- SpaceX is now the focus of a U.S. House panel probe following the company’s decision to launch a spacecraft in December despite being denied a safety waiver that gave it permission to do so.
- The Federal Aviation Administration initially suspended future SpaceX test flights but lifted that restriction in February, saying the company had implemented “corrective actions [that] enhanced public safety.”
- In a letter to the FAA, two Democratic representatives said they were disappointed that the agency “declined to conduct an independent review of the event and, to the best of our knowledge, has not pursued any form of enforcement action.”
- They also asked the FAA to “resist” pressure to forego safety-making decisions and to implement “a strict policy” that includes civil penalties for companies that violate its launch licenses.
The U.S. House Transportation and Infrastructure Committee announced Monday that it is investigating a launch Elon Musk’s SpaceX performed in December.
The probe comes after the Federal Aviation Administration revealed last month that the flight had been conducted after the agency denied SpaceX a safety waiver.
The FAA said it denied that waiver because SpaceX couldn’t prove that the chance of an explosion harming the public was within legal limits. Following the unauthorized launch, it suspended SpaceX from conducting future test flights.
Alongside the FAA’s announcement, a number of aerospace and industry officials condemned SpaceX’s launch as reckless, noting that it could have posed a serious risk to public safety; however, Musk himself was very critical of the FAA, calling its regulatory structure “fundamentally broken.”
At the same time as it publicly announced the violations, the FAA began approving future launches for SpaceX, saying the company had implemented “corrective actions [that] enhanced public safety.”
Still, some critics remained angry because it seemed that SpaceX didn’t face any substantial repercussions for violating its launch license.
That’s where the House probe comes into play.
In a letter to the FAA, Transportation Committee Chair Peter DeFazio (D-Or.) and Rep. Rick Larsen (D-Wa.) said, “Given the high-risk nature of the industry, we are disappointed that the FAA declined to conduct an independent review of the event and, to the best of our knowledge, has not pursued any form of enforcement action.”
Both representatives then called for the FAA to “resist any potential undue influence on launch safety decision-making” by taking “all the time and actions necessary” to evaluate launch proposals.
They also urged the agency to implement “a strict policy” that includes civil penalties for companies that violate their launch licenses.
FAA Inspectors Required at SpaceX Launches
Since revealing the December violation, the FAA now requires agency inspectors to be present at launches.
SpaceX had planned to conduct a launch of its Starship SN11 spacecraft on Monday, but that was postponed because an inspector was unable to reach the launch site in time.
FAA inspector unable to reach Starbase in time for launch today. Postponed to no earlier than tomorrow.— Elon Musk (@elonmusk) March 29, 2021
On Tuesday, SN11 launched. Notably, like several of SpaceX’s last tests, the spacecraft prototype saw a clean launch and reached its target altitude, but it ultimately crashed while trying to land.
See what others are saying: (Reuters) (Space News) (Ars Technica)
Nike To Clean and Resell Used Sneakers at a Discounted Price
- At least 15 Nike retail locations in the U.S. are participating in a new program the company calls “Nike Refurbish,” which is aimed at reducing waste.
- As part of it, Nike will restore shoes with manufacturing flaws, as well as donated or returned shoes, and resell them at a discounted price.
- Shoes at the end of their wear will be recycled into Nike Grind materials that are used to construct running tracks, gym floors, playgrounds, other Nike products, and more.
Nike announced a new program on Monday called “Nike Refurbish” that will help boost sustainability and reduce waste.
As part of the program, the brand will take donated and returned shoes that are like new or gently used, as well as shoes with cosmetic manufacturing flaws, then clean and restore them to resell at a discounted price. Returned shoes must have been brought back within Nike’s 60-day return period in order for them to be resold.
All the refurbished shoes will have labeling on the box with information about their condition grade. Plus, they are also covered under Nike’s 60-day return policy.
Nike’s Recycling Efforts
Nike didn’t say what it previously did with returned sneakers in its announcement, but the new plan is part of its wider attempts to recycle materials.
On its website, it markets the initiative as a way for customers to “help keep shoes out of landfills.” and join Nike’s efforts towards, “Zero carbon and zero waste to help protect the future of sport.”
Shoes that are truly at the end of their wear will be recycled into Nike Grind materials that are then used for tons of other projects, including running tracks, gym floors, playgrounds, outdoor courts, as well as other Nike apparel and footwear.
So far, 15 Nike retail locations across the U.S. are confirmed to be participating in this model, but there are plans in place to expand this list over the course of 2021.
See what others are saying: (FOX Business) (Footwear News) (Miami Herald)
Uber Sees Record Ride Demand But Doesn’t Have Enough Drivers Available
- Demand for Ubers outpaced driver availability in March, according to a Monday statement from Uber.
- On top of seeing its best-performing month since the beginning of pandemic closures, the company also received more bookings last month than any other month in its entire history.
- In an attempt to attract more drivers, Uber announced a $250 million, one-time stimulus payment last week to “boost” driver earnings.
- While Uber said it believes it will turn a profit for 2021, the company could be set back more than $500 million because of a U.K. Supreme Court ruling that gives the country’s drivers minimum wage, holiday pay, and pension.
Uber Posts Record-Setting Growth
Uber announced Monday that its ride requests for the month of March were the highest it has ever recorded in its 12-year history.
According to a filing with the SEC, last month, the company crossed “a $30 billion annualized Gross Bookings run-rate.” Alongside that, average daily Gross Bookings grew 9% from the previous month.
Notably, this also marked the company’s best month since March of last year, when pandemic closures began in the U.S.
On top of that, Uber said its delivery business crossed “a $52 billion annualized Gross Bookings run-rate in March, growing more than 150% year-over-year.”
In fact, that demand over the past month was so high that Uber didn’t have enough drivers to meet it.
“As vaccination rates increase in the United States, we are observing that consumer demand for Mobility is recovering faster than driver availability, and consumer demand for Delivery continues to exceed courier availability,” the company said.
$250 Million Driver Stimulus
Monday’s filing is in line with another announcement from Uber, which said last week that it is opening up a $250 million driver stimulus to “boost” earnings for drivers.
“In 2021, there are more riders requesting trips than there are drivers available to give them—making it a great time to be a driver,” the company said at the time. “We want drivers to take advantage of higher earnings now because this is likely a temporary situation.”
“As the recovery continues, we expect more drivers will be hitting the road, which means that over time earnings will come back to pre-Covid levels.”
Can Uber Become Profitable?
In February, Uber reported $6.8 billion in losses for 2020, and for years, many have questioned if its business model is even profitable at all; however, in this latest filing, Uber said it believes it’ll become profitable by the end of 2021.
That said, last month, the Supreme Court of the United Kingdom handed drivers a major win by ruling that they need to be reclassified as “workers,” guaranteeing them minimum wage, holiday pay, and pension.
While big news, the U.K. classifies “workers” and “employees” separately. As a result, U.K. drivers still aren’t granted full benefits.
The decision will also likely be a setback for Uber, as Bank of America has estimated that it could cost the company more than $500 million.
Uber’s Vaccine Access Fund
In other Uber news, the company — along with PayPal and Walgreens — has launched a “Vaccine Access Fund.”
Through that fund, customers can donate money that will be used to help people who normally lack transportation get to their vaccination appointment.
Notably, all three companies have said they’ll donate a joint $11 million.
That’s on top of the $5 million PayPal previously donated, as well as the 10 million free and discounted rides Uber promised to give in December.
Uber users are able to donate in-app, and PayPal has launched a donation page on its website.
See what others are saying: (The Wall Street Journal) (CNBC) (CNET)
China Hits Alibaba With $2.8 Billion Antitrust Fine
- Chinese regulators slapped Alibaba with a $2.8 billion fine for monopolistic practices on Saturday, which amounts to 4% of the e-commerce mega-giant’s domestic sales.
- Regulators accused the company of specifically engaging in a policy known as “choose one out of two,” where Alibaba would penalize sellers who also used other platforms to sell their goods.
- CEO Daniel Zhang believes the company won’t be negatively affected by the fine, which could have been set as high as 10% of all sales.
- Despite the fine, the company’s stock rose over 6% by Monday’s closing of the Hong Kong stock exchange.
Dominating the Marketplace
The Chinese e-commerce giant Alibaba was hit with a $2.8 billion antitrust fine by Chinese regulators on Saturday for using its dominant position in the market to punish merchants and rivals.
In particular, it engaged in a policy known as “choose one out of two,” where a seller on Alibaba would be penalized in a variety of ways if they were found to be selling on another platform.
While the $2.8 billion fine seems large, it only accounts for 4% of the company’s domestic sales. The fine could’ve been far worse, as antitrust fines in China can go as high as 10% of the company’s annual sales.
Alibaba has agreed to take the fine, not fight it, and will fully comply with the demands of the regulators. Those demands include three years of “self-examination compliance reports” to ensure the company isn’t engaging in the same practices.
The news comes after the company’s founder, Jack Ma, has been under intense scrutiny from Chinese officials. Ma has not been seen in the public eye for months and his Ant Group, a sister company to Alibaba, is being forced by Chinese regulators as of Monday morning to become a financial holding company; therefore facing much stricter banking regulations.
Clear Sailing From Here
Fortunately for Alibaba, the company has managed to dodge much of the scrutiny Ma faces as he isn’t really involved with the business anymore. Its current leadership also doesn’t think the fine will really affect the company at all. Unlike Ma’s past rhetoric that was dismissive of regulators, CEO Daniel Zhang released a statement on Saturday that struck a conciliatory tone.
“Alibaba would not have achieved our growth without sound government regulation and service, and the critical oversight, tolerance and support from all of our constituencies have been crucial to our development,” he said.
Zhang added Monday morning that he doesn’t expect any negative impacts from the situation, which possibly helped Alibaba’s stock to rise sharply from $223 per share to $241 as of Monday’s closing of the Hong Kong Stock Exchange, where the shares are traded.
There are a plethora of reasons that could explain the stock’s rise just after it was the target of a major antitrust fine, but notably, there doesn’t seem to be any more antitrust fines in the pipeline, leading investors to be confident that the worst is behind the company.