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“Tesla of China” NIO cancels plans to build a local factory after heavy 2018 losses

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NIO, the Chinese electric vehicle startup with its eyes set on Tesla’s luxury auto market consumers, revealed some production stumbling blocks in a press release on Tuesday detailing its Fourth Quarter and Full Year 2018 Financial Results. One of the most notable points of interest was its decision to cancel plans to build a Shanghai manufacturing facility in favor of continuing to contract work to state-owned JAC Motors. The report also revealed $1.4 billion in losses, doubling the losses experienced in 2017, despite meeting production and delivery goals for the year.

Even without having a factory to call its own, NIO currently has two SUV vehicles for sale, the ES8 and coming ES6. Having a deal with the government – one where the government makes a product for a company rather than the other way around – may seem unusual, especially in the US. However, it’s par for the course in China. In a call with investors following the news release Tuesday, NIO chief financial officer Luis Hsieh commented that such arrangements are “endorsed and perceived as an innovative manufacturing model in China.” As a result, NIO has been able to put vehicles on the road quickly, giving it an edge over the extensive competition in the country.

It’s also interesting to note that NIO represents one of hundreds of China-based EV companies hoping to cash in on Chinese government incentives driving the ramp up of the all-electric car market. With 5 million annual EV sales expected to come from China in the near future, startups like NIO and established electric brands like Tesla are eyeing a bright future full of growth. Tesla’s Shanghai-based Gigafactory 3 is a nod to their high sales expectations in the country.

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NIO’s ES6 electric SUV command panel. | Credit: NIO

NIO’s deal with JAC Motors is apparently hurting its bottom line, however. Along with a fee collected by the manufacturer for each vehicle produced, NIO is required to compensate JAC for any operating losses during the first 3 years of production. If that’s not enough eating away at the company’s progress, slow January/February markets, tough trading conditions resulting from the ongoing US-China trade war, and end-of-year sales ramps in 2018 are being offered by NIO as reasons for a delivery slowdown in the early part of this year. The company expects the slowdowns to continue into the second quarter of 2019 for largely the same reasons.

The bad financial news from NIO is perhaps a bit surprising considering that the announcement is on the heels of a 60 Minutes feature wherein CEO William Li was hopeful for the company’s prospects in China’s EV market. NIO has been positioned as a lifestyle company rather than simply a car maker, offering exclusive owner perks like clubhouses and on-demand charging solutions. Li’s plans also include eventual entry into the international market, and the company already has offices around the world seemingly to aid in this effort.

Perhaps without Tesla’s experiences coming to market shining a light on what’s possible during a new EV manufacturer’s development path, news like NIO’s announcement would immediately spell impending doom for such a new company in a still-evolving market. That is not quite the case, of course, and NIO, along with the numerous EV startups begun in Tesla’s wake, have essentially a wealth of information available to learn from as applicable to their national situations. Even still, just as Tesla and SpaceX CEO Elon Musk often stated that “rockets are hard” despite decades of space launching knowledge being available, so too are electric vehicle companies.

Accidental computer geek, fascinated by most history and the multiplanetary future on its way. Quite keen on the democratization of space. | It's pronounced day-sha, but I answer to almost any variation thereof.

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Tesla engineers deflected calls from this tech giant’s now-defunct EV project

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Image Created by Grok

Tesla engineers deflected calls from Apple on a daily basis while the tech giant was developing its now-defunct electric vehicle program, which was known as “Project Titan.”

Back in 2022 and 2023, Apple was developing an EV in a top-secret internal fashion, hoping to launch it by 2028 with a fully autonomous driving suite.

However, Apple bailed on the project in early 2024, as Project Titan abandoned the project in an email to over 2,000 employees. The company had backtracked its expectations for the vehicle on several occasions, initially hoping to launch it with no human driving controls and only with an autonomous driving suite.

Apple canceling its EV has drawn a wide array of reactions across tech

It then planned for a 2028 launch with “limited autonomous driving.” But it seemed to be a bit of a concession at that point; Apple was not prepared to take on industry giants like Tesla.

Wedbush’s Dan Ives noted in a communication to investors that, “The writing was on the wall for Apple with a much different EV landscape forming that would have made this an uphill battle. Most of these Project Titan engineers are now all focused on AI at Apple, which is the right move.”

Apple did all it could to develop a competitive EV that would attract car buyers, including attempting to poach top talent from Tesla.

In a new podcast interview with Tesla CEO Elon Musk, it was revealed that Apple had been calling Tesla engineers nonstop during its development of the now-defunct project. Musk said the engineers “just unplugged their phones.”

Musk said in full:

“They were carpet bombing Tesla with recruiting calls. Engineers just unplugged their phones. Their opening offer without any interview would be double the compensation at Tesla.”

Interestingly, Apple had acquired some ex-Tesla employees for its project, like Senior Director of Engineering Dr. Michael Schwekutsch, who eventually left for Archer Aviation.

Tesla took no legal action against Apple for attempting to poach its employees, as it has with other companies. It came after EV rival Rivian in mid-2020, after stating an “alarming pattern” of poaching employees was noticed.

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Tesla to a $100T market cap? Elon Musk’s response may shock you

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There are a lot of Tesla bulls out there who have astronomical expectations for the company, especially as its arm of reach has gone well past automotive and energy and entered artificial intelligence and robotics.

However, some of the most bullish Tesla investors believe the company could become worth $100 trillion, and CEO Elon Musk does not believe that number is completely out of the question, even if it sounds almost ridiculous.

To put that number into perspective, the top ten most valuable companies in the world — NVIDIA, Apple, Alphabet, Microsoft, Amazon, TSMC, Meta, Saudi Aramco, Broadcom, and Tesla — are worth roughly $26 trillion.

Will Tesla join the fold? Predicting a triple merger with SpaceX and xAI

Cathie Wood of ARK Invest believes the number is reasonable considering Tesla’s long-reaching industry ambitions:

“…in the world of AI, what do you have to have to win? You have to have proprietary data, and think about all the proprietary data he has, different kinds of proprietary data. Tesla, the language of the road; Neuralink, multiomics data; nobody else has that data. X, nobody else has that data either. I could see $100 trillion. I think it’s going to happen because of convergence. I think Tesla is the leading candidate [for $100 trillion] for the reason I just said.”

Musk said late last year that all of his companies seem to be “heading toward convergence,” and it’s started to come to fruition. Tesla invested in xAI, as revealed in its Q4 Earnings Shareholder Deck, and SpaceX recently acquired xAI, marking the first step in the potential for a massive umbrella of companies under Musk’s watch.

SpaceX officially acquires xAI, merging rockets with AI expertise

Now that it is happening, it seems Musk is even more enthusiastic about a massive valuation that would swell to nearly four-times the value of the top ten most valuable companies in the world currently, as he said on X, the idea of a $100 trillion valuation is “not impossible.”

Tesla is not just a car company. With its many projects, including the launch of Robotaxi, the progress of the Optimus robot, and its AI ambitions, it has the potential to continue gaining value at an accelerating rate.

Musk’s comments show his confidence in Tesla’s numerous projects, especially as some begin to mature and some head toward their initial stages.

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Celebrating SpaceX’s Falcon Heavy Tesla Roadster launch, seven years later (Op-Ed)

Seven years later, the question is no longer “What if this works?” It’s “How far does this go?”

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SpaceX's first Falcon Heavy launch also happened to be a strategic and successful test of Falcon upper stage coast capabilities. (SpaceX)

When Falcon Heavy lifted off in February 2018 with Elon Musk’s personal Tesla Roadster as its payload, SpaceX was at a much different place. So was Tesla. It was unclear whether Falcon Heavy was feasible at all, and Tesla was in the depths of Model 3 production hell.

At the time, Tesla’s market capitalization hovered around $55–60 billion, an amount critics argued was already grossly overvalued. SpaceX, on the other hand, was an aggressive private launch provider known for taking risks that traditional aerospace companies avoided.

The Roadster launch was bold by design. Falcon Heavy’s maiden mission carried no paying payload, no government satellite, just a car drifting past Earth with David Bowie playing in the background. To many, it looked like a stunt. For Elon Musk and the SpaceX team, it was a bold statement: there should be some things in the world that simply inspire people.

Inspire it did, and seven years later, SpaceX and Tesla’s results speak for themselves.

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Credit: SpaceX

Today, Tesla is the world’s most valuable automaker, with a market capitalization of roughly $1.54 trillion. The Model Y has become the best-selling car in the world by volume for three consecutive years, a scenario that would have sounded insane in 2018. Tesla has also pushed autonomy to a point where its vehicles can navigate complex real-world environments using vision alone.

And then there is Optimus. What began as a literal man in a suit has evolved into a humanoid robot program that Musk now describes as potential Von Neumann machines: systems capable of building civilizations beyond Earth. Whether that vision takes decades or less, one thing is evident: Tesla is no longer just a car company. It is positioning itself at the intersection of AI, robotics, and manufacturing.

SpaceX’s trajectory has been just as dramatic.

The Falcon 9 has become the undisputed workhorse of the global launch industry, having completed more than 600 missions to date. Of those, SpaceX has successfully landed a Falcon booster more than 560 times. The Falcon 9 flies more often than all other active launch vehicles combined, routinely lifting off multiple times per week.

Falcon Heavy successfully clears the tower after its maiden launch, February 6, 2018. (Tom Cross)

Falcon 9 has ferried astronauts to and from the International Space Station via Crew Dragon, restored U.S. human spaceflight capability, and even stepped in to safely return NASA astronauts Butch Wilmore and Suni Williams when circumstances demanded it.

Starlink, once a controversial idea, now dominates the satellite communications industry, providing broadband connectivity across the globe and reshaping how space-based networks are deployed. SpaceX itself, following its merger with xAI, is now valued at roughly $1.25 trillion and is widely expected to pursue what could become the largest IPO in history.

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And then there is Starship, Elon Musk’s fully reusable launch system designed not just to reach orbit, but to make humans multiplanetary. In 2018, the idea was still aspirational. Today, it is under active development, flight-tested in public view, and central to NASA’s future lunar plans.

In hindsight, Falcon Heavy’s maiden flight with Elon Musk’s personal Tesla Roadster was never really about a car in space. It was a signal that SpaceX and Tesla were willing to think bigger, move faster, and accept risks others wouldn’t.

The Roadster is still out there, orbiting the Sun. Seven years later, the question is no longer “What if this works?” It’s “How far does this go?”

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