Jun 1, 2017

Tesla is becoming the talk of the town

Mark Schiefelbein / AP

"Investors pick Tesla's promise over GM's steady profits," by AP's Tom Krisher and Dee-Ann Durbin, in Detroit:

  • GM's stock is trading around the $33 price of its initial public offering seven years ago. During that time, Tesla shares have soared more than tenfold to $335.
  • Wall Street now values Tesla at about $55 billion, compared to around $50 billion for GM.
  • Despite efforts to paint themselves as technology companies, automakers can't shake their giant, capital-intensive global manufacturing operations. The huge investment needed to build vehicles yields low profit margins compared with tech companies that make software or cell phones.
  • Why it matters: The big changes in the auto industry are in the early stages. Electric vehicles make up less than 1% of global auto sales, and fully self-driving cars are years away.

Go deeper

HBCUs are missing from the discussion on venture capital's diversity

Illustration: Eniola Odetunde/Axios

Venture capital is beginning a belated conversation about its dearth of black investors and support of black founders, but hasn't yet turned its attention to the trivial participation of historically black colleges and universities (HBCUs) as limited partners in funds.

Why it matters: This increases educational and economic inequality, as the vast majority of VC profits go to limited partners.

Unemployment rate falls to 13.3% in May

Data: Bureau of Labor Statistics; Chart: Axios Visuals

The U.S. unemployment rate fell to 13.3% in May, with 2.5 million jobs gained, the government said on Friday.

Why it matters: The far better-than-expected numbers show a surprising improvement in the job market, which has been devastated by the coronavirus pandemic.

The difficulty of calculating the real unemployment rate

Data: U.S. Department of Labor; Note: Initial traditional state claims from the weeks of May 23 and 30, continuing traditional claims from May 23. Initial PUA claims from May 16, 23, and 30, continuing PUA and other programs from May 16; Chart: Andrew Witherspoon/Axios

The shocking May jobs report — with a decline in the unemployment rate to 13.3% and more than 2 million jobs added — destroyed expectations of a much worse economic picture.

Why it matters: Traditional economic reports have failed to keep up with the devastation of the coronavirus pandemic and have made it nearly impossible for researchers to determine the state of the U.S. labor market or the economy.