Transportation

Audi arrest puts brakes on VW’s reform drive

18 June 2018

The head of Volkswagen’s luxury brand is being held over fears he may hinder an investigation into emissions cheating. The question is why the long-serving executive still had his job. The carmaker’s messy governance is still hindering new boss Herbert Diess’ cleanup operation.

Renault M&A race sidelines governance niceties

15 June 2018

Investors backed CEO Carlos Ghosn’s pay despite the French state’s opposition. His 7.4 million euro package was greased with soft targets. Yet the high proportion of shares at least gives Ghosn an extra incentive to push for a value-boosting merger with Japan’s Nissan.

India’s taxi-app war enters China territory

15 June 2018

Local operator Ola lost over $700 mln in the year to March 2017 despite growing revenue 70 pct. That’s nearly as much as Uber was burning when it was battling China’s Didi. The U.S. company’s commitment to India suggests losses will keep piling up for both SoftBank-backed firms.

Tencent gets onboard the state capitalism train

8 June 2018

The gaming giant and carmaker Geely are paying $670 mln to buy into a wifi unit of China Railway. Neither is an obvious choice to help bring passengers online. Still, Beijing will encourage more of these unlikely partnerships to help its public-sector behemoths pick up steam.

Uber may find four wheels just as bad as two

7 June 2018

The car-share app plans to run electric cycles in Europe. Logical as it sounds given Uber’s transport expertise, it will lumber the company with troublesome assets, add fresh regulatory risks from city officials, and it could torch cash. The worst part: Uber has little choice.

Greyhound owner’s turnaround faces lengthy delay

31 May 2018

Bus and rail operator FirstGroup’s CEO resigned and its shares fell after it reported a loss, due to competition from low-cost airlines. It can cut costs and sell assets, but tough markets and management upheaval don’t help. A sale looks easier, but may not deliver a good price.

Brazil’s truckers drive toward a fiscal hole

29 May 2018

Protesters demanding lower fuel prices have won concessions from the Temer government. But the specter of revived subsidies and state meddling in oil giant Petrobras hit investor confidence and the real currency, part of the truckers’ problem. Fiscal laxity is not a solution.

GE CEO finally shunts turnaround plan onto tracks

21 May 2018

John Flannery is selling the struggling conglomerate’s sputtering locomotive unit to Wabtec for $2.9 bln and half of the new outfit, most to be spun off to shareholders. It’s not transformational but it removes a big headache and indicates how Flannery might shed other assets.

Tax cuts hasten demise of U.S. corporate pensions

15 May 2018

With a $6 bln annuity purchase, FedEx has offloaded a chunk of its obligations. Lower U.S. tax rates are encouraging more companies to do the same. It’s good for older workers, but it’s another nail in the coffin of employer-provided retirement security for millennials.

U.S. industrial giants need to be better than good

25 April 2018

Boeing shares took off after the $200 bln plane maker beat forecasts and raised its outlook. Rivals with strong earnings that cast even faint doubt on the future, like Northrop Grumman and Lockheed, lost market value. With equities priced for perfection, investors are seeking it.

Subsea 7 can still save McDermott from itself

23 April 2018

The Oslo-listed oil services group has lobbed in a $2 bln offer for its U.S. counterpart. Subsea 7’s bid looks low, and hinges on McDermott ditching an agreed deal with CB&I. But CB&I’s sale of Stone & Webster to Toshiba is a bad precedent, and Subsea 7 can afford to pay more.

India is prize worth keeping for Uber

20 April 2018

The ride-hailing giant says it won’t exit the market with a minority stake as it did in Southeast Asia and China. Uber has a narrower gap with local rival Ola and the country can serve as a good test-bed for new ideas. Without India, Uber would also look less global in an IPO.

Royal Mail’s best Amazon defence is to stay cheap

20 April 2018

The UK postal group has appointed Rico Back to replace departing CEO Moya Greene. The 5.7 bln pound company is staking its future on growing its parcel business. That requires it to both partner and compete with the online giant. Keeping delivery costs low will keep Amazon close.

Electric bikes may show cars some pedal power

16 April 2018

Already big in China, sales of motor-assisted cycles elsewhere may double by 2025 as battery costs fall. The popularity of bike-sharing schemes could spark mass adoption in cities, where e-bikes can be an appealing alternative to autos. No wonder Uber just bought its way in.

Apollo’s Greyhound bet looks past UK politics

12 April 2018

Transport operator FirstGroup has rejected an approach from the U.S. buyout giant. The offer is bold given the UK backlash against rail privatisation. But the company’s American operations, including the iconic long-haul buses, help support its 1.3 bln pound market value.

Cerberus Alitalia carve-up would not fly with Rome

11 April 2018

The private equity firm is reported to be plotting a three-headed bid for the Italian airline. It would see easyJet take short-haul routes and Air France-KLM long ones, while Cerberus puts up the cash. But a breakup plan will not pass muster with a new nationalist government.

Viewsroom: The biggest loser, China or the U.S.?

10 April 2018

A volley of words threatens a trade war between PRC leader Xi Jinping and U.S. President Donald Trump. Developing China has much at risk in fighting with the world’s largest economy. But American businesses are vulnerable too. Plus: Meituan goes all-in with local services.

Canines chase cars, except in case of eHi’s buyout

9 April 2018

The Chinese auto-rental agency has been a dog since its IPO in 2014. While travel is growing in the People’s Republic, that hasn’t translated into a robust business. Still, compared to similar species like Car Inc, eHi's public owners will be fortunate to exit free of bite marks.

D.C. subway could ride Hong Kong’s MTR

20 March 2018

The Washington Metro's equipment and safety woes are a smoking symbol of U.S. infrastructure ineptitude. Market-based fixes would be wise. Other cities have hired Hong Kong's mass-transit provider for help, but its property and punctuality playbook also may be replicable.

Lufthansa’s next challenge will be domestic

15 March 2018

The German airline is reaping the rewards of a 2014 plan to take on no-frills giants like Ryanair. Barring an unexpected rise in oil prices, Chief Executive Carsten Spohr’s next challenge will be to fight off cut-price competitors when they try to encroach on his home turf.