The Station - A gift for readers, Uber's changing business and Nikola seeks investor confidence

Saturday, October 03, 2020 • By Kirsten Korosec

Hello and welcome back to The Station, a newsletter dedicated to all the present and future ways people and packages move from Point A to Point B.

We’re days away from a virtual event that I helped organize: TC Sessions: Mobility 2020, which will be held virtually October 6 and October 7. The event has an expo area to check out startups as well as networking sessions, a pitch off with early-stage startups and interviews with folks like JB Straubel of Redwood Materials (and formerly Tesla), Celina Mikolajczak, the VP of battery technology for Panasonic Energy of North America, Uber’s director of policy, cities & transportation Shin-pei Tsay, Argo AI founder and CEO Bryan Salesky, Ike Robotics co-founder and chief engineer Nancy Sun, Cruise’s director of global government affairs Prashanthi Raman and Nuro’s chief legal and policy director David Estrada. Oh yes, and early stage investors: Trucks VC’s Reilly Brennan, Amy Gu of Hemi Ventures and Olaf Sakkers of Maniv Mobility. Plus lots more. Check out the agenda.

Today, I’m here with gifts for you, dear reader. You’ll find promo codes and two links below, one of which will get you into the expo portion of the event for free.

General admission: includes everything – main stage interviews, breakout sessions, the Q&A sessions with some of our speakers, pitch night, the expo and a one-year subscription to ExtraCrunch. Videos of all these interviews will live behind the Extra Crunch paywall, which you’ll be able to access since you’ll have a subscription.

50% off General Admission (includes main stage) – Promo Code STATION50

https://events.bizzabo.com/tcsessionsmobility2020?promo=station50

Expo admission: includes access to the expo, where you can check out the virtual booths of mobility startups, and to the “breakout sessions.” This does NOT give you access to the main stage interviews or the Extra Crunch subscription.

Free Expo Pass – Promo Code STATIONEXPO

https://events.bizzabo.com/tcsessionsmobility2020?promo=stationexpo

Alrighty then, let’s dive in.

Email me anytime at kirsten.korosec@techcrunch.com to share thoughts, criticisms, offer up opinions or tips. You can also send a direct message to me at Twitter — @kirstenkorosec.

Image Credits: franckreporter / Getty Images

Micromobbin'

Shared micromobility startups often rely on gig economy workers to support their businesses. Not every shared micromobility startups takes this route; Revel and Ford-owned Spin are two examples of companies that use full-time employees.

You might recall that Spin employees in San Francisco unionized late last year. Now, the group of 40 workers have successfully ratified their first union contract, TechCrunch’s Megan Rose Dickey reported.

The three-year deal ensures Spin workers will get annual pay raises of more than 3% each year, six paid holidays (compared to zero holidays), vacation days based on years of employment (compared to no vacation days), five sick days a year, a $1,200 per employee ratification bonus, benefits accrual for part-time workers and other benefits.

Meanwhile, a journalist over at One Zero dug into the economics of a service that scooter company Bird announced in late 2018 called Bird Platform.

Bird said, at the time of the rollout (which we covered), that the company would provide independent operators with scooters, which they are given free rein to brand as they please, as well as access to the company’s marketplace of chargers and mechanics, in exchange for 20% of the cost of each ride. This franchise program was aimed at entrepreneurs such as local bike shops. The report from One Zero shows the program is now offering financing to people who can’t afford to buy the scooters.

I’ve place a link to the lengthy story here. The biggest issue comes down to the fine print. Doesn’t it always? These contracts contain language that puts people who opt for financing and to become “fleet managers” (the official term) at an immediate disadvantage. Here are two examples based on the legal fine print in the contract: Bird retains title to the scooters even after fleet managers pay off the debt and Bird charges equipment fees and those don’t go away if the scooter is lost or stolen.

Other micromobility news …

Amazon is beefing up its e-bike delivery team in New York City with two new hires, including a former Uber manager. Alex Vickers, previously worked on the business development team at Jump, joined Amazon in June to serve as a senior program manager on the company’s electric bikes unit, CNBC reported. Amazon also hired Justin Ginsburgh, who co-founded New York City’s Citi Bike bikeshare service, to lead the e-bike team.

Gotcha Mobility, a subsidiary of Last Mile Holdings, has launched a new fleet of e-bikes. The company said the redesigned bikes offer a more comfortable ride, smoother electric motor and longer battery life. The bikes include airless tires and an updated frame and electric motor manufactured by ANANDA.

Deal of the week

I’ve become fascinated with Uber, specifically how its CEO and executive team are attempting to reshape it — offloading certain assets and upping investment in others, all while trying to stanch the bleeding in its core ride-hailing business that has been affected by the COVID-19 pandemic.

If you took a look at Uber’s business model one year ago today, it could be categorized as an “all of the above approach,” a strategy to generate revenue from all forms of transportation, including ride-hailing, micromobility, transit, logistics and package and food delivery. COVID-19 upended that strategy, but I don’t think the pandemic is the sole driver of change over at Uber.

The company dumped its shared micromobility unit Jump this spring and doubled down on delivery with its acquisition of Postmates. This week, Uber sold a stake in its growing, but still unprofitable logistics arm, Uber Freight. Meanwhile, Bloomberg cited unnamed sources that the company is considering a purchase of Daimler AG and BMW AG’s ride-hailing joint venture Free Now.

The gist of the Uber Freight deal is this: An investor group led by New York-based investment firm Greenbriar Equity Group has committed to invest $500 million in a Series A preferred stock financing for Uber Freight. The deal values the unit at $3.3 billion on a post-money basis. Greenbriar managing partners Michael Weiss and Jill Raker will join the Uber Freight board. Uber didn’t name the other investors.

Uber says this doesn’t change its commitment to its logistics arm, noting that it will maintain majority ownership in Uber Freight and will use the funds to continue to scale the business. Still, the move telegraphs Uber’s broader strategy right now, which seems to be all about bringing in capital and either dumping unprofitable assets or sharing the load with others.

Other deals that got my attention …

Cazoo, the UK company that developed an app for consumers to browse and buy used cars, raised £240 million ($311 million) in new funding. This follows the $116 million it raised just six months ago. The company is now valued at more than £2 billion (or over $2.5 billion), according to a Cazoo spokesperson. This is double its previous valuation. And as TechCrunch editor Ingrid Lunden notes, “For some context, the company confirmed a $1 billion valuation this summer, and others had estimated it at a much lower amount.”

Einride raised $10 million in new funding led by impact fund Norrsken VC, and other investors, EQT Ventures fund (“EQT Ventures”), Nordic Ninja VC, and Ericsson Ventures. The Swedish autonomous vehicle startup is known for its futuristic pods designed to haul freight.

Goldman Sachs Group is buying General Motors’ credit-card business for about $2.5 billion, WSJ reported.

Neuron Mobility, a Singapore-based e-scooter rental startup, added $12 million to its Series A in a road led by Australian venture capital firm Square Peg and GSR Ventures. This increases the round’s new total to $30.5 million. The company, which operates in Australia and New Zealand in addition to Southeast Asian markets, has been hanging at least part its growth plan on consumers turning to scooters and ebikes during the COVID-19 pandemic. Catherine Shu’s report digs deeper into the economic and regulatory dynamics of micromobility in Australia and New Zealand.

Northvolt AB, Swedish battery-cell manufacturer founded by former Tesla executives, raised $600 million from a slew of high-profile names including Spotify CEO Daniel Elk, former Kinnevik chairwoman Cristina Stenbeck and Niklas Adalberth’s venture capital firm Norrsken, Bloomberg reported. If the name Northvolt rings a bell it might be because I mentioned back in a July edition of The Station that BMW struck a long-term deal with the company for $2.3 billion worth of battery cells. The battery cells will be produced in Europe at the Northvolt factory that is under construction in northern Sweden.

ScriptDrop, the medication delivery platform, raised $15 million in a Series A funding round led by the Ohio Innovation Fund, per Crunchbase.

Image Credits: Uber Freight

Notable reads and other tidbits

Now that Nikola founder Trevor Milton is out of the day-to-day picture, the company is engaged in the necessary task of clearing out the mess and attempting to build investor confidence. Nikola chairman Steve Girsky, who took over the role after Milton left, is clearly making moves to get the company back on track.

The company announced that it appointed Steve Shindler as a new independent director. He will also chair the company’s audit committee. Shindler most recently served as CFO of VectoIQ Acquisition Corp, the special purpose acquisition company that Girsky formed in 2018 and merged with Nikola in June.

Meanwhile, Nikola said that Lonnie Stalsberg has decided to retire after more than three years on the board.

The company also issued a lengthy press release that laid out its business plans and production targets, stating that it “remains committed to achieving” a set of milestones it had previously announced. It should be noted that Nikola did cancel its Nikola World event that was scheduled December, citing COVID-19 related regulations.

The strategy has so far seemed to ease investors concerns, helping Nikola shares recover some of the losses it experienced in the past three weeks.

In other news …

Karma, the EV company, has tapped Ayro, an engineer and manufacturer of light-duty, urban and short-haul electric vehicles, as its contract manufacturer. The companies aim to be able to deliver more than 20,000 light-duty trucks and electric delivery vehicles over the next three years. The partnership will initially serve customers in North America.

Agero has added a new rideshare option to its digital accident claims management platform. The new option will be serviced by Lyft. Under this new option, participating insurers can offer a Lyft ride from the scene of an accident, or at any point during the repair process.

GM said its testing the Cruise Origin’s Ultium battery system on the track at its proving grounds in Milford, Mich., and will have preproduction vehicles coming next year. If you remember the Cruise Origin, you’ll recall that this is the purpose-built, all-electric and self-driving vehicle that combined the resources of GM, Honda and Cruise. The vehicle will be built at GM’s Detroit-Hamtramck assembly plant and will be powered by its Ultium battery system.

Electrify America is deploying eight new solar-powered, off-grid charging stations across Fresno County in California. As someone who has made the drive from Arizona up to San Francisco multiple times in a variety of electric vehicles, I’ve always wondered and wished why more charging stations didn’t have solar. Yes, I know Tesla CEO Elon Musk has made promises about solar-power superchargers since the network first began scaling in 2012. Today, there are fewer than five.

The National Highway Traffic Safety Administration released a preview of 2019 data from the Fatality Analysis Reporting System and preliminary estimates for the first half of 2020. The upshot: traffic deaths decreased 2% in 2019 from the year prior with 36,096 fatalities in motor vehicle traffic crashes. The fatality rate for 2019 was 1.10 fatalities per 100 million vehicle miles traveled, the lowest rate since 2014.

This year though, welp … NHTSA said FARS data indicate the traffic fatality rate per 100 million VMT is projected to increase to 1.25 in the first half of 2020, up from 1.06 in the same period in 2019. NHTSA says the rise is because the total traffic volume decreased by more than 16% in the first six months of 2020. So, fewer drivers and yet more crashes.

TuSimple hired Jim Mullen, the former Acting Administrator of the FMCSA (the government agency that regulates trucking in the U.S.). as its chief legal and risk officer. He will oversee legal affairs, risk management strategy, and help continue to develop TuSimple’s approach to safety, the company said.