Hello and welcome back to The Station, a newsletter dedicated to all the present and future ways in which people and packages move from Point A to Point B.
For all of my American readers, I hope you are happy and full for the Thanksgiving holiday in these weirdest years. My hope for all Station readers, regardless of where they reside, is a safe and healthy rest of the year (and beyond!). While I took a break last week, the news wheel kept turning. A few elements caught my attention last week, most notably an EY study that looked at how views on public transportation, mobility as a service, and car ownership change due to COVID-19. Let's start reading!
Write to me anytime at [email protected] to share thoughts, criticisms, offer opinions or suggestions. You can also send me a direct message on Twitter - @kirstenkorosec.
Micromobbin '
Lime is adding another 1,000 scooters to San Francisco, an action it is able to take because the company also holds the Jump permit in the city. For those who may have forgotten, Lime now owns Jump through a complex deal with Uber.
The company also released data on San Francisco scooters showing how the start and end of the trip moved out of the downtown core and into neighborhoods like Mission, Castro and Hayes Valley. Lime said this evolving passenger pattern is consistent with his findings across the country, with more trips shifting to residential neighborhoods since the COVID-19 pandemic hit the world.
In other news ...CAKE, the Swedish manufacturer of light electric motorcycles, and European battery supplier Northvolt have collaborated to develop new battery cells for CAKE's range of electric motorcycles. Research, development and testing will take place in 2021 with the product slated for 2022 models.
Deal of the week
Another day, another SPAC. Anyone else looking forward to a good old S-1 filing cabinet?
Metromilla, The pay-per-mile auto insurer, is credited with disrupting some of the inefficiencies of the auto insurance business model, particularly the way consumers are charged. Instead of a standard flat rate, the company charges customers based on their mileage, which it can measure via a device connected to the vehicle.
It looks like the kind of business model that could see an increase in new customers during times of COVID pandemics. And it finally happened. However, during the gap between existing customers reducing driving times and new drivers signing up for Metromile, the company was forced to lay off about a third of its workforce.
The company has since recovered and is now embarking on the SPAC path towards public markets. Metromile plans to merge with special purpose acquisition company INSU Acquisition Corp. II, with an equity valuation of $ 1.3 billion. The company raised $ 160 million in private public equity investments, or PIPEs, in an investment round led by Chamath Palihapitiya-based Social Capital firm.
Metromile plans to use those proceeds to reduce existing debt and accelerate growth, specifically to hire employees to support its consumer and corporate insurance businesses, and grow beyond its eight-state geographic footprint to reach its goal of 21 states by the end of next year and nationwide coverage by the end of 2022.
For details on the SPAC Metromile go to my story. For a deeper dive into the insurance technology industry, check out Alex Wilhelm's article.
Another giant deal
Manbang - described as the Chinese Uber for trucks - was formed in 2017 from a merger between rivals Yunmanman and Huochebang. The company's app matches truckers and merchants who transport goods and provides financial services to truckers.
Apparently, investors can't get enough of this type of freight app business. Manbang is the latest example with a $ 1.7 billion gain from Softbank Vision Fund, Sequoia Capital China, Permira and Fidelity, a consortium that co-led the round. Other participants were Hillhouse Capital, GGV Capital, Lightspeed China Partners, Tencent, Jack Ma's YF Capital and others.
It's only been two years since the company raised $ 1.9 billion. Manbang said it achieved profitability this year. Its valuation reportedly reached $ 10 billion in 2018.
It's raining dollars!
For Tesla, this is.
I'm sure you all know it, but in case you missed it, Tesla's market cap surpassed $ 500 billion last week. As of today (Monday), it stands at $ 547 billion, a more than fivefold increase since the beginning of the year.
The price is likely to rise due to its imminent inclusion in the S&P 500 index. When Tesla joins the S&P 500 on December 21, it will be among the most valuable companies in the benchmark. Its weighting will be so influential that the S&P DJI is considering whether to add the stock to the free-float-adjusted market cap weight all at once or in two tranches.
The addition of Tesla to the S&P 500 is not just a symbolic nod. Joining the S&P 500 has real financial benefits, as investors who have funds tracked by an index will be forced to buy shares. With stock prices already exploding, this means investors will have to sell more stock to make room for Tesla.
The rise of the car
It's approaching December, which means I've been - and will continue to be - inundated with surveys, studies and year-end forecasts for 2021.
A study by EY, which looked at data from nine countries, suggests that mobility as a service (MaaS) is losing momentum for cars, trucks and SUVs.
And millennials are leading the trend. The 2020 EY Mobility Consumer Index, which surveyed over 3,300 consumers in nine countries, found that 31% of people without a car plan to buy one in the next six months, and 45% of those will be millennials. The study also found that only 6% of non-surveyed car owners are looking to purchase a fully electric vehicle.
According to EY, more than three-quarters (78%) of respondents said they will be more likely to use their car to travel in a post-pandemic world with millennials earning more than half (52%).
This is not just a US phenomenon. Respondents from Italy (47%) and Germany (46%) said they are more likely to buy a new car. Respondents from China were more likely to increase their car usage (90% of respondents), closely followed by India (85%) and Germany (81%).
Meanwhile, the use of public transport is expected to decrease by around 30%.
John Simlett, EY Global Future of Mobility Leader, raises several questions in the study.
Readers: what are your answers? Send them my way."With more people buying cars and car usage is expected to increase, this leaves policy makers with some very difficult questions to answer: How to accommodate all of these cars on our roads to aim for a more diverse mobility mix? Will this trend affect investment in public transport? Quite simply, is this sustainable and, if not, what needs to be done and by whom? "
Remarkable readings and other curiosities
And finally, the news buffet you've been waiting for.
Ford The fully electric Mustang Mach-E has an estimated EPA range of between 211 miles and 300 miles, depending on the model. While the Mach-E matched Ford's range target, it falls well short of that found in competing vehicles.
Gatik, the self-driving vehicle startup focused on the "middle mile," is expanding into Canada through a partnership with retail giant Loblaw. The company, which also announced $ 25 million in new funding, is already using its self-driving vans to deliver online grocery orders to customers for Walmart.
Gatik is deploying five autonomous vans in Toronto to deliver goods for Loblaw starting January 2021. The fleet will be used seven days a week on five routes along public roads. All vehicles will have a safety driver as a co-driver. This deployment, which follows a 10-month pilot project in the Toronto area, marks the first autonomous delivery fleet in Canada.
General Motors has shifted stance in a battle to determine whether states - and California in particular - can establish tailpipe emissions regulations and other climate change mitigation regulations that are stricter than the federal government. The automaker has said it will no longer support the Trump administration's cause to stop California from setting its own rules.
Mobility can, the Toyota-backed autonomous shuttle startup, has a new partnership with the on-demand shuttle platform Via. (I missed this article in the last newsletter). The goal is for companies to combine their expertise to expand services in new cities in 2021. May Mobility will use Via's fleet platform for booking, routing, assigning and identifying passengers and vehicles. customer experience and fleet management of its autonomous vehicles.
Ola, Uber and other ride-hailing companies in India will be able to charge a fee of up to 20% on ride fares. The new rules are a setback for SoftBank-backed companies, which are already struggling to improve their finances in the key overseas market.
The guidelines, which for the first time bring together the app-based ride-hailing companies of the modern age into a regulatory framework in the country, also put a cap on the so-called price increase, the Uber and Ola fare they charge during hours whose services see peak demands, reports ProWellTech's Manish Singh.
