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It’s been a minute, folks! As you might recall, the newsletter took a little holiday break. We’re back and well into 2026. And a lot has happened since the last edition. 

I spent the first week of the year at the Consumer Electronics Show in Las Vegas. And while I wrote about this last January, it’s worth repeating: U.S. automakers have left the building. 

What has filled the void in the Las Vegas Convention Center? Autonomous vehicle tech companies (Zoox, Tensor Auto, Tier IV, and Waymo, which rebranded its Zeekr RT, to name a few), Chinese automakers like Geely and GWM, software and automotive chip companies, and loads of what Nvidia CEO Jensen Huang calls “physical AI.” 

The term, which is sometimes called “embodied AI,” describes the use of AI outside the digital world and into the real, physics-based one. AI models, combined with sensors, cameras, and the motorized controls, allow that physical thing — humanoid robot, drone, autonomous forklift, robotaxi — to detect and understand what’s in this real environment and make decisions to operate within it. And it was all over the place from agriculture and robotics to autonomous vehicles and drones, industrial manufacturing, and wearables. 

Hyundai had one of the busiest and largest exhibits with a near-constant line wrapped around the entrance. The Korean automaker wasn’t showing cars. Nope, it was robots of various forms, including the Atlas humanoid robot, courtesy of its subsidiary Boston Dynamics. There were also innovations that have come out of Hyundai Motor Group Robotics LAB, including a robot that charges electric autonomous vehicles, and a four-wheel electric platform called the Mobile Eccentric Droid (MobEd) that is going into production this year. It seems everyone was embracing and showcasing robotics, particularly humanoids. 

The hype around humanoids, specifically, and physical AI, in general, was palpable. I asked Mobileye co-founder and president Amnon Shashua about this because his company just bought his humanoid robotics startup for $900 million: “What do you say when people tell you humanoid robots are all hype?” 

“The internet was also a hype, remember in 2000, the crisis of the internet,” Shashua said. “It did not mean that [the] internet is not a real thing. Hype means that companies are overvalued for a certain period of time, and then they crash. It does not mean that the domain is not real. I believe that the domain of humanoids is real.”

A few notable stories from CES:
Nvidia launches Alpamayo, open AI models that allow autonomous vehicles to ‘think like a human’

This is Uber’s new robotaxi from Lucid and Nuro

Mobileye acquires humanoid robot startup Mentee Robotics for $900M

Now onto the other non-CES and more recent news … 

A little bird

President Trump made comments this week at a Detroit Economic Club meeting about welcoming Chinese automakers into the United States that did not sit well with many in the auto industry, according to insiders I have spoken to. Specifically, I have been told the Alliance for Automotive Innovation (the industry lobbying group) is “freaking out,” one DC insider told me. 

“If they want to come in and build a plant and hire you and hire your friends and your neighbors, that’s great, I love that,” Trump said, according to reporters in attendance. “Let China come in, let Japan come in.”

A couple of notes. Japanese companies like Toyota are already very much in the United States. The bigger hurdle, beyond protests from within the boardrooms of U.S. automakers, is existing law. In 2025, the U.S. Department of Commerce’s Bureau of Industry and Security issued a rule that restricts the import and sale of certain connected vehicles and related hardware and software linked to China or Russia. This essentially bans the sale of Chinese vehicles in the country. 

Avery Ash, who is CEO of SAFE, a nonpartisan organization focused on securing U.S. energy, critical materials, and supply chains, weighed in about the dangers of allowing Chinese automakers to sell their vehicles in the United States. Side note: Ash was on my podcast, the Autonocast, which touches on some of this subject.

“Welcoming Chinese automakers to build cars here in the U.S. will reverse these hard-won accomplishments and put Americans at risk,” he said. ”We’ve seen this strategy backfire in Europe and elsewhere — it would have potentially catastrophic impacts on our automotive industry, have ripple effects on our entire defense industrial base, and make every American less secure.”

Meanwhile, Canada is opening the door to Chinese automakers. Canadian prime minister Mark Carney announced his country will slash its 100% import tax on Chinese EVs to just 6.1%, Sean O’Kane reports.

”Got a tip for us to share in the Little Bird section? Email Kirsten Korosec at kirsten.korosec@techcrunch.com or my Signal at kkorosec.07, or email Sean O’Kane at sean.okane@techcrunch.com. 

Deals!

Budget carrier Allegiant agreed to buy rival Sun Country Airlines for about $1.5 billion in cash and stock.

Dealerware, which sells software services to automotive OEMs and retailers, was acquired by a group of investors led by Wavecrest Growth Partners and Radian Capital. Automotive Ventures and automotive industry executives David Metter and Devin Daly also participated. The terms were not disclosed.

Long-distance bus and train provider Flix acquired the majority share of European airport transfer-platform Flibco. Luxembourg company SLG will retain some ownership stake in Flibco. Terms weren’t disclosed. 

JetZero, the Long Beach, California, startup developing a midsized triangular aircraft designed to save on fuel, raised $175 million in a Series B round led by B Capital, Bloomberg reported.

Joby Aviation, a company developing electric air taxis, reached an agreement to buy a 700,000-square-foot manufacturing facility in Dayton, Ohio, to support its plans to double production to four aircraft per month in 2027.

Luminar has reached a deal to sell its lidar business to a company called Quantum Computing Inc. for just $22 million. If that seems low, you’re right. Luminar’s valuation peaked in 2021 at $11 billion.

Notable reads and other tidbits

Bluspark Global, a New York-based shipping and supply chain software company, didn’t realize its platform was vulnerable and open to anyone on the internet. Here’s how a security researcher (and TechCrunch) got it fixed.

The Federal Trade Commission finalized an order that bans General Motors and its OnStar telematics service from sharing certain consumer data with consumer reporting agencies. Read the full story on what that means.

InDrive, the company that started as a ride-hailing platform that lets users set the price, is diversifying and starting to execute on its “super app” strategy. That means more in-app advertising across its top 20 markets and expanding grocery delivery to Pakistan. Read the full story here. 

Motional, the majority Hyundai-owned autonomous vehicle company, has rebooted. When Motional paused its operations last year, I wasn’t sure it was going to survive. Other AV companies with big backers have seen their funding disappear in a blink, so it was certainly plausible. But the company is here and with a new AI-first approach. Before you roll your eyes at that term, take a read of my article, which includes a demo ride and an interview with CEO Laura Major. Then feel free to hit my inbox with your thoughts. 

New York governor Kathy Hochul plans to introduce legislation that would effectively legalize robotaxis in the state with the exception of New York City. No details on this yet; I’ve been told it will all be revealed in her executive budget proposal next week. What we do know is the proposal is designed to expand the state’s existing AV pilot program to allow for “the limited deployment of commercial for-hire autonomous passenger vehicles outside New York City.” My article delves deeper into what she shared and gives an update on Waymo’s NYC permit. 

Tesla is ditching the one-time fee option for its Full Self-driving (Supervised) software and will now sell access to the feature through a monthly subscription.

On-demand drone delivery company Wing is bringing its service to another 150 Walmart stores as part of an expanded partnership with the retailer.

Sequoia Capital is reportedly joining a blockbuster funding round for Anthropic, the AI startup behind Claude, according to the Financial Times. It’s a move sure to turn heads in Silicon Valley.

Why? Because venture capital firms have historically avoided backing competing companies in the same sector, preferring to place their bets on a single winner. Yet here’s Sequoia, already invested in both OpenAI and Elon Musk’s xAI, now throwing its weight behind Anthropic, too.

The timing is particularly surprising given what OpenAI CEO Sam Altman said under oath last year. As part of OpenAI’s defense against Musk’s lawsuit, Altman addressed rumors about restrictions in OpenAI’s 2024 funding round. While he denied that OpenAI investors were broadly prohibited from backing rivals, he did acknowledge that investors with ongoing access to OpenAI’s confidential information were told that access would be terminated “if they made non-passive investments in OpenAI’s competitors.” Altman called this “industry standard” protection (which it is) against misuse of competitively-sensitive information.

According to the FT, Sequoia is joining a funding round led by Singapore’s GIC and U.S. investor Coatue, who are each contributing $1.5 billion. Anthropic is aiming to raise $25 billion or more at a $350 billion valuation — more than double its $170 billion valuation from just four months ago. The WSJ and Bloomberg had earlier reported the round at $10 billion. Microsoft and Nvidia have committed up to $15 billion combined, with VCs and other investors said to be contributing another $10 billion or more.

The Sequoia connection with Altman runs deep. When Altman dropped out of Stanford to start Loopt, Sequoia backed him. He later became a “scout” for Sequoia, introducing the firm to Stripe, which became one of the firm’s most valuable portfolio companies. Sequoia’s new co-leader Alfred Lin and Altman also appear comparatively close. Lin has interviewed Altman numerous times at Sequoia events, and when Altman was briefly ousted from OpenAI in November 2023, Lin publicly said he’d eagerly back Altman’s “next world-changing company.”

While Sequoia’s investment in xAI might seem to have already contradicted the traditional VC approach of picking winners, that bet is widely viewed as less about backing an OpenAI competitor and more about deepening the firm’s extensive ties to Elon Musk. Sequoia invested in X when Musk bought Twitter and rebranded it, is an investor in SpaceX and The Boring Company, and is a major backer of Neuralink, Musk’s brain-computer interface company. Longtime Sequoia leader Michael Moritz was even an early investor in Musk’s X.com, which became part of PayPal.

Sequoia’s apparent reversal on portfolio conflicts is especially glaring given its historical stance. As we reported in 2020, the firm took the extraordinary step of walking away from its investment in payments company Finix after determining the startup competed with Stripe. Sequoia forfeited its $21 million investment, letting Finix keep the money while giving up its board seat, information rights, and shares, marking the first time in the firm’s history it had severed ties with a newly funded company over a conflict of interest. (Sequoia had led Finix’s $35 million Series B round just months earlier.)

The reported Anthropic investment comes after dramatic leadership changes at Sequoia, where Roelof Botha was pushed out in a surprise vote just days after sitting down with this editor at TechCrunch Disrupt, with Lin and Pat Grady — who’d led that Finix deal — taking over.

Anthropic is reportedly preparing for an IPO that could come as soon as this year. We’ve reached out to Sequoia Capital for comment.

In October, at a tech conference in Italy, Amazon and Blue Origin founder Jeff Bezos predicted that millions of people will be living in space “in the next couple of decades” and “mostly,” he’d said, “because they want to,” because robots will be more cost-effective than humans for doing the actual work in space.

No doubt that’s why my ears perked up when, at TechCrunch Disrupt in San Francisco weeks later, I found an on-stage prediction by Will Bruey, the founder of space manufacturing startup Varda Space Industries, so striking. Rather than robots doing the work as Bezos envisioned, Bruey said that within 15 to 20 years, it will be cheaper to send a “working-class human” to orbit for a month than to develop better machines.

In the moment, few in the tech-forward audience seemed taken aback at what many might consider a provocative statement about cost savings. But that raised questions for me – and it has certainly raised questions for others – about who, exactly, will be working among the stars, and under what conditions.

To explore these questions, I spoke this week with Mary-Jane Rubenstein, dean of social sciences and professor of religion and science and technology studies at Wesleyan University. Rubenstein is the author of the book Worlds Without End: The Many Lives of the Multiverse, which director Daniel Kwan used as research for the award-winning 2022 film “Everything Everywhere All at Once.” More recently, she’s been examining the ethics of space expansion.

Rubenstein’s response to Bruey’s prediction cuts to a fundamental issue – which is power imbalance.”Workers already have a hard enough time on Earth paying their bills and keeping themselves safe . . . and insured,” she told me. “And that dependence on our employers only increases dramatically when one is dependent on one’s employer not just for a paycheck and sometimes for health care, but also for basic access, to food and to water – and also to air.”

Her assessment of space as a workplace was pretty direct. While it’s easy to romanticize space as an escape to a pristine frontier where people will float weightlessly among the stars, it’s worth remembering there are no oceans or mountains or chirpy birds in space. It’s “not nice up there,” said Rubenstein. “It is not nice at all.”

But worker protections aren’t Rubenstein’s only concern. There’s also the increasingly contentious question of who owns what in space – a legal gray area that’s becoming more problematic as commercial space operations accelerate.

The 1967 Outer Space Treaty established that no nation could claim sovereignty over celestial bodies. The moon, Mars, asteroids – these are supposed to belong to all of humanity. But in 2015, the U.S. passed the Commercial Space Launch Competitiveness Act, which says that while you can’t own the moon, you can own whatever you extract from it. Silicon Valley got starry-eyed almost immediately; the law opened the door to commercial exploitation of space resources, even as the rest of the world watched with concern.

Rubenstein offers an analogy: It’s like saying you can’t own a house, but you can own everything inside it. Actually, she corrects herself, saying it’s worse than that. “It’s more like saying you can’t own the house, but you can have the floorboards and the beams. Because the stuff that is in the moon is the moon. There’s no difference between the stuff the moon contains and the moon itself.”

Green light red light

Companies have been positioning themselves to exploit this framework for some time. AstroForge is pursuing asteroid mining. Interlune wants to extract Helium-3 from the moon. The problem is that these aren’t renewable resources. “Once the U.S. takes [the Helium-3], China can’t get it,” says Rubenstein. “Once China takes it, the U.S. can’t get it.”

The international reaction to that 2015 act was swift. At the 2016 UN Committee on the Peaceful Uses of Outer Space (COPUOS) meeting, Russia called the Act a unilateral violation of international law. Belgium warned about global economic imbalances. 

In response, the U.S. in 2020 created the Artemis Accords – bilateral agreements with allied nations that formalized the American interpretation of space law, particularly around resource extraction. Countries worried about being left out of the new space economy signed on. There are now 60 signatories, though notably Russia and China are not among them. 

There is grumbling in the background, though. “This is one of those instances of the U.S. setting rules and then asking other people to join in or be left out,” Rubenstein says. The Accords don’t say resource extraction is explicitly legal – just that it doesn’t constitute the “national appropriation” that the Outer Space Treaty forbids. It’s a careful dance around a fraught issue.

Her proposed solution to addressing it is straightforward if exceedingly unlikely: hand control back to the UN and COPUOS. In the absence of that, she suggests repealing the Wolf Amendment, a 2011 law that essentially bans NASA and other federal agencies from using federal funds to work with China or Chinese-owned companies without explicit FBI certification and Congressional approval.

When people tell Rubenstein that collaboration with China is impossible, she has a ready response: “We’re talking about an industry that is saying things like, ‘It’ll totally be possible to house thousands of people in a space hotel,’ or ‘It’ll be possible within 10 years to ship a million people to Mars, where there’s no air and where the radioactivity will give you cancer in a second and where your blood will boil and your face will fall off. If it’s possible to imagine doing those things, I think it is possible to imagine the U.S. talking to China.”

Rubenstein’s broader concern is about what we’re choosing to do with space. She sees the current approach – turning the moon into what she calls “a cosmic gas station,” mining asteroids, establishing warfare capabilities in orbit – as profoundly misguided.

Science fiction has given us different templates for imagining space, she notes. She divides the genre into three broad categories. First, there’s the “conquest” genre, or stories written “in service of the expansion of a nation-state or the expansion of capital,” treating space as the next frontier to conquer, just as European explorers once viewed new continents.

Then there’s dystopian science fiction, meant as warnings about destructive paths. But here’s where something odd happens: “Some tech companies seem to sort of miss the joke in this dystopian genre and just sort of actualize whatever the warning was,” she says. 

The third strand uses space to imagine alternative societies with different ideas of justice and care –  what Rubenstein calls “speculative fiction” in a “high-tech key,” meaning they use futuristic technological settings as their framework.

When it first became clear which template was dominating actual space development (fully in the conquest category), she got depressed. “This seemed to me a real missed opportunity for extending the values and priorities that we have in this world into those realms that we have previously reserved for thinking in different kinds of ways.”

Rubenstein isn’t expecting dramatic policy shifts anytime soon, but she sees some realistic paths forward. One is tightening environmental regulations for space actors; as she notes, we’re only beginning to understand how rocket emissions and re-entering debris affect the ozone layer we spent decades repairing.

A more promising opportunity, though, is space debris. With more than 40,000 trackable objects now circling Earth at 17,000 miles per hour, we’re approaching the Kessler effect – a runaway collision scenario that could make orbit unusable for any future launches. “Nobody wants that,” she says. “The U.S. government doesn’t want that. China doesn’t want it. The industry doesn’t want it.” It’s rare to find an issue where every stakeholder’s interests align perfectly, but “space garbage is bad for everybody,” she notes. 

She’s now working on a proposal for an annual conference bringing together academics, NASA representatives, and industry figures to discuss how to approach space “mindfully, ethically, collaboratively.”

Whether anyone will listen is another question. There certainly doesn’t seem to be much motivation to come together on the issue. In fact, back in July of last year, Congress introduced legislation to make the Wolf Amendment permanent, which would entrench restrictions on China cooperation rather than loosen them.

In the background, startup founders are projecting major changes in space within five to ten years, companies are positioning themselves to mine asteroids and the moon, and Bruey’s prediction about blue-collar workers in orbit hangs in the air, unanswered.