1. Cybertruck Price Far Above Expectations;
2. Israel-Hamas War to Last for Years;
3. Brookfield Launches Largest Infrastructure Fund;
4. EU Probes Serious Side Effects of Weight-Loss Drugs;
5. Sixt Phasing Out Teslas;
6. US Tightens EV Tax Credit Rules;
7. Manhattan May Impose $15 Congestion Toll.
1. Cybertruck Price Far Above Expectations
On Thursday, Tesla CEO Elon Musk finally delivered the long-delayed Cybertruck to the first group of customers, including Reddit co-founder Alexis Ohanian.
Tesla also announced that the base model Cybertruck will go on sale in 2025 for $60,990 — 50% higher than the promotional price advertised four years ago.
Tesla is now accepting preorders for two higher-tier Cybertruck models, priced at $79,990 and $99,990, with deliveries expected in 2024.
The top-end range reaches 340 miles, well below the previously advertised 500-mile range.
Gene Munster, managing partner at Deepwater Asset Management, said the Cybertruck’s price far exceeded expectations. Tesla will need to ramp up production to lower costs — but scaling up production will be a major challenge.
Tesla stock fell 2.1% in premarket trading. It had climbed 20% ahead of the Cybertruck launch.
______
2. Israel-Hamas War to Last for Years
This morning, the ceasefire between Israel and Hamas came to an end after just one week. Multiple sources revealed that Israel plans to launch a multi-year offensive against Hamas, with the most intense ground assault expected in early 2024, aimed at fully dismantling the group.
Israeli forces stationed in northern Gaza will continue advancing south.
Strategic goals include eliminating three top Hamas leaders — Yahya Sinwar, Mohammed Deif, and Marwan Issa.
Those familiar with Israel’s military strategy say the conflict is set to be long and drawn out.
______
3. Brookfield Launches Largest Infrastructure Fund
Canadian private equity giant Brookfield has launched the world’s largest infrastructure fund at $28 billion, with plans to invest in airports, railroads, oil pipelines, and LNG export terminals.
Other asset managers like KKR and Blackstone have also rolled out megafunds focused on infrastructure. Blackstone aims to manage over $100 billion in infrastructure assets.
Since the Fed began raising interest rates last year, many institutional investors have flocked to infrastructure as a defensive asset class, given its inflation-linked cash flows.
Brookfield believes the global economy is entering a “deglobalization” era, with more countries investing in domestic manufacturing and energy infrastructure.
______
4. EU Probes Serious Side Effects of Weight-Loss Drugs
Since July, multiple reports of suicidal ideation among GLP-1 weight-loss drug users have drawn attention.
The European Medicines Agency (EMA) has asked drugmakers like Novo Nordisk and Eli Lilly to provide more data on potential side effects of their weight-loss medications.
Today, EMA’s safety committee said it had reviewed all clinical trial data but could not yet draw a conclusion.
Pharmaceutical companies must supply additional information, and the committee will reconvene in April 2024.
GLP-1 drugs have been used to treat diabetes for 15 years, but only recently gained popularity as weight-loss treatments.
______
5. Sixt Phasing Out Teslas
Europe’s largest car rental company, Sixt SE, plans to gradually phase out Tesla vehicles from its fleet due to falling resale values triggered by Tesla’s repeated price cuts.
Additionally, EV repairs tend to be more expensive than for traditional gas-powered cars.
In October, Hertz also noted that Tesla’s price cuts had slashed the resale value of its Tesla fleet by one-third.
Despite the move, Sixt still aims for 90% of its fleet to be electric by 2030.
______
6. US Tightens EV Tax Credit Rules
Today, the US Treasury announced that starting next year, EVs with batteries containing Chinese-made components will no longer qualify for the $7,500 federal tax credit.
Additionally, EVs produced by companies closely tied to China will be ineligible.
President Biden’s clean energy advisor John Podesta said the new rules will push more EV production into the US. However, China still dominates the EV battery supply chain in both scale and cost.
The US government aims for EVs to make up 50% of new car sales by 2030.
______
7. Manhattan May Impose $15 Congestion Toll
New York’s Traffic Mobility Review Board (TMRB) has proposed that drivers entering Manhattan below 60th Street pay a $15 congestion toll between 5 a.m. and 9 p.m. on weekdays, and between 9 a.m. and 9 p.m. on weekends. Trucks would pay $24 to $36 depending on size.
The toll would drop 75% during overnight hours. Low-income drivers would get a 50% discount for their first 10 trips into Manhattan each month.
The MTA plans to start charging the toll in mid-2024, marking the first congestion pricing scheme in the US. It expects to raise $1 billion annually to upgrade public transit infrastructure.
TMRB chair Carl Weisbrod said the toll could reduce traffic volumes by 17%.
______
This content is sourced from Financial Times, Bloomberg, and The Real Deal, among other financial news outlets.