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Fiat Could Build Model 3 Rival in 12 Months Claims Its CEO

FiatChrysler chairman Sergio Marchionne said at the company’s annual meeting last Friday that if the Model 3 is profitable, Fiat could build a car like it with Italian styling in 12 months.

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Sergio Marchionne says he could build a car like the Model 3 in 12 months.

Sergio Marchionne at FCA annual meeting in Amsterdam on April 15. Credit: FCA

Sergio Marchionne, CEO of FiatChrysler, said during the company’s annual meeting in Amsterdam last Friday that if Tesla can make money on the Model 3, Fiat will build a competitor and have it on the market within 12 months. Those are brave words for a man whose Chrysler division is planning to stop making mid size sedans entirely.

Saying he has nothing but the highest regard for Elon Musk, Marchionne also said, “I am not surprised by the high number of reservations” (400,000 and counting) for the Model 3. “But then the hard reality comes in … making cars, selling them and making money doing so.”He added, if Elon “can show me that the car will be profitable at that price, I will copy the formula, add the Italian design flair, and get it to the market within 12 months.”

Unlike most car company CEOs, who tend to speak in measured terms, Marchionne has a reputation for blurting out whatever is on his mind. His remarks are viewed by many as proof that he has little to no understanding of how the automotive market is shifting beneath his feet.

They see him as the poster boy for how most automakers are still clueless about the electric car revolution and have no effective plans to join it. Several compare traditional car companies to the likes of Kodak and Polaroid — industry giants who simply could not adapt fast enough to digital photography tehcnology. IBM is another prime example of a once mighty company decimated by technological change.

Just a few years ago, Marchionne was begging people not to buy the Fiat 500e electric car because his company lost $14,000 on every car sold. Earlier last week, he told Automotive News that he sees Toyota, Ford, or Volkswagen as companies that could potential merge with FiatChryler. In other words, Marchionne is looking for a suitor who will buy the company while it still has value.

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The decision to stop building the Dodge Dart and Chrysler 200 is instructive. By all accounts, both are pretty good cars that match up well against the competition. Neither has been particularly profitable, but the decision to stop making them is rooted in the arcane provisions of the federal regulations. Under the CAFE rules, the average fuel economy a company has to achieve varies according to the “footprint” of its fleet. The larger the vehicle it sells, the lower its CAFE numbers can be.

In this era of low gas prices, Chrysler is killing it with its Jeep lineup and sales of hulking pickup trucks. By ditching mid size sedans, it can sell more vehicles with atrocious gas mileage and be in compliance with CAFE mandates. At the very least, it will have to buy fewer credits from other companies. Does that sound like a company that it looking to the future?

There are so many problems with Marchionne’s position, it’s hard to know where to begin. The thought of a Model 3 clone that looks like an Alfa Romeo may have some surface appeal, but where is the network of recharging stations for customers travelling away from home? Where are the autonomous driving systems or the interior that will “feel like a spaceship,” in Elon’s words?

Is anyone at Tesla worried by Marchionne’s idle boast? If they are, they aren’t showing it.

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Source: Fortune, Photo credit: FCA.com

 

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xAI’s Grok approved for Pentagon classified systems: report

Under the agreement, Grok can be deployed in systems handling classified intelligence analysis, weapons development, and battlefield operations. 

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Credit: xAI

Elon Musk’s xAI has signed an agreement with the United States Department of Defense (DoD) to allow Grok to be used in classified military systems.

Previously, Anthropic’s Claude had been the only AI system approved for the most sensitive military work, but a dispute over usage safeguards has reportedly prompted the Pentagon to broaden its options, as noted in a report from Axios.

Under the agreement, Grok can be deployed in systems handling classified intelligence analysis, weapons development, and battlefield operations. 

The publication reported that xAI agreed to the Pentagon’s requirement that its technology be usable for “all lawful purposes,” a standard Anthropic has reportedly resisted due to alleged ethical restrictions tied to mass surveillance and autonomous weapons use.

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Defense Secretary Pete Hegseth is scheduled to meet with Anthropic CEO Dario Amodei in what sources expect to be a tense meeting, with the publication hinting that the Pentagon could designate Anthropic a “supply chain risk” if the company does not lift its safeguards. 

Axios stated that replacing Claude fully might be technically challenging even if xAI or other alternative AI systems take its place. That being said, other AI systems are already in use by the DoD. 

Grok already operates in the Pentagon’s unclassified systems alongside Google’s Gemini and OpenAI’s ChatGPT. Google is reportedly close to an agreement that will result in Gemini being used for classified use, while OpenAI’s progress toward classified deployment is described as slower but still feasible. 

The publication noted that the Pentagon continues talks with several AI companies as it prepares for potential changes in classified AI sourcing.

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Elon Musk denies Starlink’s price cuts are due to Amazon Kuiper

“This has nothing to do with Kuiper, we’re just trying to make Starlink more affordable to a broader audience,” Musk wrote in a post on X.

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Credit: Starlink

Elon Musk has pushed back on claims that Starlink’s recent price reductions are tied to Amazon’s Kuiper project.

In a post on X, Musk responded directly to a report suggesting that Starlink was cutting prices and offering free hardware to partners ahead of a planned IPO and increased competition from Kuiper.

“This has nothing to do with Kuiper, we’re just trying to make Starlink more affordable to a broader audience,” Musk wrote in a post on X. “The lower the cost, the more Starlink can be used by people who don’t have much money, especially in the developing world.”

The speculation originated from a post summarizing a report from The Information, which ran with the headline “SpaceX’s Starlink Makes Land Grab as Amazon Threat Looms.” The report stated that SpaceX is aggressively cutting prices and giving free hardware to distribution partners, which was interpreted as a reaction to Amazon’s Kuiper’s upcoming rollout and possible IPO.

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In a way, Musk’s comments could be quite accurate considering Starlink’s current scale. The constellation currently has more than 9,700 satellites in operation today, making it by far the largest satellite broadband network in operation. It has also managed to grow its user base to 10 million active customers across more than 150 countries worldwide. 

Amazon’s Kuiper, by comparison, has launched approximately 211 satellites to date, as per data from SatelliteMap.Space, some of which were launched by SpaceX’s Falcon 9 rocket. Starlink surpassed that number in early January 2020, during the early buildout of its first-generation network.

Lower pricing also aligns with Starlink’s broader expansion strategy. SpaceX continues to deploy satellites at a rapid pace using Falcon 9, and future launches aboard Starship are expected to significantly accelerate the constellation’s growth. A larger network improves capacity and global coverage, which can support a broader customer base.

In that context, price reductions can be viewed as a way to match expanding supply with growing demand. Musk’s companies have historically used aggressive pricing strategies to drive adoption at scale, particularly when vertical integration allows costs to decline over time.

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Tesla Giga Berlin makes a statement of solidarity amid IG Metall conflict

The display comes as tensions between Tesla and IG Metall continue to escalate.

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Creidt: Andre Thierig/X

Tesla Giga Berlin is sending a strong message of solidarity amid its ongoing legal dispute with German union IG Metall.

In a post on social media platform X, Giga Berlin plant manager André Thierig shared an image of the facility’s lobby covered with a large banner that reads: “Progress. Innovation. Success.” He added that the slogan reflects what the facility has stood for since Day One.

“Our lobby at Giga Berlin covered in a huge banner these days. Progress. Innovation. Success – this is what we stand for since we started production in 2022 and how we will go into our future!” Thierig wrote in his post on X. 

The display comes as tensions between Tesla and IG Metall continue to escalate.

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The dispute began after Tesla accused a union representative of secretly recording a works council meeting at Giga Berlin. Tesla stated that it filed a criminal complaint after the alleged incident. Police later confirmed they had seized a computer belonging to an IG Metall member as part of their investigation.

“What has happened today at Giga Berlin is truly beyond words! An external union representative from IG Metall attended a works council meeting. For unknown reasons he recorded the internal meeting and was caught in action! We obviously called police and filed a criminal complaint!” Thierig wrote on X at the time

IG Metall denied the accusation and characterized Tesla’s move as an election tactic ahead of upcoming works council elections. The union subsequently filed a defamation complaint against Thierig. Authorities later confirmed that an investigation had been opened in connection with the matter.

Giga Berlin began production in 2022 and has since become one of Tesla’s key European manufacturing hubs, producing the Model Y, the company’s best-selling vehicle. The facility has expanded capacity over the past years despite environmental protests, labor disputes, and regulatory scrutiny.

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