Musk says Tesla, Samsung Electronics sign chip supply deal
On Saturday, Samsung announced a $16.5 billion chip supply deal with a major global company, without naming the client. It said the customer had requested confidentiality about the details of the deal, which will run through the end of 2033.
Three sources briefed about the matter told Reuters that Tesla (TSLA.O), opens new tab was the customer for the deal.
The deal comes as Samsung faces mounting pressure in the race to produce artificial intelligence chips, where it trails rivals such as TSMC and SK Hynix (000660.KS), opens new tab. This lag has weighed heavily on its profits and share price.
Samsung, the world's top memory chip maker, also makes logic chips designed by customers through its foundry business.
Pak Yuak, an analyst at Kiwoom Securities, said the latest deal would help reduce losses at Samsung's foundry business, which he estimated exceeded 5 trillion won ($3.63 billion) in the first half of the year.
Analysts say Samsung has struggled with the defection of key clients to TSMC for advanced chips. TSMC counts Apple (AAPL.O), opens new tab, Nvidia (NVDA.O), opens new tab and Qualcomm (QCOM.O), opens new tab among its customers.
The Samsung-Tesla deal is also significant for South Korea, which is seeking U.S. partnerships in chips and shipbuilding amid last-ditch efforts to reach a trade deal to eliminate or reduce potential 25% U.S. tariffs.
It is not clear how the order would affect Samsung's plan to start production at its new factory in Texas, which has been delayed as it struggles to win major customers.
Samsung is grappling to boost production yields of its latest 2-nanometer technology, and the order is unlikely to involve the cutting-edge tech, Lee Min-hee, an analyst at BNK Investment & Securities, said.
Samsung has been losing market share to TSMC in contract manufacturing, underscoring technological challenges the firm faces in mastering advanced chip manufacturing to attract clients like Apple and Nvidia, analysts said.
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Telegraph
31 minutes ago
- Telegraph
Tesla Model Y review: Long overdue revamp fails to address the world's favourite EV's main flaws
There have certainly been better years for Tesla, and scarcely a day goes by without more doomslaying for the electric car maker founded in July 2003 by Martin Eberhard and Marc Tarpenning. Elon Musk became the company's largest shareholder in 2004 and chief executive in 2008. In 22 years, the company has become a phenomenon, with growth partly fuelled by the undoubted virtuosity of its cars, but also profits driven by environmental grants and CO2 trading with traditional car makers. Tesla has seen whopping share-value growth and made life-changing amounts for its investors, which perhaps also fuels the fan-boy hype. One estimate suggested that $1,000 invested in 2010 would now be worth almost $270,000 (£203,000), and in February this year Tesla's worth exceeded one trillion US dollars. Where rival car manufacturers have been worthy-but-dull investments, Tesla took off like a SpaceX rocket, at times the 11th and then the sixth most valuable company in the world. Then there's the Preston Tucker -like hucksterism of Musk, adored as a visionary engineer and rainmaker by some, loathed by others for his grant-aid grabbing and Bitcoin-investments hypocrisy, his toadying up to President Trump, his bullying behaviour and vote-buying in Wisconsin, among others. Oh, and that straight-arm salute at Trump's inauguration… Backlash against Musk The backlash has been a while coming, but it has been furious, with the share price tumbling by 10 per cent at the time of writing, sales plummeting, pickets around North American dealerships and the questioning of Musk's Panglossian announcements, which increasingly fail to materialise. As rivals including Waymo, Volkswagen and others take the lead in self-driving cars; established car makers and the Chinese catch up with the EV revolution just at a time when the public becomes disenchanted with them; and Trump halts the EV grants that have been so crucial to Tesla's success. Investors are questioning Musk's commitment to Tesla, and even he admits that it's a 'rocky road ahead'. As for the Model Y, Tesla's SUV mainstay and in 2023 the world's best-selling car, a revamp earlier this year hasn't exactly been a runaway success. In the first six months of this year, Tesla's European market share plummeted from 2.4 per cent to 1.6 per cent, and sales of the Model Y, while still the best-selling BEV in Europe, were about 50 per cent down in the first five months, although they picked up in June. Current owners speak out While I was waiting for a Tesla Supercharger at a motorway service station, the owner of a current Model Y came up to talk. 'Is that the new Y?' he asked. 'How's it going?' He assailed me with his car's issues: software glitches, patchy build quality, terrible ride quality, uncomfortable seats, poor dealer servicing – along with massive depreciation, after Tesla dropped the price of the Model Y by up to £8,000 in January 2023. This is a blink-and-you'll-miss-it revamp; a blade-type front light bar and a shuffling of panel gaps at the rear to make repairs simpler and cheaper. It has the same steel and aluminium bodyshell but it is more aerodynamic. The suspension consists of front wishbones, with a multi-link rear and passive damping. Yet overall the Model Y is still weirdly dumpy, with a mysteriously high, bowed roofline. Our test car had £2,100-worth of 20in wheels (the standard items are 19in), £1,300 for the white paint (now a priced option – only black and grey are standard) and the £3,400 enhanced Auto Pilot system, all of which takes the price from the standard £48,990 to £55,790 on the road. Business contracts, which are where many of these cars are sold, start at £531 per month for a three-year/8,000 miles-a-year deal. Competition, which when the Model Y was launched five years ago was scant, is now myriad. So think of the Skoda Enyaq, Polestar 4, BYD Sealion 7, Hyundai Ioniq 5, Kia EV9 or Renault Scenic E-Tech – and that's before you get to the Germans. Inside information Using the credit card-sized key or a programmed mobile phone, opening the car requires a tap in an unmarked place on the driver's side centre pillar. The interior resembles a Hollywood version of an evil computer boss's office, stark with grey and matt black fabrics, along with plastics interspersed with aluminium. Warm and welcoming it is not. With acoustic glass all round, the sound-deadening is eerie and your ears pop with the pressure change as the doors shut. Accommodation is generous, with copious leg and head room front and rear, although the front seats are mounted quite high. It only has five seats; there's no word yet on whether the AWD Long Range will get a seven-seat option as before. It takes a while to find an ostensibly comfortable driving position, partly because the steering column adjustment is buried in the touchscreen. The low base of the windscreen gives the impression of looking down at the road but, much worse, the front seats are spectacularly uncomfortable during a long journey, due to a strange shape on the backrest and an unsupportive squab. At 2,138 litres with the rear seats folded, the load space is massive, and there's further storage under the boot floor and beneath the bonnet. The electric folding rear seats should be shown to rivals as an example of how to do it; the amateur-hour folding-plank luggage space cover as an example of how not to… It weighs 1,901kg and tows up to 1.6 tons. Too clever by half 'They've given you an indicator stalk,' said the PR in hushed tones, as if Tesla had actually invented the steering-column stalk instead of removing it from its cars and then, when drivers didn't like that, reinstating it. Apart from that, there are few buttons and the central touchscreen dominates the driving experience, by turns brilliant and ingenious and at others exasperating, stupid and distracting. Much of the innovation is too clever by half and a quarter as useful. Take the Auto Shift system, which automatically changes between reverse and forward gears and vice versa when manoeuvring, but quite often leaves you in the wrong gear. The Autopilot 'self-driving' system works all right, but is a poor driver, braking in the middle of corners, slamming on the brakes at nothing, taking its speed limit cue from slip roads and steering erratically through bends. There's no Apple CarPlay or Android Auto in a Tesla for a variety of reasons, not all of them understandable, and the mobile-to-car pairing is far from seamless. The automatic tilting mirrors are useful when reverse parking next to a kerb, but not when reversing normally; changing between the two is a finger-stabbing chore. 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The ride is pretty terrible and noisy. The springing feels soft yet the damping is abrupt and harsh, while the bodyshell feels less than the last word in stiffness. This might be due to the 20in wheel option, but it clumps and crashes noisily and never quite settles on motorways. Similarly, and despite the massive tyres, the handling doesn't inspire confidence. The turn-in to corners feels inconsistent and the softly sprung front end reacts badly if you back out halfway through, or adjust your chosen line. The Telegraph verdict The revamped Model Y is efficient, relatively light, well priced and swooshes with the best of EV rivals. It's not much fun to drive, although that also applies to a lot of rivals. But then, as James Carville, Bill Clinton's strategist, once said: 'It's the economy, stupid.' Tesla's Supercharger network costs 36-39p per kW compared with the highway robbery of some providers charging upwards of 85p per kW for rival battery-powered SUVs I could recommend as decent drives. In addition, the tax savings for those running a car through the business are generous (under salary sacrifice, some can save hundreds per month in tax). Small wonder it's so popular; during my week-long test I saw a lot of Tesla taxis, and cabbies know a cheap-to-run vehicle better than most. I just find it hard to forgive the ride and handling and the bloody uncomfortable seats. I would love to spend a couple of days with Tesla's vehicle attributes team to address those issues, but as we know, the firm doesn't speak to anyone, it simply sells cars. The facts On test: Model Y Long Range Rear-Wheel-Drive Body style: five-door, five-seat SUV/crossover On sale: now How much? from £48,990 (£55,790 as tested) How fast? 125mph, 0-62mph in 5.4sec How efficient? 4.38m/kWh (WLTP Combined); 4m/kWh on test Powertrain: 83kWh net (78kWh) lithium-ion NMC battery with single AC permanent magnet synchronous motor, rear-wheel drive Range: 387 miles (WLTP), 312 miles on test Charging: 11kW on-board charger; DC charging up to 250kW with 20-80 per cent in 27min Maximum power/torque: 335bhp/332lb ft CO2 emissions: 0g/km (tailpipe), 23.6g/km (CO2 equivalent well-to-wheel) VED: £10 first year, £620 next five years, then £195 Warranty: four years/60,000 miles on vehicle, eight years/150,000 miles on battery The rivals Skoda Enyaq SportLine 85kW RWD From £46,585 While prices start at £39,010, this is the closest version to the Model Y, with an 85kWh battery, 354-mile range, a top speed of 111mph and 0-62mph in 6.5 sec. The optics are a bit mumsy, but it rides well and has comfortable seats. Kia EV9 RWD From £65,920 A striking seven-seat electric SUV, with a range of 349 miles from its 99.8kWh battery, with a top speed of 114mph and 0-62mph in 9.4sec. Pretty good to drive, but most buyers choose the more expensive all-wheel drive versions.
Reuters
31 minutes ago
- Reuters
Asia-US sea freight rates set to extend declines amid tariff chaos
SINGAPORE, Aug 5 (Reuters) - Asia-U.S. sea freight rates are set to drop further in 2025 as shipping capacity outpaces demand and trade routes shift due to tariffs and geopolitical tensions, though vessel rerouting is expected to limit some losses, industry experts said. Average spot rates for containers from Asia to the U.S. west and east coasts have slumped by 58% and 46%, respectively, since June 1 and are expected to fall further, according to shipping analytics firm Xeneta. Adding to uncertainty are unresolved trade talks between the U.S. and China. Officials from the world's top two economies last week agreed to seek an extension of their 90-day tariff truce. The China-U.S. trade lane remains one of the most profitable for container ship operators. Sea freight saw a brief uptick in late May and early June as shippers took advantage of a 90-day pause in U.S. President Donald Trump's tariffs, but rates quickly fell as capacity outweighed demand, Xeneta data showed. "There is significant overcapacity globally and this will continue to shape the market," said Erik Devetak, Xeneta's chief technology and data officer. "China-to-U.S. trade is dampened and the EU economy is not exactly hot, so blanked sailings and cancellations will become a recurring theme as carriers desperately try to keep freight rates up," Devetek said. Blanked sailing refers to cancelled port calls or voyages. Logistics major DHL noted that spot rates, which rose in the early summer surge of traffic from Asia to North America, have since reversed. "Carriers rushed to add capacity on the transpacific to chase early gains, but oversupply is becoming apparent as the momentum fades," said Niki Frank, CEO of DHL Global Forwarding Asia Pacific. Jarl Milford, maritime analyst at Veson Nautical, expects rates to decline steadily in the second half when more vessels are expected to enter the market. "Ongoing uncertainty, including tariff policy and slowing global demand, adds continued pressure," Milford said. Ocean Network Express, a joint venture between Japan's Kawasaki Kisen Kaisha (9107.T), opens new tab, Mitsui O.S.K. Lines (9104.T), opens new tab and Nippon Yusen (9101.T), opens new tab, said last week that "recent trade uncertainties further complicate visibility for the latter half of the fiscal year". A key factor helping absorb some of the excess capacity, however, is the rerouting of vessels from traditional sailings. Carriers are diverting from the Red Sea following attacks by Yemeni Houthis, and some are bypassing U.S. ports to avoid tariffs. These longer voyages are soaking up more ships and helping provide a floor for rates, analysts said. "These diversions continue to soak up in excess of 10% of containership supply, leading capacity utilization to a healthy level in the 86-87% range," analysts at Jefferies Research wrote, referring to the Red Sea. And while China's exports to the U.S. have fallen, shipments elsewhere have climbed. Jefferies analysts said spot bookings to the U.S. in recent weeks suggest July volumes are likely to be down, pushing transpacific freight rates to their lowest this year, but rates to markets such as Europe and Latin America remain elevated.
Daily Mail
an hour ago
- Daily Mail
Tesla board approves new £22bn pay package to keep Elon Musk
Tesla has handed Elon Musk £22billion worth of shares after the tycoon threatened to quit the electric car maker. The firm said its board agreed to give its billionaire head 96m shares as part of a pay deal, according to a recent filing. Tesla's share price of $309.60 values the package at £22.3billion, but under the plan Musk must pay the company $23.34 a share – about £1.7billion. The firm said it was 'an important first step' in compensating Musk for 'his extraordinary work', adding: 'Retaining Elon is more important than ever before', and crucial in attracting new talent as Tesla shifts its business towards AI and self-driving robo-taxis. Daniel Ives, analyst at Wedbush Research, said the package would be enough to 'keep Musk as chief executive of Tesla at least until 2030,' and that he was the firm's 'most important asset'. Musk, the largest shareholder with a 12.7 per cent stake, threatened to quit if he was not given more shares, saying activist shareholders could 'easily' oust him. He and the company remain embroiled in a legal battle in Delaware over a £42billion pay award granted to Musk in 2018. That was struck down by a judge last year, who ruled it excessive.
