Aston Martin faces winding road to IPO promises 15 Nov 2018 The luxury-car maker’s third-quarter sales almost doubled from a year earlier, but its hoped-for 30 pct EBITDA margin remains distant. The risk of a chaotic Brexit that would hurt production and sales is an added concern. The shares, down a fifth since listing, will languish.
Johnson Controls shows value of recharging early 13 Nov 2018 The conglomerate is selling its car-battery unit to a Brookfield-led investor group for $13 billion. The business has been humming but its lead-acid technology risks being overtaken by lithium-ion powered electric cars. That makes private equity a better ownership vehicle.
Nissan’s U.S. worries go beyond possible tariffs 9 Nov 2018 The $38 bln auto giant had another disappointing quarter as U.S. and European sales slid further. Its bottom line was salvaged by growth in China, strength that may not last. Most carmakers fear trade barriers, but Nissan also needs to design cars Americans want to buy.
New Tesla chair will have to get tougher 8 Nov 2018 Robyn Denholm, CFO at Aussie telco Telstra, is moving from her boardroom seat at the $60 bln electric-car maker to the head of the table to oversee erratic CEO Elon Musk full-time. Splitting the top jobs is good, but Denholm has been part of a group unable to rein him in so far.
Ferrari boss’s cautious driving has merit 5 Nov 2018 Investors punished new CEO Louis Camilleri in August for calling his predecessor’s targets "aspirational". Ferrari’s rising EBITDA margin arguably warrants a more stringent target. Yet trade war fears and volatile Chinese regulation mean Camilleri is right to exercise caution.
GM’s share price doesn’t add up 31 Oct 2018 The carmaker won a near-$15 bln valuation for its autonomous-vehicles unit by ringfencing it and selling chunks to SoftBank and Honda. If that price is right, though, it means the rest of GM is valued as if it's ready for the scrap heap. Decent earnings suggest that’s unfair.
Mike Manley can put FCA’s war chest to good use 30 Oct 2018 The auto group’s new boss is handing shareholders 2 bln euros from a car-parts unit sale. That leaves 4 bln euros for Fiat Chrysler to invest, save or do a deal. Propping up its balance sheet would soothe investors and rating agencies, and be a firm sign of conservative intent.
China tax cut would only be band-aid for carmakers 29 Oct 2018 Halving the levy on new vehicle sales might help prop up falling demand. But it could delay the country’s much-needed industry consolidation. Meanwhile foreign automakers have far more to fear from U.S. and European slowdowns – not to mention the prospect of more trade tariffs.
Uber-Ola strike flags dangerous transit dependency 30 Oct 2018 Drivers demanding higher fares protested for eight straight days in Mumbai, disrupting a city with poor transport options. Uber and Ola steered into trouble by cutting effective salaries paid to partners. The fallout drives home the need for tighter regulation.
Car parts M&A starts looking more compelling 26 Oct 2018 France’s Valeo is the latest in the auto sector to issue a profit warning, sending its shares down by a fifth. Crashing valuations might help deals make more financial sense. Rival Faurecia’s purchase of Japanese peer Clarion shows how the fleetest can exploit the opportunity.
China drives backwards with $144 bln auto bailout 26 Oct 2018 Beijing has awarded FAW, a state-owned dinosaur, a credit line worth almost as much as the whole of Toyota. Propping up the maker of Mao's limousine will discourage foreign partners like Volkswagen. Worse, it will unbalance the overdue consolidation of domestic car giants.
Viewsroom: The $230 bln scam rocking Nordic banks 25 Oct 2018 Danish lender Danske has already lost its chief executive on news that one of its Estonian branches was used to launder Russian money. Now Nordea and others are facing questions. Plus: investors drive car stocks into a ditch - and Daimler's and Ford's dividends look vulnerable.
Musk charges Tesla at least one-quarter full 24 Oct 2018 The delayed Model 3 ramp-up revved up the electric-car maker’s latest sales and drove it into the black. The gains may not be sustainable, and the CEO’s behavior and potential capital needs remain worries. But after a riotously unstable quarter, any hint of normalcy is welcome.
Daimler and Ford dividends have whiff of roadkill 24 Oct 2018 The duo are the car sector's worst stock market performers this year and on track to pay out a higher share of earnings than peers. They will have to dip into cash reserves to do so. Weak sales and investments in electric and autonomous vehicles make such largesse unsustainable.
Renault deserves its battered valuation 23 Oct 2018 The French carmaker trades at one of the lowest multiples in an unloved sector. Shrinking third-quarter sales show why that is merited. An alliance with Nissan and electric-vehicle investments offer glimmers of hope, but neither will turbo-charge shares in the coming year.
KKR throws autos shareholders into a spin 22 Oct 2018 The buyout group is paying $7.1 billion for a Fiat Chrysler-owned supplier. The double-digit earnings multiple is a coup for new FCA CEO Mike Manley. The big premium to where the industry trades needs some justifying. But regular investors may also be too gloomy about the sector.
Bond investors add fuel for Uber’s profit bonfire 18 Oct 2018 The ride-hailing company has tapped the junk market for $2 bln, even though it generates no EBITDA from which to pay interest. Investors are betting either that Uber will turn a profit – or more likely, that its dash for growth will lure future investors who can pay them back.
Volvo fumes are second hazard for truck investors 16 Oct 2018 The $31 bln Swedish group’s warning on engine emissions could scarcely have come at a worse time. Investors are already fretting that demand for commercial vehicles has peaked for the current cycle. When two truck-dashboard lights are flashing, the safest thing to do is bail.
Tesla can find a better chair than James Murdoch 11 Oct 2018 The media executive is in line to lead the board, the FT says. He’d be a better pick than any of the $45 bln electric-car maker’s other directors. But Elon Musk’s tweet denying the story is a reminder that Tesla and its investors need a strong outsider to oversee the CEO.
BMW writes China JV owner manual for its rivals 11 Oct 2018 The luxury carmaker will take control of its venture with Brilliance Auto for $4.2 bln, making it the first to take advantage of new rules. Share weakness has helped it drive a bargain, even if the deal doesn’t close until 2022. Others like Daimler may follow in the slipstream.