Transportation

Storms won’t keep Qantas from higher flight path

21 February 2019

Australia's flag carrier said fuel costs pulled first-half earnings down by nearly a fifth to $559 mln. Domestic business proved resilient, though; its fleet and balance sheet are in good shape too. Choppy weather lies ahead, but Qantas looks sturdier than higher-valued rivals.

Boeing can afford a business upgrade

8 February 2019

The $225 bln aerospace firm is considering whether to build a new jet. It stumbled with the 787 a decade ago. Since then, boss Dennis Muilenburg has fixed production snags, and customers are in better shape. A new wide-body could boost Boeing’s lead over Airbus.

Tesla CFO exit news is flashback to bad old days

31 January 2019

The electric-car maker’s new board chair and directors may be helping to tone down CEO Elon Musk’s overwrought promises and tweets. But his decision to wait until the end of an earnings call to disclose that Tesla’s finance chief is leaving shows Musk remains firmly at the wheel.

Harley’s tariff woes are more sidecar than engine

29 January 2019

The $6 bln motorcycle maker clashed with Donald Trump over trade barriers. But its big problem is generational. With Hog-riding baby boomers aging fast and the appeal of big internal-combustion engines on the wane, Harley needs products that will spark millennials’ interest.

Royal Mail decline will make Westminster nervous

29 January 2019

The postal service’s latest warning sent its shares well below its 2013 IPO price. Royal Mail is yet to cut its dividend and has minimal debt, but its main earnings generator is in decline. The risk of a lose-lose scenario involving some kind of UK state support has increased.

The end of gasoline-powered cars is nigh. Soonish.

28 January 2019

Sales of electric vehicles doubled last year while the overall market stagnated. China and California led the charge. The internal combustion engine still dominates, but demographics, governance and economics suggest that dynamic is not far from breaking hard.

EU can afford to shunt Siemens-Alstom to a siding

18 January 2019

Margrethe Vestager may well block the rail groups’ merger. That would rile German and French politicians yearning for a European champion to face down distant fears of Chinese dominance. But if the antitrust tsar pulls the plug, neither Siemens nor Alstom would suffer too much.

Shutdown tests U.S. companies’ stress filters

16 January 2019

Delta Air Lines says it loses $25 mln of revenue every month the government stays closed. Big deal. Like the market plunge that hit bank earnings, the shutdown has high visibility but little lasting impact. There are bigger risks to valuations that are harder to visualize.

Swiss $4 bln freight battle has questionable cargo

16 January 2019

Activist investor Cevian has helped solicit a bid for subscale freight group Panalpina. Would-be owner DSV could face competition from Switzerland’s Kuehne + Nagel, handing shareholders a sweeter price. It’s less clear that either will make a return from a much higher offer.

Lyft, Uber IPOs will drain Tesla’s scarcity value

3 January 2019

Electric vehicles check boxes for sustainability-minded investors. But the ride-hailing firms’ ubiquity and self-driving ambitions will give U.S. public shareholders new options beyond Elon Musk’s carmaker. Lyft’s growth and ESG credentials could make it the most desirable ride.

German takeaway truce delivers tasty value treat

21 December 2018

Delivery Hero is selling its German business to rival Takeaway.com for 930 mln euros. As with Uber's capitulation to Didi in China's car-share wars, it means an end to cutthroat competition in another gig-economy market - and relief for both companies' investors.

Shared bike wipeout indicts China’s startup model

20 December 2018

Ofo is struggling to refund millions of rider deposits, media report. The $2 bln firm, led by a young, stubborn founder, rushed for market share regardless of cost, enabled by indulgent backers like Alibaba. China's wasteful tech spending may be overdue a big bankruptcy.

East Africa will buck global great rift trend

20 December 2018

Twenty-five years after genocide, Rwanda’s economy is motoring sufficiently to need new markets. The potential inclusion of Ethiopia would make East Africa a single market of 250 million people. If it prospers, it would provide a useful counterpoint to global balkanisation.

Uber and Lyft race to get through open IPO window

10 December 2018

The ride-hailing apps are jockeying for pole position with public offering filings. Economic worries have put the broad market in a correction and Moderna’s plunge after a $7.6 bln IPO shows demand for cash-burning firms is limited. This duel risks a nasty collision with reality.

Royal Mail’s last valuation crutch looks shaky

15 November 2018

The UK postal firm’s shares fell after it reported a 25 pct drop in operating profit. Rising costs, falling letter volumes and the need to invest will make it hard for the group to cover its generous dividend. A lower payout would give investors little reason to own the stock.

Exclusive: FedEx drops NRA deal by snail-mail

30 October 2018

The shipping giant is ending discounts for the U.S. gun-lobby group’s members, eight months after other firms ditched similar schemes. FedEx says it’s an economic decision, not a response to mass shootings. Even so, it suggests offending the NRA is no longer bad for business.

Car parts M&A starts looking more compelling

26 October 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.

Hadas: Six economic reasons to hate Uber

25 October 2018

Economists are wrong to drool over the car service provider as an exemplar of free markets. This financial zombie has destructive effects on transit, a dysfunctional strategy and an antisocial approach to regulation. Also, it hurts its workers and makes investors look foolish.

Daimler and Ford dividends have whiff of roadkill

24 October 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.

China’s tech hub warrants an upgrade from Beijing

22 October 2018

Shenzhen has morphed from tiny market town to a $320 bln economy. Conferring a province-like status on it would boost Xi Jinping’s plans to integrate the surrounding region. Having more power in the capital amid a trade war also could help champion the likes of Tencent and DJI.