Tesla looks to build a factory in Shanghai after tariffs hike their car prices more than 20% in China. The Hustle Wed, Jul 11 Brought to you by Airtable… artful organization. It begins: Tesla buyers in China are among the first hit in the trade war Yesterday we wrote about the great US/Chinese tariff-off of […]
July 11, 2018
Tesla looks to build a factory in Shanghai after tariffs hike their car prices more than 20% in China.
It begins: Tesla buyers in China are among the first hit in the trade war
Yesterday we wrote about the great US/Chinese tariff-off of 2018 that most recently targeted $34B worth of US exports. Now, as first reported by The Wall Street Journal, we’re already seeing one of our earliest casualties: Chinese Tesla consumers.
As if Elon Musk hasn’t suffered enough production headaches lately, the new tariffs sent prices on Tesla’s Chinese website skyrocketing nearly 20%.
A tariffic time to be in the market for a Tesla
Tesla slashed prices almost 6% after the Chinese government reduced taxes on imported cars by 10% back in May, effective July 1.
But the celebration didn’t last long -- the measures imposed 6 days later raised the tariff on Tesla to 40% in total.
A basic Model S now costs roughly $128k, up from $107k last week, and the Model X SUV is up to $140k from $117k.
Why are they getting hit so hard?
Unfortunately for many carmakers, including Tesla, who manufacture exclusively in the US, passenger vehicles are on the list of the 545 US exports targeted.
And, while experts don’t expect it to affect sales immediately (people driving Teslas aren’t exactly pinching pennies), it could become an issue down the line -- mainly because Tesla is putting the costs on their customers, instead of eating it like Daimler and BMW.
China is a huge market for Tesla
With around 30 stores in China, the company sold around 17k cars and brought in $2B last year, making the country their 2nd biggest market.
Now, with their market share at risk, the company’s loose plans to someday build factories in China are suddenly a priority (yesterday, they announced their plan to officially get cookin’ in Shanghai).
Tesla said they expect to begin construction “in the near future,” after all the permits are approved, with the goal of producing 500k electronic vehicles in Shanghai annually for the next 5 years.
Great, more Tesla productivity predictions
A toast to funding rounds: Restaurant management startup raises $115m
Yesterday, TechCrunch reported that restaurant management startup Toast raised $115m at a $1.4B valuation to help restaurants streamline productivity, so servers know when to 86 the special for their 4-top (that’s some restaurant lingo for ya).
Putting some cheddar on that toast
Founded in 2011 as a point-of-sale business, the company has since expanded their services and increased their revenue by 150% in the past year.
The new funding will help Toast move further away from the POS industry and offer a whole kitchen of digital tools to help restaurants operate more efficiently in both the front and back of house.
They’re pulling a few rabbits out of their chef hats
Toast already helps restaurants kick off their loyalty programs and online ordering systems and, according to the company’s CFO Tim Barash, the company is working on a product on the labor side of the table.
If all goes well, the Toast of the future will help with hiring and reduce heavy turnover that has plagued the restaurant biz since the beginning of time.
Smucker sold off the Pillsbury Doughboy and his baked-goods buddies for just $375m
The Pillsbury Doughboy is packing his bags after parent company Smucker kicked him and his siblings -- Hungry Jack, Martha White, Jim Dandy, and White Lily -- out of the House that Jelly Built.
Private equity company Brynwood Partners will buy Pillsbury and their baked-good brethren for the bargain price of $375m as Smucker adjusts business priorities.
Baked goods just aren’t the jam anymore
Smucker bought Pillsbury in 2004 for $840m. But, due to changing customer tastes, baked goods slipped to just 5% of Smucker’s revenue -- forcing the company to sell their bakery brands for way less dough.
Now, to boost profits, the 121-year-old jelly juggernaut is turning to new categories such as coffee, snacks, and pet products.
Out with the pastries, in with the pet food
Smucker recently shelled out $1.9B for Ainsworth Pet Nutrition, following the lead of other big food brands like General Mills, which paid $8B for Blue Buffalo Pet Products.
According to their website, Smucker hopes to “bring people and pets together to share memorable meals and moments.”
Now, Smucker will leverage their premium pet brands (like Rachael Ray’s Nutrish) as they fight other food companies to carve out some kibble from the $20B pet-care market.
SpotHero outfits 500 autonomous garages to secure a spot in the self-driving future
Parking spot startup SpotHero announced they have outfitted 500 of their garages in the Chicago area for self-driving cars. And, while self-driving cars may be miles away, the company is already betting on an autonomous future.
This parking startup is in a good Spot to invest
SpotHero has grown rapidly over the past several years, as their $57.5m in funding gave the company enough cash to acquire 2 competitors, ParkPlease (2015) and Parking Panda (2017).
To hold their spot as the nation’s leading parking app, CEO Mark Lawrence has been preparing for an autonomous future since 2016.
You didn’t expect them to wait for self-driving cars to exist, did you?
But, when they are, SpotHero will be waiting with open spots. The company has already installed sensors that lets cars book and pay for themselves.
More importantly, SpotHero created a software development kit called HeroConnect that will allow Uber, Lyft, Waymo and others to integrate with their platform.
So far, Bosch and Daimler have introduced a self-driving valet system, and smaller startups have automated parking systems in development. But SpotHero, which already operates in 96 different cities, has the biggest head start.