China’s answer to Uber may be worth more than Uber 13 Apr 2015 Twin taxi-hailing apps Didi and Kuaidi Dache may be worth $14 bln – twice their last reported amount – a Breakingviews calculator shows. They could even close in on the $40 billion valuation of Uber itself. All hangs on what passengers will pay for something they now get free.
U.S. toll road investor dodges predecessors’ ditch 12 Mar 2015 Australia’s IFM will pay $5.7 bln for a bankrupt Indiana turnpike operator, 50 pct more than Macquarie and a Spanish partner shelled out in 2006. Less than half the amount is debt, though, and the road is in far better shape. That should help the firm steer clear of any potholes.
India goes back to future with $137 bln rail push 27 Feb 2015 The government’s ambitious plan will require finesse in raising money. But the investment case is strong. India’s British rulers reaped huge productivity gains by building out the railways 150 years ago. Modernizing the dilapidated network could produce even better returns.
Renault’s turn of speed needs careful handling 12 Feb 2015 The French carmaker has beaten expectations for 2014 by a mile. A 30 pct jump in operating profit, plus an optimistic outlook, pushed the shares up 9 pct. Europe’s recovery should keep Renault on the road. But worsening woes in Russia are a big worry.
Heathrow upstarts have London’s best airport plan 4 Feb 2015 A new runway may be finally built near the UK capital at a cost of up to $28 billion. The three rival proposals all seem to be financially viable, but the independently conceived scheme that would double the length of one of Heathrow’s existing runways looks best placed.
China rail merger reveals topsy-turvy reform logic 31 Dec 2014 The People’s Republic is re-creating its domestic train-building monopoly to boost competitiveness abroad. State-backed CSR will buy almost identical CNR for $14.4 bln. Synergies may take time to realise but the new giant should be able to turn up the heat on foreign rivals.
Baidu’s Uber stake is more hype than substance 17 Dec 2014 The Chinese web giant is already behind rivals Alibaba and Tencent in mobile taxi-apps. Strategically the tie-up looks like a coup. But without financial terms, investors are left in the dark. Uber’s controversial track record and Baidu’s shrinking margins add to the uncertainty.
German carmakers tune up the basics of banking 5 Nov 2014 The in-house operations of VW, Daimler and BMW are all solidly profitable. They follow some basic rules that rivals and bigger institutions often forget. Lend to people who can repay, expand carefully and find secure and cheap funding. Successful owners also help.
BMW extends lead over Daimler 4 Nov 2014 Quarterly results show the Munich carmaker is growing profitably across the world. That makes life harder for arch-rival Daimler, which wants to overtake BMW as the top premium carmaker by 2020. BMW’s share price does not fully reflect that strength.
Train merger could be China’s ticket to elite club 29 Oct 2014 Coupling together two big train-builders into a domestic monopoly sounds like a step backwards. But it would help China better compete against an oligopoly of big, rich-world rivals. For a growing superpower, that probably seems a good enough reason to bend the market norms.
Beijing’s strap-hangers put socialism to test 29 Oct 2014 Increasing the capital’s subway fares for the first time in seven years raises a development dilemma. Should China stump up for public goods like transport, or ask commuters to pay their way? Markets imply the latter, common sense says subsidise. Expect the worst of both worlds.
Most of the heavy lifting lies ahead for Volvo 24 Oct 2014 An unexpected earnings jump propelled shares in the Swedish truck maker up 10 pct. But Volvo is facing an uphill struggle. The outlook for its core European market is weak, and its new cost cutting targets are ambitious.
Daimler can turbo-charge its cash return 23 Oct 2014 The German carmaker is boasting of record sales, rising margins and rich proceeds from asset disposals. But its dividend has not grown in line with a recovery in performance. After years of parsimony, Daimler can afford to be more generous to shareholders.
Edward Hadas: Surge pricing and the just economy 15 Oct 2014 Car service Uber raises its prices to balance supply and demand when drivers are reluctant and customers are eager. That works, but the method has an anti-social edge. For the common good, it’s better to start with just prices and add allocation by patience, need or merit.
Bankrupt toll road leaves taxpayer sitting pretty 30 Sep 2014 Private investors in a 157-mile Indiana toll road are set to be wiped out in bankruptcy court – but only after they sunk millions into new lanes and tolling technology. It’s a rare example of a boom-era deal successfully transferring risk from the public to the private sector.
Macquarie wrong turns put toll road in bankruptcy 23 Sep 2014 The U.S. route backed in part by the Australian bank went bust because of scant traffic, its operator says. In reality, the buyers created insurmountable potholes by overpaying, loading on debt and losing derivative bets. They need only look in the vanity mirror for blame.
Uber can steer round German roadblock 2 Sep 2014 The U.S. taxi app says it will defy a ban issued by a Frankfurt court, risking fines of 250,000 euros per journey. This looks like Silicon Valley arrogance. But Germany’s taxi rules are outdated and flawed. Uber is sticking up for consumers and will probably prevail in the end.
French carmaker teaches world about cheap autos 15 Aug 2014 Renault’s no-frills brand Dacia is Europe’s fastest growing carmaker. Quick gains in market share and rich margins are arousing the interest of rivals, including GM. But selling vehicles for as little as 5,995 pounds isn’t easy. It requires a rethink of all aspects of carmaking.
China’s e-commerce secret weapon: the delivery guy 11 Aug 2014 Fast, cheap delivery has fuelled online shopping, and the growth of companies like Alibaba and JD.com. Thank a plentiful workforce of low-cost couriers that U.S. rivals can only dream of. While that can last for a few more years, unhelpful demographic change is in the post.
Metalworkers, not McKinsey, bend VW to their will 8 Aug 2014 The U.S. consultant has advised some of the most conservative institutions in the world – the Bank of England, even the Vatican. But that hasn’t stopped unions forcing the German carmaker to show it the door. It flags how hard it will be to execute VW’s turnaround plan.