Morning Brew - ☕️ Don’t talk to her

Why Tesla’s in a world of pain...
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April 03, 2024 View Online | Sign Up | Shop

Morning Brew

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Good morning. We are so excited to announce that two of our social media stars, Macy Gilliam and Dan Toomey, have been nominated for Webby Awards (the “best of the internet” as voted by fans). Dan was nominated for his genius coverage of the banking crisis last March, and Macy was selected for her wholesome series profiling NYC’s under-the-radar businesses, like this handmade stamp shop.

Thankfully, a civil war has been avoided because they were nominated in different categories. Vote here for Macy and vote here for Dan.

—Cassandra Cassidy, Sam Klebanov, Matty Merritt, Adam Epstein, Neal Freyman

MARKETS

Nasdaq

16,240.45

S&P

5,205.81

Dow

39,170.24

10-Year

4.365%

Bitcoin

$66,081.12

Tesla

$166.63

*Stock data as of market close, cryptocurrency data as of 9:00am ET. Here's what these numbers mean.

  • Markets: Stocks fell yesterday and hit every branch on the way down, sending all three major indexes down with them as investors were suddenly worried that the Fed won’t cut interest rates in June. Meanwhile, Tesla’s stock dropped on reports that it badly missed sales expectations (much more on that below).
 

AUTO

Tesla is straight up not having a good time

Elon Musk Getty Images

Elon Musk’s carmaker is facing so many problems that its discombobulated Cybertruck rollout is now looking like the least of its worries.

Tesla reported its first year over year sales decline since 2020 yesterday, signaling more concern for an EV industry that’s already struggling to find its footing. The company delivered 386,810 cars in Q1 of 2024, down 8.5% from a year earlier.

Wall Street analysts predicted that deliveries would be down, since the company warned of “notably lower” growth in January due to the process of building out a new model and high interest rates making it harder for people to buy new cars. But Tesla performed even worse than expectations, falling short by ~70,000 vehicles, according to some forecasts.

Why Tesla’s in a world of pain

The automaker cited production setbacks as part of the reason for the letdown. Those included an alleged arson attack on an assembly line in Germany, a parts shortage due to attacks on ships in the Red Sea, and the company’s transition over to a new Model 3 sedan.

But…it’s not just a supply issue. Consumers aren’t as eager to drive an electric vehicle these days, and Tesla isn’t doing much to help:

  • Like the Pittsburgh Steelers, its current lineup is aging. Tesla models are old by car standards, and the anticipated new budget model likely won’t be available until late 2025.
  • Having a walking controversy for a CEO isn’t great for business. A recent survey showed that people are less likely to buy a Tesla because of Musk’s reputation.

And then there’s BYD. The Chinese auto company, which briefly passed Tesla as the world’s top EV seller in Q4 of 2023, is stealing some of Tesla’s market share with newer, more affordable models.

Zoom out: Tesla isn’t the only carmaker feeling the sting. EV competitor Rivian also missed production estimates in Q1, while Ford and General Motors are reworking their EV plans amid weaker-than-expected demand.—CC

   

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WORLD

Tour de headlines

Building partially collapsed in Taiwan VCG/VCG via Getty Images

Huge earthquake rocks Taiwan. A 7.4 magnitude earthquake, Taiwan’s strongest in 25 years, struck the island early Wednesday, damaging dozens of buildings, roads, and bridges and killing at least seven people. Taiwan Semiconductor Manufacturing, the world’s top producer of advanced chips, evacuated some of its plants, but employees later returned to work. It was the most powerful earthquake to hit Taiwan since 1999, when a 7.7-magnitude quake killed more than 2,000 people.

President Biden condemned Israel for its strike that killed seven aid workers in Gaza. Biden said he was “outraged and heartbroken by the deaths,” which Israeli Prime Minister Benjamin Netanyahu admitted was a “tragic case of our forces unintentionally hitting innocent people.” The aid workers were staff members of the World Central Kitchen, a nonprofit humanitarian group founded by Spanish American celebrity chef José Andrés. According to WCK, the workers were hit despite coordinating their movements with the Israeli military. One of those killed was a dual US-Canadian citizen. As a result of the airstrike, the group said it halted operations in the region.

Apple is making the Vision Pro less socially isolating. The tech giant announced it’s launching “spatial Personas,” which allow users to see and interact with the ghostlike, disembodied virtual heads of up to four other Pro-using friends across several apps. The mixed-reality device had been criticized for leaving some users feeling cut off from the rest of the world, but the new feature is meant to improve collaboration. While Apple’s still working to hone the 3D technology, you’re now free to virtually work or just chill with your buds.

TECH

Jon Stewart: Apple told me not to interview Lina Khan

Jon Stewart Zach Gibson/Getty Images

Jon Stewart’s former corporate overlord Apple didn’t want him inviting Federal Trade Commission Chair Lina Khan on his podcast, the comedian claimed. “They literally said, ‘Please don’t talk to her,’” Stewart told Khan as he picked her brain about the concentration of corporate power in the US on The Daily Show this week.

Stewart recently returned to the show that made him the king of late-night news commentary after a two-year stint hosting The Problem with Jon Stewart on Apple TV+. He broke with Apple suddenly last fall over creative disagreements, as Apple was concerned about his plans to cover touchy topics like China and AI, per the New York Times.

Apple of discord

The tech giant probably had its reasons for not being interested in platforming the nation’s top antitrust enforcer.

  • Khan is famously skeptical of Big Tech’s bigness, and her agency recently sued Amazon over alleged anti-competitive practices.
  • After Stewart returned to Comedy Central, Apple was sued by the other federal antitrust cop, the Department of Justice, which accused it of being a smartphone monopolist.

Case in point: Khan told Stewart that her being unwelcome on his podcast only underscores the dangers of corporations having outsized economic power.—SK

   

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WORK

McKinsey will pay staff to scram

Jimmy Fallon The Tonight Show Starring Jimmy Fallon/NBC via Giphy

Don’t call it a buyout—call it a coordinated effort to curate a headcount reduction. McKinsey, the consulting company that legally has to be on your resume if you have an MBA, is offering UK employees nine months of pay if they agree to spend that time looking for a new workplace.

The offer targets staff who manage teams of consultants and associate partners, and includes access to the firm’s career coaching services. It’s also up for grabs in the US offices, but it’s not clear how many employees can accept it, or if the pay plan is the same, according to British newspaper the Times.

  • A spokesperson said, “A core part of our mission is helping people learn and grow into leaders, whether they stay at McKinsey or continue their careers elsewhere.”
  • Last year, the firm pushed back start dates for recent hires.

Consult with consultants: McKinsey and other consulting firms have been desperate to trim staff after pandemic-era hiring booms. Last year, the company said it would cut 1,400 jobs after its roster ballooned to over 45,000, compared with 28,000 in 2018.—MM

   

GRAB BAG

Key performance indicators

Caitlin Clark celebrating victory over LSU Greg Fiume/NCAA Photos via Getty Images

Stat: Whenever Caitlin Clark steps on a basketball court, you expect a record to be broken. It happened again Monday night, when Iowa’s dramatic win over LSU in the Elite Eight smashed the record for the most-viewed women’s college basketball game ever, pulling in an average audience of 12.3 million. That’s a nearly 25% increase from the previous high of 9.9 million viewers, set last year between…also Iowa and LSU, in the championship. For context, more people watched this game than every MLB, NHL, MLS, and NBA game (except one) last season, per FOS.

Quote: “This assault on human creativity must be stopped.”

If you gave her some time, Billie Eilish could probably learn to make an AI model...but an AI would never in a million years be able to write “What Was I Made For?” That’s the message at the heart of a new anti-AI open letter signed by some of the biggest pop stars in the world, including Eilish, Katy Perry, Nicki Minaj, and Kacey Musgraves. The letter argues that AI, when used irresponsibly, poses a threat to musicians’ livelihoods. It also demands that tech companies pledge not to make AI tools that “undermine or replace the human artistry of songwriters.”

Read: Neckties are making a comeback. (WSJ)

NEWS

What else is brewing

  • GE completed its three-way split, breaking its aerospace, energy, and healthcare businesses into three separate companies.
  • Amazon is giving up on its cashierless “Just Walk Out” technology at its grocery stores.
  • Germany is redesigning its Adidas national soccer team jerseys after claims that the number “44” resembled Nazi imagery.
  • President Biden and China’s Xi Jinping reportedly had a phone chat about AI, Russia, fentanyl, and more in their first interaction since November.
  • House Republicans introduced a bill to rename Washington, DC’s Dulles airport after Donald Trump.
  • Joe Flaherty, the comedian and actor best known for his roles in SCTV, Freaks and Geeks, and Happy Gilmore, died at 82.

RECS

Wednesday to-do list

Fly: Easily compare pros and cons of every airline, airport, and airplane model with this tool.

Supplement: These are the benefits of taking a daily multivitamin, according to the data.

Look up: Enter your address to see what the April 8 solar eclipse will look like near you.

Watch: The trailer for Netflix’s dark comedy-thriller Bodkin, the first scripted drama from the Obamas’ production company.

Stay groovy: Buy the Morning Brew tie-dye crewneck to let everyone know you’re cool and informed. And you know what’s even more chill than that? A 30% discount.

The pressure is on: …and despite employer efforts, workers are feeling the pinch. Find (and address) the root of employee mental health challenges with Calm’s 2024 Voice of the Workplace Report.*

*A message from our sponsor.

GAMES

The puzzle section

Word Search: How well do you know iconic houses featured in movies? Find out in today’s Word Search.

Twin cities

Below are five pairs of global cities. What do the sets have in common?

  1. Madrid, Spain / Wellington, New Zealand
  2. Buenos Aires, Argentina / Shanghai, China
  3. Hanoi, Vietnam / La Paz, Bolivia
  4. Johannesburg, South Africa / Honolulu, Hawaii
  5. Hamilton, Bermuda / Perth, Australia

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ANSWER

They are “antipodes”—spots on Earth that are diametrically opposite one another. Not all of the above pairs are exact antipodes, but they’re close.

Word of the Day

Today’s Word of the Day is: discombobulated, meaning “confused or disconcerted.” Thanks to Clare from Milwaukee, WI, and hundreds of others for calmly waiting for us to use your suggestion. Submit another Word of the Day here.

✳︎ A Note From Eli Electric Vehicles

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