News that UK-based used car seller Cazoo intends to list in the United States via a SPAC is not surprising. After all, the SPAC boom we’ve seen in recent quarters means that there are a host of American blank-check companies in the market looking for deals — why would they stop at domestic borders?

But the Cazoo deal is not a surprise for other reasons as well. We’ve seen the value of related American company Carvana spike in recent years after its 2017 IPO, for example. And Carvana has shown the sort of gross-margin improvement that Cazoo intends to manage in the coming years, so there’s precedent for its sales model to show economic improvements over time..

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But coming at the same time as a sunny investor deck detailing why the Cazoo-AJAX I deal is a good idea are a number of public-market trembles that could indicate uncertain risk tolerance among public investors. We can see this in the slack debut of several Chinese companies, as well as the downward pressure on the public offering for Deliveroo, a food-delivery platform.

Is the public market’s enthusiasm for tech listings slowing? If so, it would be bad news for companies that have announced SPAC-led debuts, firms like Latch that priced their combination during a particular market climate. One that won’t match well to a risk-off environment, if that’s where things head.

This morning, let’s parse the Cazoo deck briefly and then ask ourselves what the market tea leaves are telling us about investor appetite for risky shares.

Cazoo

After reading the Cazoo and Deliveroo news this morning, I have to ask if there’s something particularly British about companies ending in -oo. Let me know.

Regardless, the Cazoo investor deck for its SPAC deal is here. Follow along if you want. We’re starting on page 33, where the company discloses its 2020 results and forecasts the next several:

Via Cazoo’s investor deck.

As the Ubers of the world continue to scale, a smaller on-demand transportation startup has raised some funding in Germany, underscoring the opportunities that remain for startups in the space targeting specific service niches. Blacklane — the Berlin startup that provides on-demand black-car chauffeur services in Berlin, London, Dubai, Los Angeles, New York, Paris, Singapore and 16 other cities — has closed a round of €22 million ($26 million at current rates). After taking a majority stake in Havn, the Jaguar-hatched electric car service in London, in February, Blacklen said that it will be using this latest round of funding to continue expanding sustainable travel initiatives, and to continue expanding its existing business with more flexible options for riding.

The funding, which is being made at an upround valuation, is a sign of how the company is showing signs of growth after a year in which monthly revenues dropped 99% in the wake of the Covid-19 pandemic and the resulting drop in travel, and specifically people willing to be in small spaces that are shared with others.

“The global travel and mobility industries have suffered, with several players struggling between drastic cuts, hibernation or ceasing operations. Blacklane has taken the opportunity to cater to travelers’ emerging needs,” said Dr. Jens Wohltorf, CEO and co-founder of Blacklane, in a statement. “Thanks to this financing, we will continue to fast-track our innovation, with zero layoffs.”

The company said that the investment is coming from existing investors German automotive giant Daimler, the UAE’s ALFAHIM Group and btov Partners. And while it is coming at an upround, Blacklane is not disclosing any figures, nor has it ever disclosed valuation. Previous backers of the company also include the strategic investment arm of Recruit Holdings, the Japanese HR giant, and it has raised around $100 million to date, including a round of about $45 million in 2018.

The funding is coming after what has been an extremely rough year for travel and transportation startups due to the Covid-19 pandemic, with Blacklane itself seeing monthly revenues drop 99% after the pandemic hit last year, the company tells me.

Some others in the space that diversified into other areas like food delivery or other kinds of transport (eg, bikes or scooters) were able to offset declines in their more core ride-hailing services, which in the meantime were repositioned as a safer alternative to public transportation. Blacklane, however, had never positioned itself as a ride for “everyman” — its core use case were higher-end rides and airport trips (which had also died a death) — so when movement shut down, so Blacklane’s business nosedived.

It was particularly bad timing for Blacklane, considering that in the lead up to the pandemic, it looked to be on course to turn a profit on its focused model.

The reason that Blacklane has managed to raise at an upround tells another side of the story, however.

As companies in transport and travel gingerly started to show the smaller signs of recovery last summer, so too did Blacklane. It coupled that with the first steps of diversification itself.

Earlier this month, it added “chauffeur hailing” in 22 cities, an on-demand service that reduced the lead time for an order to under 30 minutes (its previous service was based on more advanced bookings). It also changed its pricing structure to get more competitive on shorter distances, since so many of the airport rides that were the basis of its revenues have yet to return.

In addition to that, Blacklane took a majority stake in Havn, an electric-based car service hatched by Jaguar, for an undisclosed sum, to spearhead a move into more sustainable travel options alongside the fleet of Teslas already operated by Blacklane.

“Worldwide travel restrictions give us a one-time chance to reset our expectations for safe and sustainable trips,” said Wohltorf in a statement. “Blacklane will recover responsibly and continue to grow while caring for both people and the planet.”

SpaceX has completed what’s known as the ‘stacking’ of its first Super Heavy prototype, the extremely large next-generation first-stage rocket booster that it will eventually use to propel its Starship spacecraft to orbit and beyond. The Super Heavy Booster is about 220 feet tall – which is roughly the wingspan of a Boeing 747, or a bit taller than the Cinderella Castle at Walt Disney World in Florida.

That’s without Starship on top, which will add around another 160 feet. Super Heavy will undergo its own testing prior to flying with Starship, however, and a lot of that will be focused on assuring its fuel tanks can handle the pressurization and extreme temperatures required for keeping all that ignitable material stable prior to when the engines actually fire.

Super Heavy uses the same engines as Starship — Raptor engines, to be specific, which SpaceX created new for this generation of launch vehicle. The final version will have a total of 28 Raptor engines, but this first prototype will likely be outfitted with far fewer, and SpaceX CEO Elon Musk has confirmed that it’ll also remain grounded, as it’s intended to be use only for testing things like build and transportation mechanics.

He did say the next prototype will fly, and while he isn’t always accurate about timelines, the Starship upper stage (i.e., the one that looks like a big grain silo with fins) is progressing quickly in its development, including with a recent test flight that ended with a near-perfect landing — minus the subsequent explosion that took out the prototype rocket entirely a few minutes after it had touched down successfully.

Musk clearly wants to move fast with Starship and Super Heavy, in part because of ambitious goals it has of serving as a provider to NASA for future human lunar landing missions as part of the Artemis program, and also because it’s still planning to fly the first commercial tourist flight of a Starship in just two short years in 2023.

Bolt, an Uber competitor that is building an international on-demand network of services to transport people, food and other items in cars, scooters and bikes across Europe and Africa, has picked up some strategic funding today to continue expanding its business in emerging markets.

The International Finance Corporation, a division of the World Bank, is investing €20 million ($24 million) in the Tallinn, Estonia-based startup to open up more services across Eastern Europe and Africa, with a specific mention of more services in Ukraine and Nigeria, two of those regions’ biggest economies, and more innovative services to target demographic groups that might be under-represented or under-served, such as women. 

Funding from the IFC is a significant endorsement of a company, if at the same time a relatively small amount compared to Bolt’s wider fundraising efforts.

Most recently, it raised $182 million in December at a significant hike to its previous valuation (which had been $1.9 billion). A Bolt spokesperson tells us that, once again, “our valuation has grown with the latest funding round, but we’re not disclosing the updated number.” (For the record, in December we calculated that the valuaton was probably around $4.3 billion, based on a 1.5x multiple on GMV of €3.5 billion, figures provided to us by CEO and co-founder Markus Villig. That figure wasn’t disputed, nor confirmed, though.)

People may not consider the IFC in the same breath as more typical VCs like SoftBank, Sequoia, Index Ventures, or Andreessen Horowitz, but it’s a significant player when it comes to backing startups around the world. Last year alone it invested $22 billion in companies, it said.

Backing a transportation startup is a notable move for it, considering that a lot of the IFC’s interest in tech has typically been around financial services. For example, it has also invested money into CurrencyCloud, Remitly, CompareAsiaGroup, and Kreditech, among others.

But improving transportation is another development target — in particular when you consider that companies like Bolt are built like marketplaces that provide income to people, infrastructure to businesses (in the form of delivery), on top of its most obvious service helping consumers get around.

“We are looking forward to partnering with IFC to further support entrepreneurship, empower women and increase access to affordable mobility services in Africa and Eastern Europe,” said Villig, in a statement. “Together with the investment from the European Investment Bank last year, we are proud to have sizable and strategically important institutions backing us and recognizing the strategic value Bolt is providing to emerging economies”.

Bolt’s efforts in emerging markets have long been one the key ways that the company differentiates itself from Uber — perhaps logical, considering that the company itself was founded in an emerging economy. Since launching in 2013, it has picked up over 50 million customers and more than 1.5 million drivers in 40 countries, including 400,000 drivers in 70 cities on the African continent.

That strategy has also grown over time to include services for under-represented groups in these under-represented markets. Bolt is piloting a “Women Only” ride-hailing service in South Africa, with female drivers and passengers to improve job opportunities and general safety, one of the programs that the IFC funding will support, it said.

“Technology can and should unlock new pathways for sustainable development and women’s empowerment,” said Stephanie von Friedeburg, IFC Senior Vice President of Operations, in a statement. “Our investment in Bolt aims to help tap into technology to disrupt the transport sector in a way that is good for the environment, creates more flexible work opportunities for women, and provides safer and more affordable transportation access in emerging markets.”

Commitments to carbon neutrality keep coming from all corners of the business world — over the past few weeks, companies ranging from the fast-casual restaurant chain Sweetgreen to the security-focused networking IT company Palo Alto Networks to the online craft retailer Etsy committed to net-zero carbon emission plans.

As the companies look for ways to reduce their energy consumption, they’re turning to carbon offset programs as a stopgap measure until the energy grid decarbonizes, they implement technologies to reduce their energy consumption, or both.

This push toward corporate sustainability is creating all kinds of strange bedfellows and startup opportunities, with major corporate offset programs and the establishment of new startups focused on offsets creating channels for sustainable technologies to get to market.

The latest example of a company leveraging a sustainability angle to tie a corporate partner even closer to their business is the agreement between Delta and Deloitte, which involves the accounting and consulting firm paying Delta for renewable jet fuel to offset the emissions of its corporate travel.

To be clear, a better policy for Deloitte would be to cut back on non-essential travel significantly and focus on doing as much remote work as possible to reduce the need for flights. But in some cases business travel is unavoidable, and most folks want to get back to a pre-pandemic normal, which — at least in the U.S. and other countries — will include significantly ramping up air travel for a percentage of the population.

As the BBC noted, air travel accounts for roughly 5 percent of the emissions that contribute to global climate change, but only a small percentage of the world actually uses air transport. According to one analysis from the International Council on Clean Transport, just 3 percent of the world’s population flies regularly. And if everyone in the world did fly, aircraft emissions would top the CO2 emissions of the entire U.S.

Which brings us back to Deloitte and Delta and startups.

Delta’s deal to buy sustainable aviation fuel that would offset a portion of the carbon emissions associated with Deloitte’s business travel is one small step toward greening the airline industry, but the question is whether it’s a significant first step or just an attempt to greenwash the unsustainable travel habits of a consulting industry that prides itself on such perks.

3D-printed rocket company Relativity Space has just revealed what comes after Terran 1, the small launch vehicle it hopes to begin flying later this year. It’s next rocket will be Terran R, a much larger orbital rocket with around 20x the cargo capacity of Terran 1, that will also be distinguished from its smaller, disposable sibling by being fully reusable – across both first and second-stages, unlike SpaceX’s Falcon 9.

I spoke to Relativity Space CEO and founder Tim Ellis about Terran R, and how long it’s been in the works for the space startup. Ellis said that in fact, the vision every since Relativity’s time at Y Combinator has included larger lift rockets – and much more.

“When I founded Relativity five years ago, it always was inspired by seeing SpaceX launching and landing rockets, docking with the International Space Station, and this idea that going to Mars was critically important for humanity’s future, and really expanding the possibilities for human experience, on Earth and beyond,” Ellis told me. “But that all of the animations faded to black right when people walked out [of spaceship landing on Mars], and I believed that 3D printing had to be this inevitable technology that was going to build humanity’s industrial base on Mars, and that we needed to really inspire dozens, or even hundreds of companies to work on making this future happen.”

The long-term goal for Relativity Space, Ellis said, has always been to become an “end-product 3D printing company,” with its original Terran 1 light payload rocket simply representing the first of those products it’s bringing to market.

“3D printing is our new tech stack for aerospace, and really is rewriting something that we don’t feel has fundamentally changed over the last 60 years,” he said. “It’s really bringing automation that replaces the factory fixed tooling, supply chains, hundreds of thousands of parts, manual labor and slow iteration speed, with something that I believe is needed for the future on Earth, too.”

Terran R, which will have a payload capacity of over 20,000 kg (more than 44,000 lbs) to low-Earth orbit, is simply “the next logical step” for Relativity in that long-term vision of producing a wide range of products, including aerospace equipment for use right here on Earth. Ellis says that a larger launch vehicle makes sense given current strong customer demand for Terran 1, which has a max payload capacity of 1,250 kg (around 2,755 lbs) to low-Earth orbit, combined with the average size of satellites being launched today. Despite the boon in so-called ‘small’ satellites, many of the constellations being build today have individual satellites that weigh in excess of 500 kilograms (1,100 lbs), Ellis points out, which means that Terran R will be able to delivery many more at once for these growing on-orbit spacecraft networks.

A test fire of the new engine that Terran R will use for higher thrust capabilities.

“It’s really the same rocket architecture, it’s the same propellant, same factory, it’s the same printers, the same avionics and the same team that developed Terran 1,” Ellis said about the forthcoming rocket. That means that it’s actually relatively easy for the company to spin up its new production line, despite Terran R actually being quite functionally different than the current, smaller rocket – particularly when it comes to its full reusability.

As mentioned, Terran R will have both a reusable first and second stage. SpaceX’s Falcon 9’s first stage (a liquid fuel rocket booster) is reusable, and detaches from the second stage before quickly re-orienting itself and re-entering Earth’s atmosphere for a propulsive landing just after entering space. The Falcon 9 second stage is expendable, which is the space term for essentially just junk that’s discarded and eventually de-orbits and burns up on re-entry.

SpaceX had planned to try to make the Falcon 9 second stage reusable, but it would’ve required too much additional mass via heat shielding for it to make sense with the economics it was targeting. Ellis was light on details about Terran R’s specifics, but he did hint that some unique use of fairly unusual materials made possible though 3D printing, along with some sparing use of generative design, will be at work in helping the Relativity rocket’s second stage reusable in a sustainable way.

“Because it’s still entirely 3D-printed, we’re actually going to use more exotic materials, and design geometries that wouldn’t be possible at all, traditionally, to manufacture,” Ellis said. “It’s just too complicated looking; it would be way too difficult to manufacture traditionally in the ways that that Terran R is designed. And that will actually make it a much more reusable rocket, and really helped build the best reusable rocket possible.”

Terran R will also use a new upper stage engine that Relativity Space is designing, which is also unique compared to the existing engines used on Terran 1. It’s 3D printed as well, but uses a copper thrust chamber that will allow it to have higher overall power and thrust capabilities, according to Ellis. When I spoke to Ellis on Thursday evening, Relativity had just completed its first full success duration test of the new engine, a key step towards full production.

Ellis said that the company will share more about Terran R over the course of this year, but did note that the existing large 3D printers in its production facilities are already sized correctly to start building the new rocket – “the only change is software,” he said. He also added that some of the test sites Relativity has contracted to use at NASA’s Stennis Space Center are able to support testing of a rocket at Terran R’s scale, too, so it sounds like he’s planning for rapid progress on this new launch vehicle.

Uber has been accused of downplaying its influence over working conditions in the gig economy after the ride-hailing giant published a white paper earlier this week in which it lobbied for a ‘Prop 22’ style deregulation of Europe’s labor laws.

Fairwork, an academic research project that benchmarks gig platforms against a set of fairness principles to  encourage these intermediaries to improve conditions for workers, said today that Uber’s call for special rules for the gig economy is an attempt to “legitimize a lower level of protection for platform workers than most European workers benefit from.”

“Uber asserts that it recognizes the need for improved conditions but is dependent on regulatory change to realize that goal. The company’s recognition of dissatisfaction among drivers is commendable. However, it is already well within their locus of control to address this dissatisfaction and improve conditions for its drivers under existing legal frameworks,” the platform work research group wrote in a response to Uber’s ‘Better Deal‘ white paper. 

“Uber’s focus on policy change, furthermore, downplays the company’s significant influence over conditions in the gig economy. By calling for new regulations, the company is shifting responsibility for workers’ conditions to other actors, when it could step up to the plate and provide an exemplar of how a platform can treat its workers.” 

“Whilst we applaud Uber’s awareness of the need for change, we urge them to live up to their call,” Fairwork added. “The company has long set the blueprint for the gig economy, and, perhaps more than any other actor, is positioned to enact immediate change to improve the lives of their workers under current legal frameworks.“

Fairwork noted that Uber has repeatedly fallen short of its (independent) benchmarks of ‘fair’ platform work. (NB: We covered the start of its initiative here back in 2019).

As we reported earlier this week, Uber is pushing for a ‘Prop 22’-style outcome in Europe, following its win in California last year when it convinced voters to exempt delivery and transport platform workers from employment classification laws — and as regional lawmakers are actively looking at how to improve the lot of gig workers.

In the white paper Uber has fired at EU lawmakers it argues that conditions for gig workers can only improve if regulators grant platforms a carve out from labor laws — lobbying for what it dubbed a “new standard” for gig work. However Fairwork argues this a blatant attempt to water down European employment standards, as Uber seeks to apply the same playbook it successfully deployed to reconfigure Californian legislation in its business interests.

Yet Europe is not California. And as Fairwork points out courts across the region have begun to roll back self-serving classifications of gig workers as ‘self-employed’ — with a number of these challenges going against Uber in recent years.

A major verdict is also looming for Uber Friday when the UK Supreme Court is expected to give the last word on an employment tribunal which it has been losing since 2016.

“The white paper reproduces the strategy taken by Uber in California where, after the state introduced new regulation that would have extended employee benefits to platform workers, they and several other prominent platforms successfully pushed for a watered-down alternative,” said Fairwork, noting that platforms (Uber and Lyft) spent some $200M persuading voters in California to back their ballot measure (“which exempted delivery and transport platform workers from classification laws in exchange for stripped-back versions of workplace benefits that have already been shown to be inadequate”, as the group tells it). 

“It is no surprise to see the company extending this strategy to Europe shortly in advance of a February 19 ruling in a UK Supreme Court case challenging the classification of drivers and the European Commission’s consultation with workers and employer representatives to inform gig economy regulation on February 24,” Fairwork also said, calling for regional lawmakers to engage with a process to strengthen and expand existing labor protections rather than get on board with Uber’s drive to lower European standards. 

“All workers, regardless of how their work is arranged, deserve decent wages and safe working conditions. Labour law provides these basic rights; and work arranged via a platform does not require a radical new approach. The benefits proposed in Uber’s white paper, like those provided under Proposition 22, represent weakened versions of those afforded to employees,” it added.

“We need to strengthen and expand existing labour protections in order to improve conditions, not create additional exclusions and exemptions that leave millions behind.” 

We’ve reached out to Uber for any comment.

The European Commission has yet to decide what kind of regulatory intervention it might make as regards gig work. But it has signalled an intention to do something in this area — and that’s likely been accelerated by the COVID-19 pandemic spotlighting the individual and public health risks when gig workers lack employment protections like sick pay.

In a 2019 mission letter, the EU president told the incoming jobs commissioner to look at ways to improve the lot of platform workers, writing that: “Dignified, transparent and predictable working conditions are essential to our economic model.”

Uber and Lyft lost a lot of money in 2020. That’s not a surprise, as COVID-19 caused many ride-hailing markets to freeze, limiting demand for folks moving around. To combat the declines in their traditional businesses, Uber continued its push into consumer delivery, while Lyft announced a push into business-to-business logistics.

But the decline in demand harmed both companies. We can see that in their full-year numbers. Uber’s revenue fell from $13.0 billion in 2019 to $11.1 billion in 2020. Lyft’s fell from $3.6 billion in 2019 to a far-smaller $2.4 billion in 2020.

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But Uber and Lyft are excited that they will reach adjusted profitability, measured as earnings before interest, taxes, depreciation, amortization, and even more stuff stripped out, by the fourth quarter of this year.

Ride-hailing profits have long felt similar to self-driving revenues: just a bit over the horizon. But after the year from hell, Uber and Lyft are pretty damn certain that their highly-adjusted profit dreams are going to come through.

This morning, let’s unpack their latest numbers to see if what the two companies are dangling in front of investors is worth desiring. Along the way we’ll talk BS metrics and how firing a lot of people can cut your cost base.

Uber

Using normal accounting rules, Uber lost $6.77 billion in 2020, an improvement from its 2019 loss of $8.51 billion. However, if you lean on Uber’s definition of adjusted EBITDA, its 2019 and 2020 losses fall to $2.73 billion and $2.53 billion, respectively.

So what is this magic wand Uber is waving to make billions of dollars worth of red ink go away? Let’s hear from the company itself:

We define Adjusted EBITDA as net income (loss), excluding (i) income (loss) from discontinued operations, net of income taxes, (ii) net income (loss) attributable to non-controlling interests, net of tax, (iii) provision for (benefit from) income taxes, (iv) income (loss) from equity method investments, (v) interest expense, (vi) other income (expense), net, (vii) depreciation and amortization, (viii) stock-based compensation expense, (ix) certain legal, tax, and regulatory reserve changes and settlements, (x) goodwill and asset impairments/loss on sale of assets, (xi) acquisition and financing related expenses, (xii) restructuring and related charges and (xiii) other items not indicative of our ongoing operating performance, including COVID-19 response initiative related payments for financial assistance to Drivers personally impacted by COVID-19, the cost of personal protective equipment distributed to Drivers, Driver reimbursement for their cost of purchasing personal protective equipment, the costs related to free rides and food deliveries to healthcare workers, seniors, and others in need as well as charitable donations.

Er, hot damn. I can’t recall ever seeing an adjusted EBITDA definition with twelve different categories of exclusion. But, it’s what Uber is focused on as reaching positive adjusted EBITDA is key to its current pitch to investors.

Indeed, here’s the company’s CFO in its most recent earnings call, discussing its recent performance:

We remain on track to turn the EBITDA profitable in 2021, and we are confident that Uber can deliver sustained strong top-line growth as we move past the pandemic.

So, if investors get what Uber promises, they will get an unprofitable company at the end of 2021, albeit one that, if you strip out a dozen categories of expense, is no longer running in the red. This, from a company worth north of $112 billion, feels like a very small promise.

And yet Uber shares have quadrupled from their pandemic lows, during which they fell under the $15 mark. Today Uber is worth more than $60 per share, despite shrinking last year and projecting years of losses (real), and possible some (fake) profits later in the year.

Rocket launch company Astra, which just reached space this past December with a test launch from Alaska, will be going public on the NASDAQ via a merger with a special purpose acquisition company (SPAC) called Holicity. The recent SPAC craze has already extended to the New Space sector, and Virgin Galactic was among the in this wave of a new path to public listing, so there is precedent for space launch in particular, but Astra will be the first to list on the NASDAQ.

The terms of the deal will result in an anticipated $500 million in cash for Astra, from a combined $300 million held by Holicity in trust and a $300 million injection via a PIPE (private investment in public equity) from funds under management by BlackRock. The arrangement sets a pro forma enterprise valuation of Astra at around $2.1 billion – that valuation of the company minus the $500 million in cash the SPAC merger brings in. Astra expects it to complete by the second quarter of this year, after which the company will trade under the ticker ‘ASTR.’

Astra manufactures its own rockets, which are designed to carry small orbital payloads, at a facility in Alameda, California. Thus far, it has then shipped its launch vehicles to Kodiak, Alaska for flight – requiring just a handful of people on the ground at the actual spaceport to mount and launch the rocket, with the majority of the team overseeing the flight operating remotely out of a mission control facility back in California. The company’s model focuses on high output production of relatively inexpensive rockets, which can be responsively shipped and launched virtually anywhere depending on needs.

With its successful test in December, Astra achieved a pay-off of years of quiet work building and iterating its launch model. The startup was originally pursuing a DARPA-funded competition to achieve rapid response launch capabilities, but that contest expired with the prize unclaimed. The successful test in December still proved out the viability of Astra’s model – though it fell slightly short of achieving orbital velocity for actual payload delivery. The company said that this was a relatively easy remaining issue to fix, wholly manageable via software tweaks, and it intends to deliver its first commercial satellites beginning this summer.

Ultimately, Astra aims to be launching payloads on a daily cadency by 2025, and in a blog post accompanying the SPAC news, Astra founder and CEO Chris Kemp said that it’s also intent on “building a platform of space services” that implies ambitions beyond its work today on rockets.

Tesla CEO Elon Musk said on the company’s 2020 Q4 earnings call that all engineering work is now complete on the Tesla Semi, the freight-hauling semi truck that the company is building with an all-electric powertrain. The company expects to begin deliveries of Tesla Semi this year, the company said in its Q4 earnings release, and Musk said the only thing limiting their ability to produce them now is the availability of battery cells.

“The main reason we have not accelerated new products – like for example Tesla Semi – is that we simply don’t have enough cells for it,” Musk said. “If we were to make the Semi right now, and we could easily go into production with the Semi right now, but we would not have enough cells for it.”

Musk added that the company does expect to have sufficient cell volume to meet its needs once it goes into production on its 4680 battery pack, which is a new custom cell design it created with a so-called ‘tables’ design that allows for greater energy density and therefore range.

“A Semi would use typically five times the number of cells that a car would use, but it would not sell for five times what a car would sell for, so it kind of would not make sense for us to do the Semi right now,” Musk said. “But it will absolutely make sense for us to do it as soon as we can address the cell production constraint.”

That constraint points to the same conclusion for the possibility of Tesla developing a van, Musk added, and the lifting of the constraint will likewise make it possible for Tesla to pursue the development of that category of vehicle, he said.

Tesla has big plans for “exponentially” ramping cell production, with a goal of having production capacity infrastructure in place for a Toal of 200 gigawatt hours per year by 2022, and a target of being able to actually produce around 40% of that by that year (with future process improvements generating additional gigawatt hours of cell capacity  in gradual improvements thereafter).

Tesla is open to licensing its software, including its Autopilot highly-automated driving technology, and the neural network training it has built to improve its autonomous driving technology. Tesla CEO Elon Musk revealed those considerations on the company’s Q4 earnings call on Wednesday, adding that the company has in fact already “had some preliminary discussions about licensing Autopilot to other OEMs.”

The company began rolling out its beta version of the so-called ‘full self-driving’ or FSD version of Autopilot late last year. The standard Autopilot features available in general release provide advanced driver assistance (ADAS) which provide essentially advanced cruise control capabilities designed primarily for use in highway commutes. Musk said on the call that he expects the company will seek to prove out its FSD capabilities before entering into any licensing agreements, if it does end up pursuing that path.

Musk noted that Tesla’s “philosophy is definitely not to create walled gardens” overall, and pointed out that the company is planning to allow other automakers to use its Supercharger networks, as well as its autonomy software. He characterized Tesla as “more than happy to license” those autonomous technologies to “other car companies,” in fact.

One key technical hurdle required to get to a point where Tesla’s technology is able to demonstrate true reliability far surpassing that of a standard human driver is transition the neural networks operating in the cars and providing them with the analysis that powers their perception engines is to transition those to video. That’s a full-stack transition across the system away from basing it around neural nets trained on single cameras and single frames.

To this end, the company has developed video labelling software that has had “a huge effect on the efficiency of labeling,” with the ultimate aim being enabling automatic labeling. Musk (who isn’t known for modesty around his company’s achievements, it should be said) noted that Tesla believes “it may be the best neural net training computer in the world by possibly an order of magnitude,” adding that it’s also “something we can offer potentially as a service.”

Training huge quantities of video data will help Tesla push the reliability of its software from 100% that of a human driver, to 200% and eventually to “2,000% better than the average human,” Musk said, while again suggesting that it won’t be a technological achievement the company is interested into keeping to themselves.