said exactly what it entails “is still an open question.”

For the auto industry, which employs more than 10 million workers in a wide array of fields, the economic challenges wrought by the coronavirus have proved immediate and immense. Purchases have picked up in recent days following a huge drop in March, particularly because of consumer-friendly financing options on the part of desperate sellers. But Tyson Jominy, the vice president of data and analytics at J.D. Power, wagered the sharp decline at the moment still is “as bad or worse” in the short term as the troubles the industry faced during the 2008 recession.

Driving the downturn is a growing reticence among consumers to make large purchases at a moment when their jobs and incomes are far from guaranteed. More than 30 million Americans filed unemployment claims in the past six weeks, marking the worst economic downturn since the Great Depression – and one that may only worsen if the coronavirus outbreak continues unabated.

Adding to the industry’s burdens are stay-at-home orders, which have forced many car manufacturers, suppliers and dealerships to close for months. Some states have recently reopened for business, hoping to get workers back on the job while reviving local shopping and commerce. But many critical manufacturing hubs, including the auto epicenter of Michigan, remain closed out of concern that factory floors could facilitate the spread of the disease known as covid-19.

Those imminent troubles ultimately led Moody’s Investors Service in recent weeks to issue dour forecasts for two major U.S. automakers. The credit ratings firm downgraded Ford and said it is considering a similar action targeting GM. In doing so, analysts predicted “severe disruption” in demand for new vehicles compounded by further widespread economic shocks still to come. The two major automakers declined to comment, as did a third, Fiat-Chrysler.

In response, lawmakers representing major auto manufacturing hubs have started sounding off in recent days, seeking to ensure the industry’s woes don’t further exacerbate local economic hardships. Michigan, for example, already is facing a budget crisis and a sky-high unemployment rate that has left about a quarter of the state’s eligible workers seeking jobless benefits. Some of the state’s representatives in Congress now say that carmakers and others deserve the same attention afforded to the airline industry and others hit hard by the coronavirus.

“Members of Congress are going to be focused on the drivers of their regional economy,” said Democratic Rep. Haley Stevens. She said an early focus is on ways to “address the drop in sales, and what that means for future legislative action.”

More than a decade ago, Stevens had a front-row seat to the last collapse facing the auto industry. She had served as a top official to a task force, assembled by President Barack Obama, to review the bailout of Chrysler and General Motors. It was during that period that the U.S. government ultimately authorized a federal program to stimulate car purchases, known as “Cash for Clunkers,” which proved popular but sparked Republican criticism.

With the coronavirus once again cutting deep into automakers’ bottom lines, Stevens cautioned: “I don’t think this is 2008,” pointing to the fact that structural factors leading to bankruptcy aren’t to blame for the industry’s misfortune. But she said the bleak financial situation “still warrants a discussion on how to potentially stimulate sales.”

“I don’t think anybody wants a handout,” Dingell, who served in a top role at GM before arriving in Congress, said in an interview. “If we’re going to get business up and running again, there’s got to be demand for goods.”

Automakers, much like other industries, are able to take advantage of billions of dollars authorized under the $2 trillion Cares Act adopted by Congress in late March. But lawmakers, in their draft letter, signaled support for additional relief specifically set aside for the industry.

“Given the enormity of the industry’s economic footprint throughout our nation and its significant legacy, we seek your assurance that an appropriate response will be included so that American workers in the automotive industry can help drive a robust recovery,” wrote lawmakers including Stevens, Kaptur, Dingell, Upton, Daniel Kildee, D-Mich., and Terri Sewell, D-Ala.

Many on Capitol Hill – along with those who work for automakers and the network that supplies them – are careful to stress they aren’t seeking a bailout, as they seek to avoid the same political blowback they faced during the last economic crisis. But some in the industry have not been shy at times from seeking policy changes that might ease some of the economic havoc facing their businesses.

The Alliance for Automotive Innovation this week joined dozens of other groups across industries in calling for congressional legislation that may shield them from lawsuits in the event they restart operations and workers become sick from the coronavirus. Republican leaders have endorsed such liability protections despite Democratic opposition.

A trade group for tire manufacturers, meanwhile, asked Congress in late April to help it tackle a raft of “unprecedented challenges,” including by enacting a payroll tax holiday. Lobbyists for truck dealerships similarly sought to lessen their tax burden amid declining demand. Suppliers asked the Trump administration for tariff relief last week.

And many groups throughout the ecosystem have lobbied for months to persuade the U.S. government to categorize a wide array of their workers as essential. They’ve also ramped up their efforts in Michigan, where the Motor and Equipment Manufacturers Association on April 30 asked Democratic Gov. Gretchen Whitmer for the ability to open five days before manufacturers so they have a start on supplying critical parts. The group did not respond to a request for comment.

“The industry was doing real well. We had come out of the slump in 2008,” said Kaptur, whose Ohio district includes and is close to a number of auto manufacturing facilities. “If we could help the airline industry, what about the motor vehicle industry?”

Elon Musk launches into expletive-laden rant, calling quarantine measures ‘fascist’ #ศาสตร์เกษตรดินปุ๋ย

Published May 10, 2020 by SoClaimon

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Elon Musk launches into expletive-laden rant, calling quarantine measures ‘fascist’

Apr 30. 2020
File photo of Elon  Musk

File photo of Elon Musk
By The Washington Post · Faiz Siddiqui · BUSINESS, TECHNOLOGY, US-GLOBAL-MARKETS 

Elon Musk launched into an expletive-laden rant on Tesla’s earnings call Wednesday, calling shelter-in-place orders “fascist” and demanding political officials give back their freedom.

“To say that they cannot leave their house and they will be arrested if they do, this is fascist,” he said, before the call abruptly cut out. “This is not democratic-this is not freedom.”

The company was forced to shut down its Fremont, California, factory just as it was ramping up production for its Model Y, the crossover vehicle it expects to be its best-selling product.

The comments followed Tesla posting a slight profit Wednesday, a lukewarm signal as worries mounted about the electric carmaker’s trajectory amid the global pandemic.

The company said first-quarter profit came in at $16 million, down compared with the past two consecutive quarters. In the same quarter a year ago, the company reported a $702 million loss. The company’s nearly $6 billion in quarterly revenue was up 32 percent year over year.

The company in early April already reported a record first quarter for production and deliveries of its vehicles lineup, consisting of the Models S, X, 3 and Y. Still, analysts have cautioned that the pandemic is likely to slice into production an render unlikely its target of half a million vehicles built in 2020.

Tesla echoed that concern, saying it might not hit that target due to the coronavirus. It also warned cash flow and net income might be difficult to predict, so it would revisit its yearly guidance next quarter.

“It is difficult to predict how quickly vehicle manufacturing and its global supply chain will return to prior levels,” Tesla said. “We have the capacity installed to exceed 500,000 vehicle deliveries this year, despite announced production interruptions. For our U.S. factories, it remains uncertain how quickly we and our suppliers will be able to ramp production after resuming operations.”

Chief financial officer Zachary Kirkhorn said Tesla is closely assessing the impact of the covid-19 downturn.

“In Fremont we’re working toward restarting production as soon as that’s possible,” he said. “However, unavoidably, the extended shutdown in Fremont will have an impact on our [near-term] financial performance.”

In response to a question about what the company had learned from the crisis, Musk said Tesla had started spending more efficiently.

“It has caused us to look closely at our cost structure and to be more efficient as a company,” he said. “We came to the conclusion that the right move is actually to continue to expand rapidly, continue to invest in the future in new technologies, even though it is risky.”

Still, Tesla’s stock rose more than 7 percent in after hours trading to $861.07 as investors applauded the profit.

The record first-quarter performance surprised investors and analysts, who expected the company to have suffered some preliminary impacts from the global impacts of the coronavirus, which ravaged China before the first cases of local transmission were reported in the U.S. toward the end of February.

Analyst Dan Ives of Wedbush Securities said that Tesla’s ability to turn a profit in an environment constrained by covid-19 sent the market a strong signal of the company’s financial viability that sent the stock surging.

“The fact that they’re navigating that storm as well as they are, now you’re gonna have a stock that’s going to start to make it’s trek toward a thousand dollars,” he said.

Tesla began delivering its Model Y crossover in March, in a muted debut that coincided with widespread social distancing and shelter-in-place orders aimed at slowing the spread of the virus. Wednesday’s earnings report was the first indicator of demand for the small SUV, which has long been expected to be strong due to U.S. preference for that type of vehicle. Tesla said the crossover became the “first time in our history that a new product has been profitable in its first quarter.”

The Y’s debut may have provided some insight into why Musk initially resisted efforts to close businesses in the Bay Area, where Tesla is headquartered. Only after substantial intervention from local authorities last month did Musk agree to close up shop at its Fremont, California, factory.

Tuesday night, ahead of the earnings release, Musk repeatedly encouraged business to reopen, at one point tweeting “FREE AMERICA NOW.” The tweet drew the ire of some elected officials who said Musk’s antics showed he was willing put the health of Americans at risk for personal gain.

Tesla rounded out 2019 with two straight quarters of profits after meeting the low end of its vehicle delivery targets on its mass-market Model 3, though it posted an annual loss.

“By all accounts, 2020 was supposed to be Tesla’s year,” Jessica Caldwell, executive director of insights with research group Edmunds, said in a statement. “Its Shanghai factory was up and running, Model Y production and deliveries were ahead of schedule, and the company was making money while expanding its product lineup and operations. COVID-19 essentially robbed what would’ve been a home run for Elon Musk, so it’s unsurprising that he’s been leaning into the ‘Free America’ rhetoric on Twitter.”

While some “die hards” will stick with the brand, Tesla faces problems including cheaper gas and a recession likely to cut into pocketbooks, said Karl Brauer, an auto industry analyst who serves as executive publisher at Cox Automotive. Luxury brands, which count Tesla among their ranks, tend to suffer during recessions.

“We looked like we were on the cusp of electric vehicles moving from niche to something more than niche,” Brauer said. “Nobody with a grounded perspective thinks that was has happened in the last two months is good for electric vehicles.”

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