LeEco to drop $3 billion on self-driving car plant

LeEco announced last week a $3 billion industrial park that it plans to build in Huzhou City, Zhejiang to rival Tesla’s Gigafactory.

The complex, which will be built in two parts, will manufacture the LeSee electric car, car batteries and electric motors, and serve as an R&D center for self-driving and other emerging automotive tech.

The first phase of construction is set to begin late this year or early next year. It will cover an area of 4,300 acres and should be able to produce 200,000 cars annually. LeEco didn’t give a date when the second phase would start, but said it should reach 400,000 cars when finished.

Its an ambitious project, especially considering LeEco apparently doesn’t have a license to produce electric cars in China. The company has applied for a license, but so far has not received confirmation.

LeEco is undeterred, saying that the license isn’t a major deal.

It was looking for a partner to build the LeSee, possibly Beijing Auto or Guangzhou Auto, but decided to build its own industrial park instead. The factory could save LeEco money on production, though investors worry with the $2 billion purchase of Vizio, the Beijing-based firm is spreading itself too thin.

Where are all of LeEco’s investments?

Some also wonder where LeEco is getting the funds to pay for all of these huge investments.The Information and Bloomberg both reported some fishy borrowing and spending by CEO Jia Yueting, hinting at a lack of corporate oversight on leader decisions and finances.

LeEco has a large stake in Faraday Future, the autonomous car company that has shown up to CES 2015 and 2016 and is working with Aston Martin to build an electric car, so if it doesn’t get a license to build in China, it still has some connection to the automotive market.

People have questioned LeEco before for its extremely aggressive push into new markets. The Le 1 and Le Max both were underpriced and high performance smartphones, but both sold well and the company reported a small profit in the months following.

A car costs quite a bit more than a smartphone to manufacture however, and this will be a real test to see if LeEco can play by the Chinese regulators rules, keep its finances in check, and sell a fully functional, high performance electric car.

Hanergy to build solar-powered electric cars

It used to be that only car companies could build cars. But this is the twenty-first century, when seemingly anyone can build a car or four, including a Chinese solar power company. Hanergy Holding Group, which manufactures thin-film solar panels, has created a Solar Vehicle Business Division that debuted four solar-powered prototypes in Beijing.

In a world where anyone can come up with an idea for a vehicle, few make it all the way to production. Hanergy announced its plans to build solar-powered vehicles last year, but it failed to produce prototypes on schedule, leading industry analysts to doubt its capabilities.

But this summer, Hanergy showcased four running and driving prototypes called the Hanergy Solar O, L, A and R (check that acronym!), each designed for a different use case. All the vehicles are lightweight and covered as much as practical in flexible thin-film solar cells. According to a press release, the cells will generate 8 to 10 kWh of energy with 5 to 6 hours of sunlight, which translates to a range of 80 km (50 miles). That range is in the ballpark with several EVs available from major manufacturers, like the Fiat 500e and VW e-Golf.

That’s going to take some serious sunlight conversion, and Hanergy’s current cells have a conversion rate of 31.6 percent, the highest rate of any cells available today. Hanergy expects the rate of its cells to go up to 42 percent in the next decade, which would be enough to power a car entirely with sunlight. In the meantime, you can plug a Hanergy car in and charge the lithium-ion batteries like any other EV for an expected total range, solar and plug combined, of more than 200 miles.

Hanergy isn’t the only company working to integrate electric vehicles with zero-emissions solar charging. You may have heard of Tesla and SolarCity. If you’ve been following automotive news for a while, you may remember the Fisker Karma, which at the 2009 Detroit auto show had a prototype vehicle with solar cells on the roof (that company went bankrupt in 2013 and is being rebooted as Karma Automotive). And in 2014, the Toyota Prius was available with solar panels on the moon roof that powered a remote air conditioning system to cool the car before you got into it.

Australian electricity company will give you Tesla charging for $1 a day

Australian energy company, AGL, will provide customers who own electric vehicles, such as a Tesla, all-you-can-consume electricity for A$1 per day.

The company's CEO Andy Vesey announced the new initiative at the Australia Energy Week Conference in Melbourne on Tuesday, the Australian Financial Review reported. He said it will cost a customer A$365 a year to juice up their electric vehicle to their heart's content, while it is at home. 

It can be used for a range of electric cars including Tesla, the BMW i3, the Toyota Prius and the Nissan Leaf. The company would supply power to a customer's car charger or potentially provide them with a charger if they don't have one. 

"For a dollar a day if you have an electric vehicle and you have a AGL smart meter and a charger you can get energy for that car for $1 a day, as much as you like," Vesey said at the conference.

On Twitter, he confirmed the news with a note the deal will be available from November.

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$1 a day (fully carbon offset) to charge your #EV. AGL to launch Nov 2016. $365 pa max for all your EV trips #AEW16

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To keep with the green theme, AGL will also carbon offset the offer, according to Financial Review, with the company investing in green initiatives to counter the carbon dioxide emissions. It is a clear move to stay relevant in a world that is slowly moving towards greener vehicles and renewable energy sources. 

With the cost of charging an electric car sitting around A$4.50 per 100 kilometres in Australia, that's a pretty decent saving to put away for a rainy day. Or a cruise up the coast

Ford paid $200,000 for a Tesla Model X — $55,000 more than the normal price

Ford Motor Co. paid $199,950 — $55,000 more than the sticker price — to buy one of the first sport utility vehicles made by Tesla Motors Inc. so it could test and examine the electric SUV.

Ford bought the 64th Model X — a white Founders Series version — in March 2016. Spied recently in the Detroit area with Michigan manufacturers’ plates, it originally belonged to a California coin dealer who bought it as part of Tesla’s customer-referral promotion.

Automakers often buy cars made by competitors for road testing and for “tear-downs” to reveal components and materials and how they’re put together. But it’s unusual to pay such a high price — almost $212,000 after Michigan sales tax and title — for such an early model.

“Wow, I hope that investment pays off in some good intelligence,” Michelle Krebs, senior analyst for researcher Autotrader.com, said of the premium Ford paid. “If you’re going to be one of the early buyers, you’re probably going to pay well over list. But that’s significant.”

Krebs suspects other major automakers, such as General Motors Co. and Toyota Motor Corp., are also among early buyers of the Model X. Automakers are looking for ways to make highly profitable SUVs more fuel efficient as they race to meet a federal mandate to average 54.5 miles per gallon by 2025. Ford is investing $4.5 billion in electrified vehicles and will add 13 electric cars and hybrids by 2020.

Future SUVs

“We’re going to definitely see more electrification and light-weighting,” Krebs said. “Those are the things I suspect Ford would be taking special note of as they develop their sport utilities of the future.”

Krebs said she hopes Chief Executive Officer Mark Fields and Executive Chairman Bill Ford —as well as the automaker’s top engineers and designers — get some seat time in the Model X.

“Everybody should be exposed to one of your hottest competitors,” Krebs said.

One Ford executive spotted driving the company’s white Model X was David Woodhouse, chief designer of the automaker’s Lincoln luxury line, according to a person who saw him. Woodhouse oversaw the creation of the Lincoln Navigator concept SUV that debuted at the New York Auto Show last month. Like the Model X, the Navigator concept featured gull-wing doors, though Ford said that feature won’t be on the production version of the SUV. Ford declined to confirm who is driving the car.

Tesla’s first Model Xs are limited-edition Founders Series —fewer than 100 of them were made — that typically go to board members and close friends of the company like Google co-founder Sergey Brin. Those are followed by the Signature Series models, which require a $40,000 deposit from customers and start at $132,000. According to vehicle registration documents obtained by Bloomberg, the window-sticker price on the all-wheel-drive Model X P90D that Ford purchased is $144,950, including the $10,000 Ludicrous Speed Upgrade that boasts a 0-to-60 miles per hour time of 3.2 seconds.

Original owner

The original owner of the Model X that was ultimately purchased by Ford was Wayne Skiles, 71, who owns and operates the Carousel Coin & Jewelry Exchange in San Bernardino, California. Skiles owns a Model S sedan and participated in Tesla’s Model S referral program. Customers who referred at least 10 friends to purchase a Model S were able to buy a Model X Founders Series for a base price of $116,700.

“I sold 11 Model Ss. So I got a Founders Model X and immediately flipped it for a profit,” said Skiles in a phone interview. “The car never came to California. I flew to Chicago, took physical delivery of the Model X and immediately drove it to a dealer in Chicago and sold it.”

Ford bought the vehicle from Corporate Auto of Auburn Hills, Michigan, according to the documents.

“It is a common industry practice among many automakers to buy production vehicles for testing as soon as they are released,” said Ford in a statement. “Sometimes, this means automakers pay more than sticker price to acquire them as quickly as possible.”

Quality concerns

Tesla officially launched the Model X at a splashy event in late September, years after the vehicle’s early 2012 unveiling. The company announced that it delivered 2,400 of the SUVs in the first quarter as it continues to ramp up production. But early models are not without flaws: several customers have reported issues with sensors on the “falcon-wing” doors that open vertically. Consumer Reports on Tuesday published a report about quality problems on early models. Tesla shares slipped 2.6 percent on Tuesday before rebounding 2.3 percent Wednesday to $253.09 at 1:48 p.m. New York time.

“We are committed to making the world’s most reliable cars,” said Tesla in a statement Tuesday. “While we have seen some issues with early Model X builds, the issues are not widespread, and we are working closely with each owner to respond quickly and proactively to address any problems. We will continue to do so until each customer is fully satisfied. This commitment is one of the reasons why 98 percent of our customers say they will buy another Tesla as their next car.”

Earlier this month, Tesla issued a recall on 2,700 Model Xs made before March 26 to repair the third-row seats after strength tests done by the automaker found a potential defect. Tesla has advised customers not to let anyone sit in those seats while the car is in use.

Musk has said that the Model X’s unique features were difficult to engineer and relied heavily on parts suppliers. Tesla said this month that Model X deliveries missed first-quarter expectations because of parts shortages stemming from “Tesla’s hubris in adding far too much new technology” to the Model X.

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This article originally published at Bloomberg