Hertz orders 100,000 Teslas, and both companies’ shares shoot up.

The order, to be fulfilled between now and the end of next year, is a sign of the growing momentum in the shift toward electric cars.

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The Tesla order would give Hertz one of the world’s largest fleets of rental electric vehicles.Credit…Arnd Wiegmann/Reuters

Hertz, the car rental agency, said on Monday that it had ordered 100,000 Teslas, a bold move for a company just emerging from bankruptcy and a sign of growing momentum in the shift to electric vehicles.

By the end of next year, when the Tesla order is completed, electric vehicles will make up more than 20 percent of Hertz’s global vehicle fleet, the company said.

“Electric vehicles are now mainstream, and we’ve only just begun to see rising global demand and interest,” Mark Fields, Hertz’s interim chief executive, who previously led Ford Motor, said in a news release. “The new Hertz is going to lead the way as a mobility company, starting with the largest E.V. rental fleet in North America and a commitment to grow our E.V. fleet and provide the best rental and recharging experience for leisure and business customers around the world.”

The company declined to comment on the value of the deal. Bloomberg, which reported the news before the announcement, said the order would generate about $4.2 billion of revenue for Tesla, suggesting that Hertz was paying close to face value for the vehicles. Car rental firms typically demand deep discounts for large vehicle orders.

Hertz customers will be able to rent a Tesla Model 3 in some major markets in the United States and Europe starting in early November. The company said that it planned to install thousands of chargers at its locations and that it was teaming up with football quarterback Tom Brady to promote its E.V. offerings in a marketing campaign.

Share prices for Tesla and Hertz were up about 10 percent by early afternoon.

The deal could benefit both companies, said Michelle Krebs, an analyst with Cox Automotive.

“This is unique, and it’s really allowing Hertz to differentiate itself from other rental car companies,” she said. “For Tesla, it’s a great deal because it exposes Tesla’s E.V.s to a much wider array of consumers.”

A large order from Hertz could also help Tesla balance production and manage a shift in demand for its more affordable vehicles. In recent quarters, sales of the Model 3 compact sedan have declined and have been outstripped by those of the Model Y hatchback.

In the months ahead, the company plans to start making the Model Y at plants under construction in Austin, Tex., and in Germany near Berlin. Ramping up those plants could leave less production for its plant in Fremont, Calif.

Sales to rental fleets can have some drawbacks, however. Rental sales are normally a low-margin business, and the cars usually come back into the market as low-mileage used cars. Hertz and its peers typically keep cars for six to 12 months and then send them to auction houses that supply dealers with used vehicles. Over time, this steady stream of former rental cars can cause demand and prices for new cars to fall and can lower the value consumers get for cars they want to trade in. Most luxury auto brands avoid selling cars to rental companies.

It is unclear how Tesla and Hertz have structured their sales agreement. Sometimes rental companies buy cars outright at a discounted price. They can also lease the vehicles, and sometimes automakers agree to buy them back at a set price. This substantially lowers the initial cost for the rental company and enables it to offer attractive daily rental prices.

But it leaves the automaker with considerable risk, because those used cars will eventually sit on dealer lots with low mileage and at prices below those of brand-new models. If auto sales slow, the automaker may end up buying back cars for more than the rental companies paid.

Overreliance on rental sales was one of several ills that helped push General Motors, Ford and Chrysler into trouble during the financial crisis in 2008-9.

For now, Tesla does not appear to face too much risk because the global shortage of computer chips is limiting how many cars automakers can produce and has pushed up demand for and prices of used cars significantly. At Carvana, a large used-car dealer, a 2018 Model 3 with about 30,000 miles sells for about $43,000, about the same as a new one from Tesla.

Hertz filed for bankruptcy in May 2020, falling victim to mounting debt and a devastating blow to its business caused by the coronavirus pandemic. But the quick economic and travel recovery provided a lifeline, setting off a bidding war for the company. Hertz emerged from bankruptcy in June, just as travel started to surge in the United States because of widespread availability of coronavirus vaccines. The bankruptcy allowed the company to shed much of its debt, freeing it to invest in modernizing its fleet.

The travel rebound has also been good for car rental firms, which sold off vehicles to survive the early stages of the pandemic. While they have struggled to rebuild their fleets because of the chip shortage that has held back auto making, that constraint on supply combined with the increase in travel has pushed up rental car prices and use. In August, Avis Budget Group and Hertz reported strong results for the second quarter of the year.

After months of its stock trading in the less-restricted over-the-counter market, Hertz this month also announced plans to list its shares on Nasdaq.

Pinterest says it has over 450 million users. Some analysts had questioned the logic of a PayPal-Pinterest deal.Credit…Dado Ruvic/Reuters

PayPal, the digital payments giant, said late on Sunday that it was not interested in buying the social media network Pinterest, ending efforts to draft a potential $45 billion deal that would have been one of the biggest consumer internet takeovers in a decade.

In a brief statement, PayPal said it was “not pursuing an acquisition of Pinterest at this time.”

A transaction would have been among the biggest ever by PayPal since being spun off from eBay in 2015 and would have bolstered its presence in e-commerce. Pinterest is best known for allowing its 454 million users to pin images and links to their online pinboards and letting them buy goods directly through so-called “buyable pins.” Pinterest largely makes money through advertising instead of online shopping.

PayPal had offered $70 for each share of Pinterest, according to people with knowledge of the discussions, a 25 percent premium to where the digital pinboard’s stock had been trading before news of the talks emerged last week.

Investor reaction to a potential deal was mixed. Shares in Pinterest jumped on the news, while those in PayPal tumbled sharply.

Pinterest has performed well over the last year, with its revenue rising nearly 50 percent in 2020 because of a pandemic-fueled jump in online shopping. But some analysts questioned the logic of a deal and suggested the talks underscored PayPal’s difficulties with tougher competition in its core digital payments business.

FaZe Clan is an influencer marketing agency, e-commerce company and e-sports team all in one. Credit…Adam Amengual for The New York Times

FaZe Clan, the e-sports conglomerate, announced on Monday that it planned to join the public markets in a deal that involves merging with a special purpose acquisition company, or SPAC, which would value it at about $1 billion.

Founded in 2010, FaZe Clan is an influencer marketing agency, e-commerce company and e-sports team all in one. (The company’s chief executive, Lee Trink, once described it as “Dallas Cowboys meets Supreme meets MTV.”) It will be one of the first prominent e-sports companies to go public — and it’s likely to draw attention from the retail traders who helped fuel the SPAC frenzy.

Mr. Trink is a former Hollywood entertainment manager who worked with Kid Rock. The company’s 85 influencers, who live together in its California gamer compound, produce viral social media clips, compete in professional gaming leagues for money and accolades and foster a devoted fan base. FaZe has built on that following by starting an online store and branded merchandise and signing advertising deals with the likes of Burger King.

SPACs are blank-check companies that go public first with the goal of finding a private company to merge with. These can be a way for smaller companies to go public by allowing them to bypass the traditional regulatory scrutiny that comes with initial public offerings.

“We didn’t spend that much time really ideating on a traditional I.P.O. strategy,” Mr. Trink said in an interview, noting that a SPAC deal allows FaZe Clan to talk about future opportunities as it prepares to go public, while a traditional I.P.O. would not.

FaZe, which isn’t profitable, brought in about $38 million in revenue last year and expects to report more than $50 million this year. Mr. Trink said FaZe would use the SPAC to “double down” on content.

“This is the beginning of gaming’s further ascent into the cultural zeitgeist,” he added.

The $176 billion video game industry exploded during the pandemic, although some worry sales may slow as the pandemic eases. E-sports is expected to become a billion-dollar business this year; already, the e-sports team Evil Geniuses received an investment from China’s Fosun Sports Group that valued it at more than $250 million.


Frances Haugen, a former Facebook manager, delivers testimony to Britain’s Parliament in a campaign to build stronger oversight of the social media giant.CreditCredit…T.J. Kirkpatrick for The New York Times

LONDON — Frances Haugen, the former Facebook product manager-turned-whistle-blower, appeared before British lawmakers on Monday, painting a portrait of a company vividly aware of its harmful effects on society but unwilling to act because doing so could jeopardize profits and growth.

Ms. Haugen’s more than two hours of testimony before the British Parliament was the latest step in her tightly choreographed campaign to build a case for stiffer oversight of the social media giant. Hours before she began speaking in London, more than a dozen news organizations published articles based on the Facebook Papers, a cache of documents she took before resigning from the company.

In the coming weeks, Ms. Haugen is scheduled to meet with officials in France, Germany and the European Union about new laws that she says are necessary to force Facebook to recalibrate how it measures success more toward the public good.

“We need regulation,” Ms. Haugen said on Tuesday. “Until the incentives change, Facebook will not change,” she added later.

Even for Facebook, a company that has lurched from controversy to controversy since Mark Zuckerberg started it as a Harvard undergrad in 2004, Ms. Haugen’s disclosures have created a backlash that stands apart.

The revelations have generated increased political support for new regulation in the United States and Europe, including some calls for Mr. Zuckerberg to step aside as Facebook’s chief executive, putting Facebook on the defensive. The growing rancor could lead to new government investigations and force the company to disclose more details about how its software works.

“Facebook is failing to prevent harm to children, it’s failing to stop the spread of disinformation, it is failing to stop the spread of hate speech,” John Nicolson, a lawmaker from Scotland, said during the hearing. “It does have the power to deal with these issues, it’s just choosing not to.”

Ms. Haugen left Facebook with scores of internal research, slide decks, discussion threads, presentations and memos that she has shared with lawmakers, regulators and journalists. The information provides an unvarnished view of how some within the company tried to raise alarms about its harmful effects, but often struggled to get Facebook leaders to act.

Facebook defended its practices and said it had spent $13 billion and hired 40,000 people to work on safety issues.

“Contrary to what was discussed at the hearing, we’ve always had the commercial incentive to remove harmful content from our sites,” said Mitch Henderson, a company spokesman. “People don’t want to see it when they use our apps and advertisers don’t want their ads next to it.”

After leaking internal company documents to The Wall Street Journal that resulted in a series of articles that began in September, she revealed her identify this month for an episode on “60 Minutes” and testified before a Senate committee. She also shared the documents the Securities and Exchange Commission.

Since then, she has shared the Facebook materials with other news organizations, including The New York Times, resulting in additional stories about Facebook’s harmful effects, including its role in spreading election misinformation in the United States and stoking divisions in countries such as India.

Ms. Haugen’s visit to Europe is a reflection of the region’s aggressive approach to tech regulation and a belief that its policymakers are expected to act faster than the United States to pass new laws aiming at Facebook and other tech giants.

“For all the problems Frances Haugen is trying to solve, Europe is the place to be,” said Mathias Vermeulen, the public policy director at AWO, a law firm and policy firm that is among the groups working with Ms. Haugen in the United States and Europe.

In London, Ms. Haugen told policymakers that regulation could offset Facebook’s corporate culture that rewards ideas that get people to spend more time scrolling their social media feeds, but views safety issues as a less important “cost center.”

Facebook’s influence is particularly bad in areas of Africa, Asia and the Middle East where its services are widely popular but the company does not have language or cultural expertise, Ms. Haugen said. Without government intervention, she told lawmakers, events in countries such as Ethiopia and Myanmar, where Facebook has been accused of contributing to ethnic violence, are the “opening chapters of a novel that is going to be horrific to read.”

She suggested policies that would require Facebook to perform annual risk assessments to identify areas where its product were causing harm — such as the spread of coronavirus misinformation, or harms to teenagers’ mental health. She said Facebook could be required to outline specific solutions and share the findings with outside researchers and auditors to be sure they are sufficient.

Without government-mandated transparency, Facebook can present a false picture of its efforts to address hate speech and other extreme content, she said. The company says artificial intelligence software catches more than 90 percent of hate speech, but Ms. Haugen said the number was less than 5 percent.

“They are very good at dancing with data,” she said.

British policymakers are drafting a law to create a new internet regulator that could impose billions of dollars worth of fines if more isn’t done to stop the spread of hate speech, misinformation, racist abuse and harmful content targeting children.

The policy ideas gained additional momentum after the murder this month of David Amess, a member of Parliament, leading to calls for the law to force social media companies to crack down on extremism.

In Brussels, Ms. Haugen is scheduled to meet on Nov. 8 with European Union officials drafting laws that would force Facebook and other large internet platforms to disclose more about how their recommendation algorithms choose to promote certain material over others, and impose tougher antitrust rules to prevent the companies from using their dominant positions to box out smaller rivals. European policymakers are also debating a ban on targeted advertising based on a person’s data profile, which would pose a grave threat to Facebook’s multibillion-dollar advertising business.

Despite growing political support for new regulation, many questions remain about how such policies would work in practice. Any new laws in Britain and the European Union are not expected to be passed until next year at the earliest. In the United States, lawmakers are focusing on the harmful effect of Facebook and other social media platforms have on children.

Regulating Facebook is particularly complex because many of its biggest problems center on content posted by users all over the world, raising difficult questions about the regulation of speech and free expression. In Britain, the new online safety law has been criticized by some civil society groups as being overly restrictive and a threat to free speech online.

Another challenge is how to enforce the new rules, particularly at a time when many government agencies are under pressure to tighten spending.

By The New York Times

For weeks, Facebook has been shaken by revelations that have ignited a firestorm of criticism from lawmakers, regulators and the public.

Reports by The Wall Street Journal from research documents provided by a whistle-blower put Facebook under a microscope. Those reports showed how Facebook knew Instagram was worsening body image issues among teenagers, among other issues.

The whistle-blower, Frances Haugen, went public during an interview on “60 Minutes” in early October. On Oct. 5, Ms. Haugen testified before a Senate subcommittee for more than three hours. She said Facebook had purposely hidden disturbing research about how teenagers felt worse about themselves after using its products and how it was willing to use hateful content on its site to keep users coming back. In her testimony, she encouraged lawmakers to demand more documents and internal research, suggesting the documents she had provided were just the tip of the iceberg.

After Ms. Haugen testified, executives publicly questioned her credibility and called her accusations untrue. But internally, they tried to position their stances to hang on to the good will of more than 63,000 employees and assuage their concerns.

Reporters have since covered more internal documents from the company, which owns Instagram and WhatsApp in addition to the core Facebook social network. Documents about Instagram, for instance, reveal a company that is struggling with retaining, engaging and attracting young users.

Other documents raise questions about Facebook’s role in election misinformation and the pro-Trump attack on the Capitol on Jan. 6. Company documents show the degree to which Facebook knew of extremist movements and groups on its site that were trying to polarize American voters before the election. Employees believed Facebook could have done more, according to the documents.

In India, Facebook’s biggest market, the problems are bigger, too. Internal documents show a struggle with misinformation, hate speech and celebrations of violence. Dozens of studies and memos written by Facebook employees provide stark evidence of one of the most serious criticisms levied by human rights activists and politicians against the world-spanning company: It moves into a country without fully understanding its potential impact on local culture and politics, and fails to deploy the resources to act on issues once they occur.

The latest revelations, published on Monday morning, show internal research that undercuts the heart of social networking — “likes” and sharing — that Facebook revolutionized. According to the documents, researchers determined over and over that people misused key features or that those features amplified toxic content, among other effects. In an August 2019 internal memo, several researchers said it was Facebook’s “core product mechanics” — meaning the basics of how the product functioned — that had let misinformation and hate speech flourish on the site.

Without government-mandated transparency, Facebook can present a false picture of its efforts to address hate speech and other extreme content,Ms. Haugen told Britain’s Parliament. The company says artificial intelligence software catches more than 90 percent of hate speech, but Ms. Haugen said the number was less than 5 percent.

“They are very good at dancing with data,” she said.

The image on the left loads normally, but the same image on the right takes eight times longer to load, simulating what a Twitter user in Russia would experience with the government’s technology in use.

Russia is putting in place perhaps the world’s most ambitious digital censorship effort outside China. It is using the censorship technology to gain more leverage over Western internet companies in addition to other strong-arm tactics and legal intimidation.

The world got its first glimpse of Russia’s new tools in action when Twitter was slowed to a crawl in the country this spring. It was the first time the filtering system had been put to work, researchers and activists said. Other sites have since been blocked, including several linked to the jailed opposition leader Alexei A. Navalny. READ THE ARTICLE ->

Stocks on Wall Street rose in midday trading Monday ahead of the release of a string of Big Tech earnings reports this week. The S&P 500 was up 0.5 percent and heading for a record close, while the Nasdaq composite ticked up 0.9 percent.

Tesla led the gains in the S&P 500, gaining more than 10 percent after Hertz, the car rental agency, said on Monday that it had placed an order for 100,000 Teslas. The rally put Tesla on track to end the day with a market value of above $1 trillion for the first time — a milestone only reached by a handful of other publicly traded companies.

Facebook was slightly higher ahead of its earnings report due after the close of trading on Monday. The release comes the same day as Frances Haugen, a former Facebook employee who has leaked internal Facebook research, testified before Britain’s Parliament as part of her campaign to attract political support for new regulation in the United States and Europe.

Microsoft, Twitter and Alphabet will release their quarterly reports on Tuesday. Amazon and Apple will release their financial performance reports on Thursday.

PayPal rose 4.1 percent in midday trading after the digital payments giant said on Sunday that it was not interested in buying the social media network Pinterest. Shares of Pinterest fell about 12 percent. Last week, shares of PayPal dropped after reports that it offered to buy Pinterest in a deal that valued the site at $45 billion.

Economists are also watching the development of President Biden’s infrastructure and social spending plans. To pay for the package, billionaires could be taxed on unrealized capital gains on their liquid assets, including stocks and real estate, Democratic officials said on Sunday. The move comes amid a dispute to raise the corporate tax rate to 28 percent from 21 percent.

Frances Haugen, a former Facebook employee turned whistle-blower, will testify in Britain. She appeared before senators on Oct. 5.Credit…T.J. Kirkpatrick for The New York Times


Facebook earnings: The company is set to publish its financial performance report for the three months that ended in September. Investors are looking for any signs that recent privacy changes in Apple’s iOS mobile operating system, preventing tracking by some advertisers, hurt Facebook’s ad business.

Facebook whistle-blower: Frances Haugen, who once worked at Facebook, is expected to testify before the British Parliament. The testimony opens her European tour to meet with policymakers pushing for tougher regulation of Silicon Valley giants. Ms. Haugen is scheduled to visit Paris, Berlin and Brussels.


Twitter earnings: Investors will look for any clues about whether Twitter will miss revenue expectations because of Apple’s privacy changes. Twitter’s shares slumped after Snap, the parent company of Snapchat, reported lower-than-expected revenue on Thursday.

Google earnings: Alphabet, Google’s parent company, will report its financials for its third quarter. In July, the company reported a profit of $18.5 billion for the second quarter, more than it made in all of 2015.


Boeing earnings: Investors will be looking for an update on how quickly Boeing can resolve production issues with the 787 Dreamliner and start delivering the wide-body jet. The company announced in July that it would temporarily slow production of the model after identifying new work that needed to be done.

Auto earnings: Ford Motor and General Motors will report their financials for the most recent quarter. Investors will be looking at how a global chip shortage affected both companies’ profits. Ford has already reported that sales of new vehicles in the United States fell about 27 percent in the three months that ended in September.


G.D.P.: The Commerce Department will publish data on gross domestic product in the United States. Economists will look for evidence that supply-chain disruptions and labor shortages are constraining the recovery and prompting inflation.

Amazon earnings: Investors will be looking for whether Amazon’s sales continued to decelerate as businesses opened in the three months that ended in September.

Apple earnings: The company will report its financial performance for its fourth quarter, and investors will be watching for the effects that supply chain snarls have had on Apple’s production ahead of the holiday season.

E.C.B. meeting: Christine Lagarde, the European Central Bank’s president, may offer some insight on when the bank will scale back its bond-purchase programs. Officials are also expected to provide their outlook on inflation.


Oil earnings: Investors will find out whether Exxon Mobil and Chevron benefited from a global energy crunch that pushed oil prices up to seven-year highs. The report captures the period when Hurricane Ida damaged oil platforms and infrastructure in the Gulf of Mexico in late August.

When will the shortages end? Why are new cars so hard to find? What happened to all the giant container ships?

In an era in which we’ve become accustomed to clicking and waiting for whatever we desire to arrive at our doors, we have experienced the shock of not being able to buy toilet paper, having to wait months for curtains and needing to compromise on the color of our new cars. The pandemic ushered in many of the problems the world now faces, but the end of the pandemic will not instantly fix things.

We answer the questions above and more with a look at the global supply chain. READ THE ARTICLE ->

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