BEIJING/TOKYO (Reuters) – U.S. electric carmaker Tesla Inc <TSLA> plans to slash on-site staff at its Nevada battery plant by around 75% due to the coronavirus pandemic, the local county manager said on Thursday.
The move comes after its Japanese battery partner Panasonic Corp <6752.T> said it would scale down operations at the Nevada factory this week before closing it for 14 days.
The factory produces electric motors and battery packs for Tesla’s popular Model 3 sedans.
“Tesla has informed us that the Gigafactory in Storey County is reducing on-site staff by roughly 75% in the coming days,” Austin Osborne said in a post on the county’s website.
No further details were available and it was not clear how many employees work in the factory. Tesla did not immediately respond to a Reuters request for comment.
The Reno Gazette Journal, which earlier reported the planned suspension, said Panasonic has about 3,500 employees at the Nevada plant.
Tesla said last week it would temporarily suspend production at its vehicle factory in San Francisco Bay Area from end of March 23, as well as at its New York solar roof tile factory.
However, Tesla CEO Elon Musk said the company will reopen the New York plant “as soon as humanly possible” to manufacture ventilators for coronavirus patients.
Two employees of Tesla have tested positive for coronavirus but have been working from home for the past two weeks and had not been symptomatic at work, Tesla said in an email to employees on Thursday. It did not disclose which unit or at what location the employees work.
(Reporting by Yilei Sun and Makiko Yamazaki; Editing by Miyoung Kim and Himani Sarkar)
FILE PHOTO: A traveler checks her baggage at the Southwest Airlines terminal at LAX airport in Los Angeles
(Reuters) – The U.S. Federal Aviation Administration says it should have done a better job of ensuring Southwest Airlines Co <LUV> had certified completion of maintenance on 88 used Boeing 737 jets, as noted in a report by the U.S. Transportation Department’s Inspector General released on Tuesday.
Budget-friendly Southwest bought the planes in question between 2013 and 2017 from 16 foreign carriers.
The final report, first seen by Reuters, said Southwest operated more than 150,000 flights carrying 17.2 million passengers on the jets without confirmation that required maintenance had been completed.
The report said the FAA has not “effectively overseen Southwest Airlines’ systems for managing risks” and made 11 recommendations to improve oversight, including retraining inspectors and developing better control over maintenance records and inspector guidance on evaluating air carrier safety culture.
While the U.S. commercial airline industry is considered safe, with only one fatality in recent years, the FAA is under heightened scrutiny by lawmakers over its relationship with the industry after two crashes overseas on the newer Boeing Co <BA> 737 MAX killed 346 people and led to that aircraft’s global grounding.
“Given the significant unresolved safety concerns that FAA has identified at Southwest Airlines, it is clear that the agency is not yet effectively navigating the balance between industry collaboration and managing safety risks at the carrier,” the report said.
The FAA said in a response included with the report it concurred with all 11 recommendations and the inspector general’s conclusion that its office overseeing Southwest did not perform in accordance with existing guidance by allowing the 88 planes to enter service and that it “lacked a comprehensive conformity inspection for used aircraft.”
Southwest told Reuters on Tuesday that eight of the 88 jets remain out of service until needed repairs are completed and that it disagreed with the report’s findings.
The report chided the FAA, saying the agency “accepted the air carrier’s justification that the issues identified were low safety risks.”
The FAA noted it changed the leadership of its office that oversees Southwest and “continues to address deficiencies in the work functions and culture.” The agency has agreed to ensure Southwest “complies with regulatory requirements that the 88 previously owned aircraft conform to U.S. aviation standards.”
Last month, the Wall Street Journal published an article on a draft of the inspector general report.
The report also said the FAA violated its own guidance in addressing noncompliance by Southwest on baggage weight and balance data. The FAA agreed to ensure Southwest complies with requirements.
On Jan. 10, the FAA said it was seeking to impose a $3.92 million fine on Southwest for alleged weight infractions on 21,505 flights on 44 aircraft between May 1, 2018 and Aug. 9, 2018.
Southwest has said it is working with the FAA to demonstrate the effectiveness of its controls and seek a resolution on the proposed penalty.
Southwest shares closed up 0.9% on Tuesday, off intraday highs.
(Reporting by David Shepardson in Washington and Tracy Rucinski in Chicago; Editing by David Gregorio and Matthew Lewis)
FILE PHOTO: A Southwest Airlines Boeing 737 plane sits on the runway waiting to take off at LAX airport in Los Angeles
Workers leave the General Motors CAMI car assembly plant where the GMC Terrain and Chevrolet Equinox are built in Ingersoll
WASHINGTON (Reuters) – General Motors Co <GM> will revive the Hummer name to sell a new family of electric pickup trucks and sport utility vehicles and will tout the return with a Super Bowl ad featuring NBA star LeBron James, two people briefed on the matter said on Friday.
The vehicles will be sold under the GMC nameplate. Reuters reported in October that GM planned to build a new family of premium electric pickup trucks at its Detroit-Hamtramck plant beginning in late 2021 and was considering reviving the Hummer name, citing several people familiar with the plans.
The Wall Street Journal reported GM’s decision to move forward earlier on Friday. GM declined to comment.
The electric truck and SUV program is the centerpiece of a planned $3 billion investment in the Detroit-Hamtramck plant to make electric trucks and vans, and part of a broader $7.7 billion (5.9 billion pounds) investment in GM’s U.S. plants over the next four years that was part of a new contract signed with the United Auto Workers union last year.
The investment moves the automaker into a part of the EV market that is largely untested and where GM has a higher likelihood of turning a profit, analysts said.
Reuters reported GM plans to first build EV pickups in late 2021 and then an electric SUV in 2023.
Tesla <TSLA> CEO Elon Musk in November unveiled an electric pickup called “Cybertruck” it plans to build starting in late 2021.
Rivian, a start-up electric company backed by Amazon.com <AMZN>, will begin building 100,000 electric delivery vans for Amazon starting in 2021.
Hummers were rugged civilian utility vehicles with low gas mileage that were inspired by military vehicles and were popular with such celebrities as actor Arnold Schwarzenegger but derided by environmentalists as gas-guzzlers. GM shut down its Hummer brand after a deal to sell the SUV-line to an obscure Chinese machinery maker was blocked by Chinese regulators in 2010.
Michael Harley, executive editor for Kelley Blue Book, noted “the original Hummer was ostracized out of showrooms for being heavy and ponderous with an insatiable appetite for gasoline. An all-electric powertrain essentially exonerates the truck on all charges.”
Electric pickups and SUVs – the heart of the U.S. market – could help Ford Motor Co <F> and GM generate significant sales of EVs needed to meet tougher California emission standards and electric vehicle mandates.
The Trump administration is moving to roll back those standards – and eliminate extra credits that automakers receive from EV sales but electric trucks are a hedge if California prevails.
(Reporting by David Shepardson; Editing by Sandra Maler and Alistair Bell)
FILE PHOTO: The GM logo is seen at the General Motors Lansing Grand River Assembly Plant in Lansing.
WASHINGTON (Reuters) – General Motors Co <GM> confirmed on Monday it agreed to loan $40 million to an electric vehicle start-up to facilitate the acquisition of its shuttered Lordstown Assembly plant in Ohio.
Lordstown Motors Corp, which is 10% owned by Workhorse Group Inc <WKHS>, bought the plant and equipment for $20 million in November as part of its ambitious plan to begin building electric pickup trucks by the end of 2020.
The loan agreement, which was reported earlier Monday by the Business Journal in Youngstown, was filed in Trumbull County last week.
Lordstown Motors has been working on the engineering of the new truck, “Endurance”, and hired Rich Schmidt, a former director of manufacturing at Tesla Inc, as chief production officer.
“We structured the sales agreement to help support Lordstown Motors’ launch plans for the Endurance pickup,” GM spokesman Jim Cain said, who added it “allows them to take possession of the plant and to cover some operating expenses while they undertake their capital raise.”
GM is not investing in the venture, but Cain said GM financing could rise to $50 million.
The fate of the sprawling northeastern Ohio plant became a political lightning rod after GM announced its planned closure in November 2018, drawing condemnation from U.S. President Donald Trump and many U.S. lawmakers.
Lordstown CEO Steve Burns told Reuters last month he hopes to have pre-production prototypes coming off the assembly line by April and to start production by November 2020 with an initial workforce of 400 hourly workers.
Burns said last month the company hopes to raise more than $300 million, the Business Journal reported. Burns told Reuters it retained Ohio investment bank Brown Gibbons Lang & Co in its capital fundraising effort.
GM and South Korea’s LG Chem <051910.KS> said Thursday they will invest $2.3 billion to build an electric vehicle battery cell joint venture plant in Ohio which will be one of the world’s largest battery facilities.
The plant, to be built near the Lordstown complex, will employ more than 1,100 people, the companies said.
As part of the Lordstown sale, GM has the option to lease land near the assembly plant that it could use for the battery plant.
(Reporting by David Shepardson; Editing by Sonya Hepinstall)
– Market faces potential surplus of 1,000 jets next year
– Air Lease CEO less worried about surge in MAX deliveries
– Older aircraft won reprieve during MAX grounding
– Boeing aims to deliver record-matching 70 MAX a mth on return
HONG KONG, Nov 5 (Reuters) – Airlines struggling to cope with the grounding of the 737 MAX could face a markedly different problem when Boeing Co’s best-selling jet is cleared to re-enter service: a switch to concerns about aircraft oversupply, carriers have been warned.
The U.S. planemaker has continued to produce the jet since it was grounded in March after two fatal accidents, and is expected to speed deliveries by 40%, to 70 units a month, when its factory doors reopen, in a bid to clear the backlog.
Rob Morris, global head of consultancy at UK-based Ascend by Cirium, said the combination of any rapid rebound in deliveries, economic worries and an accumulation of market pressures dating back before the crashes could make it hard to absorb the jets.
“Next year is the challenge. When the dam breaks and the MAX starts to flow, there are going to be a lot of aircraft,” Morris told financiers at a Hong Kong briefing late on Monday.
“There could potentially be as many as 1,000 surplus aircraft next year.”
The forecast is based on both a rebound in MAX deliveries and a potential glut of second-hand airplanes flooding back onto the market after standing in for the MAX during the grounding.
The crisis has rekindled demand for older and less efficient jets, with airlines using more than 800 planes that are more than 15 years old, compared to conditions four years ago, Morris told the Airline Economics Growth Frontiers conference on Tuesday.
TWO-YEAR LOG JAM
Until now, most concern has focused on whether regulators would permit an orderly return to service by avoiding gaps in approvals by different countries.
But Morris, who has warned a long up-cycle in aviation is nearly over, said there were also risks in opening floodgates too quickly, overwhelming fragile growth in travel demand.
Still, he and other delegates at back-to-back aviation finance gatherings in Hong Kong agreed it would take Boeing 18 months or longer to deliver all the stranded aircraft.
The operation will be one of the industry’s biggest ever logistical challenges and any glitches or delays could further brake supply.
“Getting all those aircraft, that are currently parked, off the ground could take two years,” John Plueger, chief executive of Air Lease Corp, told Reuters, adding he did not see fundamental changes as a result of the MAX’s return.
“It is not as if all these MAX could be delivered over a one-, two- or three-month period … so it is not an open floodgate and 350 planes all coming onto the market tomorrow,” he said on the sidelines of last week’s Airfinance Journal Asia Pacific conference.
Boeing aims to return the 737 MAX to service in the United States by the end of 2019, after making software changes in the wake of the crashes, which killed 346 people.
Europe’s top regulator said on Monday the airliner is likely to return to service in Europe in the first quarter of 2020.
Analysts say more than 300 MAX aircraft have been produced since March, when commercial flights were banned and deliveries frozen. This could rise to 400 by the time it resumes service.
Boeing is additionally expected to deliver close to 600 jets straight from the production line next year. It has indicated it plans to deliver up to 70 jets a month, equal to a previous record. Of this, analysts say around 20 are expected to be drawn from inventory parked at its factories and the rest newly built.
(Reporting by Tim Hepher and Anshuman Daga in Hong Kong Editing by Matthew Lewis and Clarence Fernandez)
LAS VEGAS (AP) — A company backed by tech billionaire Elon Musk has been awarded a nearly $49 million contract to build a transit system using self-driving vehicles underneath the Las Vegas Convention Center.
The board of directors of the Las Vegas Convention and Visitors Authority approved the contract Wednesday with The Boring Company, the Musk-backed enterprise based in Hawthorne, California.
People would be transported underground on self-driving electric vehicles from three types of Tesla Model X chassis. The system will be capable of transporting up to 16 people at time through parallel tunnels, each running in a single direction. The twin tunnel system will run less than a mile (1.6 kilometer) long.
The system also will include a pedestrian tunnel and three underground stations accessible from convention center’s halls.
The company plans to immediately pursue permits to start construction in September. It aims to debut the system by December 2020.
“The first thing that’s important is to get it right,” Authority President and CEO Steve Hill told the Las Vegas Review-Journal . “We want to do it as quickly as possible, but we want our customers to be comfortable with it.”
Las Vegas Mayor Carolyn Goodman cast the only vote against the project. At a meeting last week, she cited concerns about hiring a company that has yet to deliver a transit system.
The authority will reimburse the company as it completes certain stages of the project, like completing excavation for the first station and digging the first 100 feet (30.5 meters) of the first tunnel. Full payment is contingent on the company demonstrating that the system can support an average of 4,400 passengers per hour.
Construction will be able to proceed without disruption to traffic or other surface activity, Hill said. The system also could be expanded, which could be part of the solution to the city’s transportation problems, he said.
March
6 (Reuters) – Amazon.com Inc will close all of its U.S. pop-up stores
and focus instead on opening more book stores, a company spokesperson
said on Wednesday.
The company’s shares closed down 1.4 percent at $1,668.95.
The news underscores how the online retailer is still working out its brick-and-mortar strategy.
Pop-up
stores for years helped Amazon showcase novel products like its
voice-controlled Echo speakers, but the company is now able to market
those products and more at its larger chain of Whole Foods stores,
acquired in 2017, and cashierless Amazon Go stores, which opened to the
public last year.
The
online retail giant will also open more “4-star stores” – stores that
sell items rated 4-stars or higher by Amazon customers, the spokesperson
added.
“After
much review, we came to the decision to discontinue our pop-up kiosk
program, and are instead expanding Amazon Books and Amazon 4-star, where
we provide a more comprehensive customer experience and broader
selection.”
Shares of bookseller Barnes & Noble Inc closed down 8.9 percent at $5.84.
(Reporting by Uday Sampath in Bengaluru; Editing by Maju Samuel)
(Reuters)
– The U.S. Federal Aviation Administration is investigating Southwest
Airlines Co for widespread failure to accurately track the combined
weight of checked bags loaded onto its jets, the Wall Street Journal
reported on Monday.
The
U.S. aviation safety agency’s year-long civil probe found systemic and
significant mistakes with employee calculations and luggage-loading
practices, resulting in potential discrepancies when pilots compute
takeoff weights, the Journal reported, citing government officials and
internal agency documents
The
FAA has not decided whether to impose fines or any other punishment,
the report cited people familiar with the investigation as saying.
The
inaccuracies ranged from a few dozen pounds to more than 1,000 pounds
(450 kg) in excess of what the paperwork indicated, sparking disputes
between the company and some agency inspectors about potential safety
consequences, the report said.
A
company spokeswoman said there was an open Letter of Investigation
(LOI), which is a common mechanism for the FAA to document and share
safety interests or concerns with an airline.
The
airline has not been issued fines and faces no enforcement action
regarding its weight and balance program, Southwest spokeswoman Brandy
King said.
“In
this case, the LOI addresses an issue that Southwest voluntarily
reported to the FAA last year and since that time, Southwest has
implemented controls to address weight and balance program concerns, and
shared those measures with the FAA,” King said.
The FAA said in a statement it initiated a probe against Southwest in 2018 regarding weight and balance performance data.
“Since
that time, the FAA has directed the development of a comprehensive
solution to the methods and processes used by Southwest Airlines to
determine this performance data,” it said in the statement. “The FAA
will not close its investigation until it is satisfied that Southwest’s
corrective actions are consistent and sustained.”
(Reporting by Rama Venkat in Bengaluru; Editing by Bernadette Baum and Peter Cooney)
