Tesla boss Elon Musk is not known for admiring his competition, but when Chinese manufacturer Nio made its 100,000th electric car last week, he offered his congratulations.
It was a mark of respect from a chief executive who had been through “manufacturing hell” with his own company. Yet it is also a sign of the growing influence of China’s electric carmakers. They are hoping to stake out a spot among the heavyweights of the new industry and bring a significant new challenge to Tesla – and to the rest of the automotive industry as it scrambles to catch up.
Tesla mania and cheap money have pushed the market valuations of a clutch of electric carmakers to astonishing levels. Tesla’s value topped $830bn (£600bn) in January (it is now down at about $700bn – still almost three times the size of its nearest rival, Japanese carmaker Toyota).
Chinese rivals Nio, Xpeng and Li Auto have all rapidly risen in value to rival much bigger and longer-established manufacturers – despite having never made an annual profit – on the back of US stock market listings that brought access to retail investors, although their values have fallen steeply from highs earlier this year.
Their fundraising successes have allowed them to pour money into competing with Tesla in China. Now they are eyeing the European electric car market – the biggest in the world.
This would further squeeze legacy carmakers such as Volkswagen, which are trying to rapidly expand electric car production. Premium carmakers including the UK’s Jaguar Land Rover or Germany’s BMW could also lose out if Chinese brands take some of their wealthy customers. Jaguar has pledged go all-electric by 2025 and BMW said last month that half its European sales will be electric by 2030.
China’s government spotted the opportunity to dominate a new sector by giving big subsidies to its electric car industry. The resulting crop of Chinese manufacturers is following the Tesla playbook and it, too, is unencumbered by the costs of winding down internal combustion engine factories, according to Philippe Houchois, automotive analyst at US investment bank Jefferies.
Li Auto, Nio and Xpeng could grow into some of Tesla’s biggest rivals – Reuters reported last month that all three are eyeing listings in Hong Kong. Another Chinese-owned startup, Faraday Future, said in January that it would list in the US via a merger with a special purpose acquisition company (Spac), raising $1bn.
“If you’re Tesla, all of a sudden they are competing on the ground, but they are also competing in access to capital,” Houchois says.
Some Tesla rivals have comparable technology and similarly aspirational brands. Hui Zhang, Nio’s executive vice-president for Europe, told the Observer the luxury carmaker aims to combine elements of Tesla and of Apple, the world’s most successful consumer technology company.
Nio, known as Weilai in its home market, aims to start selling vehicles in Europe later this year. Its factory can currently produce about 120,000 cars a year, significantly fewer than the near-500,000 Tesla made in 2020. Nio avoided bankruptcy in early 2020 when the city of Hefei bailed it out, but it has raised more than $4.5bn in stock and bond offerings in recent months, amid soaring investor demand.
Tesla will have an advantage in Europe when it opens a factory in Berlin as early as this summer, but China’s carmakers have the capital to open production in Europe too. Matthias Schmidt, a Berlin-based automotive analyst, says Chinese manufacturers will have an opportunity while Europe’s giants are eking out profits from their petrol and diesel models, plus hybrids.
“Chinese manufacturers hoping to introduce battery electric vehicles,” says Schmidt, “ have a four-year window in which to gain traction in a market that is to some extent playing with a B team array of electrified products, with limited supply until the end of the first half of the decade.”
Chinese companies are already heavily involved in the electric car boom through lithium ion battery manufacturing. China’s Contemporary Amperex Technology – better known as CATL – is a supplier to Tesla, has a factory in Germany, and last year said it had developed a battery capable of surviving a million miles of driving and recharging.
Another battery maker that also produces electric cars is BYD, backed since 2008 by US investment billionaire Warren Buffett. Shares in the company, listed in Shenzhen, have more than tripled since the start of 2020 – even after falling from record highs at the start of February. It capitalised on investor interest in January, selling stock worth $3.9bn.
Deep-pocketed rivals can spend heavily on technology, which adds to the pressure on Tesla. Nio’s big selling point is that its batteries can be swapped in minutes by robots – removing the threat of range anxiety for drivers of electric vehicles. Xpeng, valued at $24bn, has invested heavily in autonomous driving software, so could rival Tesla through lucrative sales of subscription-based self-driving capabilities. Its P7 sports saloon could target potential buyers of Tesla’s Model 3 and Model S in Europe, rather than the wealthier customers courted by Nio.
Xpeng, chaired by tech entrepreneur He Xiaopeng, has already launched its G3 SUV in Norway –which, thanks to government subsidies, last year became the first country to see sales of electric cars outstrip those of internal combustion engines. Xpeng is now deciding which European markets to target next, its vice chair, Brian Gu, told Automotive News in January.
Analysts have repeatedly cautioned that the electric car industry, from Tesla downwards, is in the midst of a bubble. Yet even if valuations tumble further after recent steep declines, the makers have already enjoyed cheap funding that will allow them to vie for a significant slice of the market.
“Underneath what happens with the stock price, it’s a belief in the electric vehicle industry,” said Nio’s Zhang. “It’s a belief in the business model that a company like Nio or Tesla is trying to strike.”
How they compare
Xpeng P7 Guangzhou-based Xpeng is considering launching its P7 premium saloon in Europe, with downloadable updates to self-driving software. Price 229,900 yuan in China (£25,600) Range 439 miles (according to the relatively lenient NEDC standard)
Nio ET7 A very large battery gives Nio’s saloon a long range and fast acceleration – 3.9 seconds to 62mph – as it goes up against Tesla’s Model S. Price 448,000 yuan (£50,000) Range 621 miles (NEDC)
BYD Tang EV600 Formerly a plug-in hybrid, the battery version of the Tang SUV will be on sale in Norway this year. Price 260,000 yuan (£28,900); Range 373 miles (NEDC)
Tesla Model Y Musk’s seven-seater SUV will be the first off the production line in Berlin. The performance version can manage 0 to 60mph in 3.5 seconds. Price $34,000 (£24,600) Range 303 miles (according to the stricter WLTP standard)
A Ubiquiti developer has been charged with stealing data from the company and extortion attempts totalling $2m in what prosecutors claim was a vicious campaign to harm the firm’s share price – including allegedly planting fake press stories about the breaches.
US federal prosecutors claimed that 36-year-old Nickolas Sharp had used his “access as a trusted insider” to steal data from his employer’s AWS and GitHub instances before “posing as an anonymous hacker” to send a ransom demand of 50 Bitcoins.
The DoJ statement does not mention Sharp’s employer by name, but a Linkedin account in Sharp’s name says he worked for Ubiquiti as a cloud lead between August 2018 and March 2021, having previously worked for Amazon as a software development engineer.
In an eyebrow-raising indictment [PDF, 19 pages, non-searchable] prosecutors claim Sharp not only pwned his employer’s business from the inside but joined internal damage control efforts, and allegedly posed as a concerned whistleblower to make false claims about the company wrongly downplaying the attack’s severity, wiping $4bn off its market capitalisation.
Criminal charges were filed overnight in an American federal court against Sharp, of Portland, Oregon. The indictment valued the 50 Bitcoins at $1.9m “based on the prevailing exchange rate at the time.”
US attorney Damian Williams said in a US Justice Department statement: “As further alleged, after the FBI searched his home in connection with the theft, Sharp, now posing as an anonymous company whistle-blower, planted damaging news stories falsely claiming the theft had been by a hacker enabled by a vulnerability in the company’s computer systems.”
Sharp is alleged to have downloaded an admin key which gave him “access to other credentials within Company-1’s infrastructure” from Ubiquiti’s AWS servers at 03:16 local time on 10 December 2020, using his home internet connection. Two minutes later, that same key was used to make the AWS API call GetCallerIdentity from an IP address linked to VPN provider Surfshark – to which Sharp was a subscriber, prosecutors claimed.
Later that month, according to the prosecution, he is alleged to have set AWS logs to a one-day retention policy, effectively masking his presence.
Eleven days after the AWS naughtiness, the indictment claims, he used his own connection to log into Ubiquiti’s GitHub infrastructure. “Approximately one minute later,” alleged the indictment, Sharp used Surfshark to ssh into GitHub and clone around 155 Ubiquiti repos to his home computer.
“In one fleeting instance during the exfiltration of data,” said the indictment, “the Sharp IP address was logged making an SSH connection to use GitHub Account-1 to clone a repository.”
For the rest of that night, prosecutors said, logs showed Sharp’s personal IP alternating with a Surfshark exit node while making clone calls. Although it was not spelled out in the court filing, prosecutors appeared to be suggesting that Surfshark VPN was dropping out and revealing “the attacker’s” true IP.
Ubiquiti discovered what was happening on 28 December. Prosecutors claimed Sharp then joined the company’s internal response to the breaches.
In January 2021 Ubiquiti received a ransom note sent from a Surfshark VPN IP address demanding 25 Bitcoins. If it paid an extra 25 Bitcoins on top of that, said the note, its anonymous author would reveal a backdoor in the company’s infrastructure. This appears to be what prompted Ubiquiti to write to its customers that month alerting them to a data breach. Ubiquiti did not pay the ransom, said the indictment.
Shortly after Federal Bureau of Investigation workers raided Sharp’s home, prosecutors claim he “caused false or misleading news stories to be published about the Incident and Company-1’s disclosures and response to the Incident. Sharp identified himself as an anonymous source within Company-1 who had worked on remediating the Incident. In particular, Sharp pretended that Company-1 had been hacked by an unidentified perpetrator who maliciously acquired root administrator access [to] Company-1’s AWS accounts.”
Sharp is innocent unless proven guilty. He is formally charged with breaches of the Computer Fraud and Abuse Act, transmitting interstate threats, wire fraud and making false statements to the FBI. If found guilty on all counts and handed maximum, consecutive sentences on each, he faces 37 years in prison. ®
Other winners at the Irish Medtech Association awards included Alcon Ireland, West, Vertigenius, Luminate Medical, BioMEC, Jabil Healthcare, Cook Medical and Aerogen.
Limerick-headquartered business Serosep has been named Irish Medtech Company of the Year at a virtual conference hosted today (2 December) by The Irish Medtech Association with Enterprise Ireland and IDA Ireland.
The Irish Medtech Association which represents the medtech sector in Ireland made the announcement at its annual Medtech Rising conference. This year’s awards ceremony was the first to feature new categories. Alcon Ireland won the Sustainable Medtech company of the Year, while West scooped the Best Medtech Talent Strategy Award.
According to the association’s director Sinéad Keogh, the annual awards ceremony offers the medtech community a chance to “recognise and celebrate the strength and importance of the industry in improving life.”
“The sector has remained resilient despite the challenges of the Covid pandemic, with over 42,000 people now working in the industry, across 450 companies,” she added.
The overall winner, Serosep, is a self-funded, family run business, which manufactures clinical diagnostic products at its base in Annacotty, Co Limerick. It serves more than 35 different countries spread over 5 continents. The company is 25 years in business and employs 114 people. Earlier this year, it announced a five-year contract to supply its gastroenteritis diagnostic system to Liverpool University Hospital. The company already supplies the NHS.
Serosep CEO and founder Dermot Scanlon, said he was “humbled” to receive the award, adding that the company’s innovative diagnostic test tools have “changed the way gastroenteritis is tested in clinical laboratories.”
“We are currently manufacturing in excess of one million tests in our state-of-the-art facility,” he said, explaining that the award would motivate the whole company to “continue forging ahead, achieving bigger and better things.”
Other award winners included:
Trinity College Dublin spin-out Vertigenius, winner of the eHealth Innovation of the Year Award. Vertigenius is a platform which aims to enhance clinical and patient engagement in the treatment of balance problems.
Luminate Medical, winners of the Emerging Medtech Company of the Year Award. The NUI Galway spin-out has developed a technology to prevent chemotherapy induced hair loss.
NUI Galway’s Biomechanics Research Centre (BioMEC) won the Academic Contribution to Medtech Award. The company’s technology integrates the latest in silico computational models to simulate the mechanical performance of implanted coronary stents.
Bray-based Jabil Healthcare scooped the Medtech Partner/Supplier of the Year Award for its new Covid-19 PCR testing device.
Cook Medical received the Women in Leadership Company initiative Award for its commitment to gender balance in the workplace.
The Covid-19 Response Recognition Award was awarded to Aerogen which has developed an inhaled vaccine station. The company’s products have been used on more than 3m critically ill people since March 2020, according to Enterprise Ireland’s head of life sciences, Deirdre Glenn. Aerogen won last year’s Medtech Company of the Year award.
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The Morrison government insists it is negotiating with the states about “future uses” for its troubled Covidsafe app despite it not being used during the outbreaks that prompted lockdowns in Victoria, New South Wales and the Australian Capital Territory.
The government is also refusing to release how many Australians continue to use the app, with one tech expert accusing the government of trying to avoid disclosing embarrassing data rather than admit it had failed to achieve its purpose.
Since vaccination rates reached more than 90% of the eligible population in most states, contact tracing is slowly being scaled back, with health authorities limiting the number of people contacted and asked to test and isolate.
Even when contact tracing played a critical role in reducing the number of cases, the app was of little assistance.
Almost none of the contacts were identified through the federal government’s CovidSafe contact tracing app despite well over 7 million people in Australia downloading it last year and the prime minister, Scott Morrison, declaring it the ticket out of lockdown.
Since launching in April last year, just 17 “close contacts” in NSW were found directly through the app that were not otherwise identified through manual contact tracing methods.
Guardian Australia has been engaged in a year-long freedom of information battle with the Digital Transformation Agency to reveal how many people continued to use the app after installing it.
This month the agency said releasing the information would hurt negotiations with the states over the app’s future uses.
“The Commonwealth is engaged in ongoing consultations and discussions with the states and territories on a framework around the use of Covidsafe data and data derived from Covidsafe data as a key tool for contact tracing,” DTA’s chief technology officer, Anthony Warnock, told the Office of the Australian Information Commissioner in a letter provided to Guardian Australia.
When asked about these discussions, both NSW and Victoria said the app had not been used at all in 2021.
“To date, it has not been necessary to use the Covidsafe app with any case clusters in 2021,” a NSW Health spokesperson said. “NSW Health’s contact tracing team has access to a variety of information to contain the spread of Covid-19 and keep the community safe.”
The ACT also said the app had never been used in the capital and, as of September, Queensland said it had used the app twice, with one contact identified but no positive cases identified.
It’s also unclear what future uses the federal government is considering.
Electronic Frontiers Australia’s chair, Justin Warren, who has been involved in complex FOI battles with the government, suggested the only reason the the release of the information would be damaging was if it showed far fewer people continued to use the app.
“The DTA appears to be trying to argue that we can’t learn the truth about just how big a lemon the Covidsafe app is because then people might know it’s a lemon and act accordingly,” he said. “It’s clear to me that they wouldn’t try to make this argument if the app was useful.”
The app costs around $75,000 a month to run, and a spokesperson for the federal health department said there were “no plans” to shut it down until the health minister determined it was no longer required.
Experts in the tech community last year called for the app to be modified using the Apple-Google exposure notification framework, which would work similarly to the UK’s NHS app and alert people when they had been in contact with a confirmed Covid-19 case.
A study published in Nature in May about how effective the NHS app in England and Wales had been between September and December last year found that for every positive case who agreed to alert their contacts, one case was averted.
But a ministerial brief prepared by the DTA in May 2020, released this week on the transparency website Right to Know, reveals that the government believed it would require massive changes to the app and privacy laws to accommodate the change.
“The app would need to be significantly redesigned and rebuilt,” the agency said. “The ENF cannot simply be embedded into the current app. The health portal would also need to be redesigned and rebuilt.”
The DTA warned that a new privacy assessment would need to be undertaken, legislation might need to be amended, all current users would need to download and re-register through the app, and contact data could not be transferred.
The briefing also noted that the alerts people received through the app “may cause alarm” if contact tracers were not involved in the process.
But the agency said a change to the Apple/Google version would improve connectivity between devices and might encourage people who had hesitated to download the original app.
“Certain users who have avoided the app may perceive that the ENF provides stronger privacy protections through this largely decentralised non-government-controlled model.”
Victoria now automatically alerts people who were at high-risk venues through the Service Victoria app, and advises them to test and isolate, but does not do any further contact tracing except when someone tests positive.
NSW is planning to ditch QR code check-ins from all but high-risk venues from 15 December, or when the state reaches 95% of the eligible population having two doses of the vaccine.