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Tesla Motors: stocks plummet, but the innovations continue

Tesla’s products have always created buzzing excitement; so why has Tesla been plagued with financial difficulties and what can you learn from them?

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Tesla Motors: a mixed bag of news

Tesla Motors has been making a lot of headlines lately with both its achievements as well as its losses. The electric car manufacturer, which produces an AC powered sports car and luxury sedan, will roll out the world’s first electric SUV later this year. The company is named for infamous visionary physicist, Nikola Tesla, whose 1882 AC motor design directly inspired Tesla Motor’s vehicles.

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Tesla just released a video, via Twitter, of a prototype of its “snakebot autocharger” in action. This futuristic feature resembles a metal-plated robot snake that automatically senses when it’s charging point is nearby and gracefully slithers into place to begin charging the vehicle, even after you’ve wandered away from the garage.

A Tesla car recently got hacked

Around the same time, two researchers discovered how to hack Tesla’s Model S. Electric cars can’t be hot wired and stolen like regular vehicles, but their software can be hacked so that thieves could remotely start and stop the vehicle’s engine. The researchers discovered six major vulnerabilities in Tesla’s security systems.

Tesla immediately hired the researchers to help them resolve the problems, hired respected security expect Chris Evans to head the Tesla security team, and issued a downloadable software update to Model S owners to protect against hackers.

The company issues a security patch, moves on

Despite these weaknesses in security, Kevin Mahaffey of the research team that hacked the Model S, considers Tesla’s vehicle to be “the most secure car that we’ve seen.” The research team was impressed that Tesla was able to quickly and remotely send out a software update.

They say that modern smart cars need to be updated as or more often than a home PC, so being able to send out these updates over the air is a huge advantage.

They were also pleased to see that Tesla, unlike other manufacturers like Jeep, has thought ahead about the safety consequences of a potential hacking. If your Jeep gets hacked and your engine is cut off remotely while you’re driving, it’s likely they’ll be scraping you off the pavement. Tesla’s vehicles, on the other hand, if hacked, will go into neutral and the driver will still have control over the steering and brakes, allowing you to cruise to safety.

It took some time, but the company turned a profit

The sheer ingenuity of Tesla’s products has tech and automotive geeks excited, and yet Tesla Motors has been plagued with financial insecurities throughout its lifetime. The company was founded in 2003, yet didn’t turn a profit until ten years later.

In a recent announcement of its second quarter earnings for 2015, Musk admitted that they would not be able to reach their goal of disturbing 55,000 electric SUV’s this September, and would shoot for a more modest 5,000. Within minutes, Tesla’s stock dropped by eight percent.

Apparently the Model X, with its Back to the Future style fold-up doors, is perhaps the most challenging vehicle to build on the market today. The Model X shares an assembly line with the Model S at Tesla’s Fremont, California factory, and Musk thinks this might slow down their entire operation as they troubleshoot some of the finer points of building the first electric SUV.

Will they reach their profit goals this year?

Although the announcement that they’d be rolling out fewer Model X’s than expected scared some stockholders into selling, Tesla did have some good news to share, as they revealed better than expected second quarter earnings, with slightly more revenue generated and less net loss than analysts had predicted. What’s more, its new program to sell used electric cars generated an additional $20 million in profits. Industry analyst Cathie Wood says that “the fact that used Teslas were selling faster than they were coming in indicated the company might have a potential winning hand moving into the used car market.”

However, Tesla’s chief financial officer, Deepak Ahuja, said it would be too “close to call” as to whether or not they would reach their profit goals for the end of this year, and may need until the first quarter of 2016 to catch up.

Regardless, the innovations continue

Despite the company’s financial ups and downs, its CEO, Elon Musk, still has more than enough cash on hand to contribute to charitable causes he cares about such as – get this – protecting the world against a potential robot takeover. Early this year, Musk donated $10 million to the Future of Life Institute, a non-profit organization that researches “artificial intelligence safety.” The donation will be used by FLI to fund an open grants competition, and the organization is calling for proposals for new research and ideas around protecting humanity from the potential negative impacts of artificial intelligence.

In an interview, Musk explained that, when it comes to artificial intelligence, it is possible to imagine disaster situations in which “recovery of human civilization does not occur.” He argues that is time to invest in preventing such negative outcomes, rather than reacting to them after it’s too late.

Wise advice from the man behind the automatic snakebot, who will also be releasing an autopilot test program to select electric car drivers later this month. Soon Musk will be delivering cars that charge and drive themselves – but that doesn’t mean he trusts the robots not to take things too far.

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Ellen Vessels, a Staff Writer at The American Genius, is respected for their wide range of work, with a focus on generational marketing and business trends. Ellen is also a performance artist when not writing, and has a passion for sustainability, social justice, and the arts.

Business News

What you need to know about the historic TikTok deal (for now)

(BUSINESS NEWS) No one really knows what’s happening, but the TikTok deal’s impact on business, US-China relations, and the open internet could be huge.

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Male black hands holding app opening TikTok app.

So, maybe you’ve heard that Oracle and Walmart are buying TikTok for national security!

Um, not exactly.

Also, Trump banned TikTok!

Sort of? Maybe?

But then he said he approved the Oracle-Walmart-TikTok deal!

We guess?

The terms of the proposal seem to shift daily, if not hourly. The sheer number of contradictory statements from every player suggests no one really knows what’s going on.

Just one example: Trump said the deal included a $5 billion donation to a fund for education for American youth. TikTok parent ByteDance, said, “Say what now?”

Here’s what we think we know (as of this writing):

Oracle and Walmart would get a combined 20 percent stake in a new U.S.-based company called TikTok Global. Combine that with current US investors in China’s ByteDance, TikTok’s parent, that would give American interests 53 percent. European and other investors would have 11 percent. China would retain 36 percent. (On Saturday Trump said China would have no interests at all. But that does not jibe with the reporting on the deal.)

Oracle would host all user data on its cloud, where it is promising “security will be 100 percent” to keep data safe from China’s prying eyes. But reporting has differed on whether Oracle will get full access to TikTok’s code and AI algorithms. Without full control, skeptics say, Oracle could be little more than a hosting service, and potential security issues would remain unaddressed.

Walmart says they’re excited about their “potential investment and commercial agreements,” suggesting they may be exploring e-commerce opportunities in the app.

The US Committee on Foreign Investment in the United States, which is overseen by Treasury Secretary Steven Mnuchin, still has to approve any deal.

As for the TikTok “ban” – which isn’t really a ban because current users can keep it – the Commerce Department postponed the deadline for kicking TikTok off U.S. app stores to September 27, to give time for the deal to be hammered out. Never mind that it’s still not clear whether the U.S. government has authority to do that. Unsurprisingly, ByteDance says it doesn’t in a lawsuit filed September 18.

Whatever happens with the whiplash of the deal’s particulars, there are bigger issues in play.

According to business news site Quartz, moving data storage to Oracle mirrors what companies like Apple have done in China: Appease the Chinese government by allowing all data hosting to be inside China. A similar move could “mark the US, too, shifting from a more laissez-faire approach to user data, to a more sovereign one,” says China tech reporter Jane Li.

More obvious: Corporate sales and mergers are now part of the parrying between the U.S. and China, which adds a whole new playing field for negotiations among businesses.

In the meantime, TikTokkers keep TikTokking. White suburban moms continue to lip sync to rap songs in their kitchens. Gen Z continues to make fun of the president – and pretty much everything else.

And downloads of the app have skyrocketed.

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Business News

Hobby Lobby increases minimum wage, but how much is just to save face?

(BUSINESS NEWS) Are their efforts to raise their minimum wage to $17/hour sincere, or more about saving face after bungling pandemic concerns?

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Hobby Lobby storefront

The arts-and-crafts chain Hobby Lobby announced this week that they will be raising their minimum full-time wage to $17/hour starting October 1st. This decision makes them the latest big retailer to raise wages during the pandemic (Target raised their minimum wage to $15/hour about three months ago, and Walmart and Amazon have temporarily raised wages). The current minimum wage for Hobby Lobby employees is $15/hour, which was implemented in 2014.

While a $17 minimum wage is a big statement for the company (even a $15 minimum wage cannot be agreed upon on the federal level) – and it is no doubt a coveted wage for the majority of the working class – it’s difficult to not see this move as an attempt to regain public support of the company.

When the pandemic first began, Hobby Lobby – with more than 900 stores and 43,000 employees nationwide – refused to close their stores despite being deemed a nonessential business (subsequently, a Dallas judge accused the company of endangering public health).

In April, Hobby Lobby furloughed almost all store employees and the majority of corporate and distribution employees without notice. They also ended emergency leave pay and suspended the use of company-provided paid time off benefits for employees during the furloughs – a decision that was widely criticized by the public, although the company claims the reason for this was so that employees would be able to take full advantage of government handouts during their furlough.

However, the furloughs are not Hobby Lobby’s first moment under fire. The Oklahoma-based Christian company won a 2014 Supreme Court case – the same year they initially raised their minimum wage – that granted them the right to deny their female employees insurance coverage for contraceptives.

Also, Hobby Lobby settled a federal complaint in 2017 that accused them of purchasing upwards of 5,000 looted ancient Iraqi artifacts, smuggled through the United Arab Emirates and Israel – which is simultaneously strange, exploitative, and highly controversial.

Why does this all matter? While raising their minimum wage to $17 should be regarded as a step in the right direction regarding the overall treatment of employees (and, hopefully, $17 becomes the new standard), Hobby Lobby is not without reason to seek favorable public opinion, especially during a pandemic. Yes, we should be quick to condone the action of increasing minimum wage, but perhaps be a little skeptical when deeming a company “good” or “bad”.

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Business News

RIP office culture: How work from home is destroying the economy

(BUSINESS NEWS) It’s not just your empty office left behind: Work from home is drastically changing cities’ economies in more ways than you think.

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An empty meeting room, unfilled by work from home employees.

It’s been almost six months since the U.S. went into lockdown due to COVID-19 and the CDC’s subsequent safety guidelines were issued – it’s safe to say that it is not business as usual. Everyone from restaurant waitstaff to start-up executives have been affected by the shift to work-from-home. Even as restrictions slowly begin to lift, it seems as though the office workspace – regarded as the vital venue for the U.S. economy – will never truly be the same.

Though economists have been focusing largely on small businesses and start-ups, we are only just beginning to understand the impact that not going back into the white-collar office will have on the economy.

The industries that support white-collar office culture in major cities have become increasingly emaciated. The coffee shops, food trucks, and food delivery companies that catered to the white-collar workforce before, during, and after their workday, are no longer in high demand (Starbucks reported a loss of $2 billion this year, which they attribute to Zoomification). Airlines have also been affected as business travel typically accounts for 60%-70% of all air travel.

Also included are high-end hotels, which accommodate the traveling business class. Pharmacies, florists, and gyms located in business districts have become ghost towns. Office supplies companies, such as Xerox, have suffered. Workwear brands such as J. Crew and Brooks Brothers have filed for bankruptcy, as there is no longer a need to dress for the office.

In Manhattan – arguably the country’s most notorious white-collar business mecca – at least 1,200 restaurants have been permanently lost. It is also is predicted that the one-third of all small businesses will close.

Additionally, the borough is facing twice as many apartment vacancies as this time last year, due to the flight of workers no longer tied to midtown offices. Workers have realized their freedom to seek more affordable and spacious residence outside the city. As companies decentralize from cities and rent prices drop, it isn’t all bad news. There is promise that particular urban white-collar neighborhoods will start to become accessible to the working class once again.

Some companies, like Pinterest and REI, are reporting that their shift to work from home is in fact permanent. The long-term effects of deserted office buildings are yet to make themselves evident. What we do know is that the decline of the white-collar office will force us to reimagine the great American cities – with so much lost due to the coronavirus, what can now be gained?

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