News
“Boring” EQC fails to provide Mercedes-Benz with EV momentum
The Mercedes-Benz EQC was supposed to be the German automaker’s answer to Tesla’s emergence as the dominant force in electric transportation. After an introduction that could only be described as a disappointment, Mercedes’ parent company Daimler’s Shareholder meeting on Wednesday revealed how some investors felt about the EQC’s underwhelming performance.
“Too late, too expensive, and too boring,” Speich said about the EQC, which has had less-than-desirable sales figures, according to the German Federal Motor Transport Authority.
In 2019, only 397 units of the EQC were sold, and as of May 28, 2020, an additional 276 have been sold. The combination of these two figures is indicative of less than 700 units sold since the vehicle’s launch in late 2019.
2019 was a rough year for Daimler, and the EQC undoubtedly contributed to the struggles the automaker felt over the previous twelve months. Deka Investment, which holds about 5.4 million shares of Daimler stock, was vocal when the EQC came to light during the Shareholder meeting.
The all-electric EQC was released last year, and Deka’s Head of Sustainability and Corporate Governance Ingo Speich had prepared remarks that broke down the disappointing performance of the car, Yahoo reported.
Not all is bad for Mercedes-Benz, though. The company’s deliveries in China climbed to a record in Q2 2020, and truck and global car sales rose in June compared to the same month in 2019. The company did state that it will not turn a profit in the quarter due to the coronavirus, which halted the automaker’s momentum that included a plan to implement “thousands” of efficiency measures, according to Daimler CEO Ola Kallenius.
“Our previous efficiency goals covered the upcoming transformation, but not a global recession,” Kallenius said. “Daimler can do better, and we are determined to deliver.”
Mercedes will unveil the compact EQA electric car later this year, Kallenius said. The luxury car company will also offer five electric models and more than 20 plug-in hybrids by the end of the year. The push toward electrification is geared toward meeting strict European emissions rules in 2020 and 2021. Kallenius stated that reaching the CO2 limits will be “challenging.”
Daimler shares have declined by 24% so far in 2020, giving the company a market cap of €40 billion, or $45.3 billion. This figure is less than 20% of Tesla’s $257.26 billion market cap.
Daimler also announced a restructuring plan in November that foresaw the elimination of more than 10,000 jobs worldwide. The move will save the company €1.4 billion, or $1.58 billion in personnel spending by 2022.
Although the EQC did not live up to the hype that Mercedes-Benz expected, there is still hope. With the German automaker planning to produce several more fully-electric models and a broad spectrum of hybrid vehicles in the future, the push toward a sustainable fleet is still within reason. Mercedes has a long history of manufacturing luxury automobiles, and shifting to electric transportation presents a variety of exciting challenges that have stumped some of the biggest car companies in the world, like Volkswagen.
There is room for improvement, but the EQC is not necessarily an indicator of what Mercedes-Benz has to offer. The company must learn from the underwhelming performance of the EQC and push for the development of more advanced EV technologies for its future models.
Elon Musk
SpaceX issues statement on Starship V3 Booster 18 anomaly
The incident unfolded during gas-system pressure testing at the company’s Massey facility in Starbase, Texas.
SpaceX has issued an initial statement about Starship Booster 18’s anomaly early Friday. The incident unfolded during gas-system pressure testing at the company’s Massey facility in Starbase, Texas.
SpaceX’s initial comment
As per SpaceX in a post on its official account on social media platform X, Booster 18 was undergoing gas system pressure tests when the anomaly happened. Despite the nature of the incident, the company emphasized that no propellant was loaded, no engines were installed, and personnel were kept at a safe distance from the booster, resulting in zero injuries.
“Booster 18 suffered an anomaly during gas system pressure testing that we were conducting in advance of structural proof testing. No propellant was on the vehicle, and engines were not yet installed. The teams need time to investigate before we are confident of the cause. No one was injured as we maintain a safe distance for personnel during this type of testing. The site remains clear and we are working plans to safely reenter the site,” SpaceX wrote in its post on X.
Incident and aftermath
Livestream footage from LabPadre showed Booster 18’s lower half crumpling around the liquid oxygen tank area at approximately 4:04 a.m. CT. Subsequent images posted by on-site observers revealed extensive deformation across the booster’s lower structure. Needless to say, spaceflight observers have noted that Booster 18 would likely be a complete loss due to its anomaly.
Booster 18 had rolled out only a day earlier and was one of the first vehicles in the Starship V3 program. The V3 series incorporates structural reinforcements and reliability upgrades intended to prepare Starship for rapid-reuse testing and eventual tower-catch operations. Elon Musk has been optimistic about Starship V3, previously noting on X that the spacecraft might be able to complete initial missions to Mars.
Investor's Corner
Tesla analyst maintains $500 PT, says FSD drives better than humans now
The team also met with Tesla leaders for more than an hour to discuss autonomy, chip development, and upcoming deployment plans.
Tesla (NASDAQ:TSLA) received fresh support from Piper Sandler this week after analysts toured the Fremont Factory and tested the company’s latest Full Self-Driving software. The firm reaffirmed its $500 price target, stating that FSD V14 delivered a notably smooth robotaxi demonstration and may already perform at levels comparable to, if not better than, average human drivers.
The team also met with Tesla leaders for more than an hour to discuss autonomy, chip development, and upcoming deployment plans.
Analysts highlight autonomy progress
During more than 75 minutes of focused discussions, analysts reportedly focused on FSD v14’s updates. Piper Sandler’s team pointed to meaningful strides in perception, object handling, and overall ride smoothness during the robotaxi demo.
The visit also included discussions on updates to Tesla’s in-house chip initiatives, its Optimus program, and the growth of the company’s battery storage business. Analysts noted that Tesla continues refining cost structures and capital expenditure expectations, which are key elements in future margin recovery, as noted in a Yahoo Finance report.
Analyst Alexander Potter noted that “we think FSD is a truly impressive product that is (probably) already better at driving than the average American.” This conclusion was strengthened by what he described as a “flawless robotaxi ride to the hotel.”
Street targets diverge on TSLA
While Piper Sandler stands by its $500 target, it is not the highest estimate on the Street. Wedbush, for one, has a $600 per share price target for TSLA stock.
Other institutions have also weighed in on TSLA stock as of late. HSBC reiterated a Reduce rating with a $131 target, citing a gap between earnings fundamentals and the company’s market value. By contrast, TD Cowen maintained a Buy rating and a $509 target, pointing to strong autonomous driving demonstrations in Austin and the pace of software-driven improvements.
Stifel analysts also lifted their price target for Tesla to $508 per share over the company’s ongoing robotaxi and FSD programs.
Elon Musk
SpaceX Starship Version 3 booster crumples in early testing
Photos of the incident’s aftermath suggest that Booster 18 will likely be retired.
SpaceX’s new Starship first-stage booster, Booster 18, suffered major damage early Friday during its first round of testing in Starbase, Texas, just one day after rolling out of the factory.
Based on videos of the incident, the lower section of the rocket booster appeared to crumple during a pressurization test. Photos of the incident’s aftermath suggest that Booster 18 will likely be retired.
Booster test failure
SpaceX began structural and propellant-system verification tests on Booster 18 Thursday night at the Massey’s Test Site, only a few miles from Starbase’s production facilities, as noted in an Ars Technica report. At 4:04 a.m. CT on Friday, a livestream from LabPadre Space captured the booster’s lower half experiencing a sudden destructive event around its liquid oxygen tank section. Post-incident images, shared on X by @StarshipGazer, showed notable deformation in the booster’s lower structure.
Neither SpaceX nor Elon Musk had commented as of Friday morning, but the vehicle’s condition suggests it is likely a complete loss. This is quite unfortunate, as Booster 18 is already part of the Starship V3 program, which includes design fixes and upgrades intended to improve reliability. While SpaceX maintains a rather rapid Starship production line in Starbase, Booster 18 was generally expected to validate the improvements implemented in the V3 program.
Tight deadlines
SpaceX needs Starship boosters and upper stages to begin demonstrating rapid reuse, tower catches, and early operational Starlink missions over the next two years. More critically, NASA’s Artemis program depends on an on-orbit refueling test in the second half of 2026, a requirement for the vehicle’s expected crewed lunar landing around 2028.
While SpaceX is known for diagnosing failures quickly and returning to testing at unmatched speed, losing the newest-generation booster at the very start of its campaign highlights the immense challenge involved in scaling Starship into a reliable, high-cadence launch system. SpaceX, however, is known for getting things done quickly, so it would not be a surprise if the company manages to figure out what happened to Booster 18 in the near future.
SpaceX issues statement on Starship V3 Booster 18 anomaly
Tesla analyst maintains $500 PT, says FSD drives better than humans now
