GM’s investors school Tesla’s on self-driving hype 22 Jan 2020 Shares in Mary Barra’s $50 bln carmaker barely budged after it unveiled its autonomous vehicle, yet the potential of similar technology helped Elon Musk’s outfit to top $100 bln in market value. Considering true self-driving remains a long way off, GM’s owners are more realistic.
Alstom-Bombardier rail M&A would face faulty track 22 Jan 2020 The $11 bln French train maker and its Canadian rival are discussing a deal, Bloomberg reported. The former’s failed deal with Siemens posed more obvious EU antitrust issues, but Brussels may still balk. And synergies that rely on big job cuts in France will be politically toxic.
Rising fares squeeze Ryanair’s budget mantra 10 Jan 2020 The low-cost carrier lifted its full-year earnings forecast by 17% after a bumper holiday season. Boss Michael O’Leary can thank Thomas Cook’s demise and grounded 737 MAX planes for dearer tickets. But price hikes dent the halo of the self-appointed patron saint of cheap flights.
IAG dealmaking will outlast Willie Walsh 9 Jan 2020 The Irishman is disembarking after nine years at the helm of the BA and Iberia owner. The holding structure he led from its birth has been more successful than Air France-KLM and makes it easier for his successor to go shopping, say for a carrier that flies to South America.
Greta Thunberg will clog EU budget-airline engines 2 Jan 2020 Climate change will make regulators rethink free carbon credits and impose fuel taxes, hitting easyJet and Norwegian Air hard. More pain would come if the teen activist-inspired drop in Swedish air travel spreads across Europe. All in, 48 bln euros of industry value is at risk.
Travis Kalanick leaves Uber with no path to profit 24 Dec 2019 The ride-hailing app’s co-founder and ex-CEO is leaving the board after being sidelined and selling most of his shares. The $53 bln firm has moved on from his tumultuous leadership. But successor Dara Khosrowshahi has yet to work out how to remove the roadblocks to making money.
Boeing woes help Airbus customers more than Airbus 17 Dec 2019 The U.S. plane maker is suspending production of its grounded 737 MAX jet. Its European rival is already working at full capacity, but Airbus-reliant airlines, including easyJet, are in a sweep spot. They can keep expanding, while a capacity squeeze pushes up fares and margins.
Boeing 737 MAX cuts will speed margins descent 16 Dec 2019 Limited competition has insulated the $185 bln aircraft maker’s shares from the long grounding. The plane may fly again soon, but investors and CEO Dennis Muilenburg expect rising profitability. Newly zealous regulators, overstretched staff and economic winds say otherwise.
Chile protests give investors a rude awakening 21 Oct 2019 Latin America’s golden child erupted in violence this past weekend over a subway-fare hike. Its economy seems strong for an emerging market, but the unrest comes amid slowing growth, a weakened currency and a feeble copper market. Bondholders aren’t pricing in the risks.
Tata should make a U-turn on Jaguar Land Rover 9 Oct 2019 The Indian carmaker has clung to the marques since buying them for $2.3 bln in 2008. As auto sales plummet, though, Tata would be smarter to focus on its home market without the cash-burning JLR distraction. It also could pocket a tidy sum as a seller in a consolidating industry.
American cities risk becoming new weak data link 10 Sep 2019 Los Angeles’ trip info program for e-scooters and bikes is expanding to other towns. It manages congestion but also sparks privacy and hacking concerns. Contractors may also try to avoid a stricter California data law. Including ride hailing makes proper controls more critical.
Uber labor bill risks straying from righteous road 29 Aug 2019 The ride-hailing giant’s home state of California wants gig-economy firms to give workers paid vacation and sick time, following similar cases in Europe. Yet some old-school industries may get carve-outs. That would be a pity. It’s a chance to rethink protections for all earners.
Green fears could keep UK high-speed rail on track 23 Aug 2019 The so-called HS2 link from London to northern England may end up 29 billion pounds over budget. That eats into benefits of the bullet train’s potential to narrow Britain’s troubling north-south divide. Yet concerns about global warming point to the project maintaining momentum.
A VW-Tesla marriage looks heartbreakingly remote 22 Aug 2019 The German carmaker’s CEO Herbert Diess covets the $40 bln group’s tech, Manager Magazin reported. Tesla could use VW’s cash and manufacturing nous. But boss Elon Musk has shown no interest in cooperating with rivals. And Tesla’s crazy-high valuation makes a takeover unlikely.
Uber-Lyft price-war truce will be temporary 8 Aug 2019 The ride-hailing firms say user fees are becoming more rational while passenger growth was steady. But, expenses are up. A record $5.2 bln quarterly loss and drags from freight and food delivery put Uber under more pressure. Cutting prices may be a tempting way to boost growth.
A year later, Tesla could use buyout-like focus 7 Aug 2019 CEO Elon Musk was upbraided for tweeting he had “funding secured” to take the carmaker private 12 months ago. Tesla now trades at barely half his mooted price, loses money and struggles to sustain growth. It’s no LBO candidate, but a dose of buyout discipline wouldn’t go amiss.
U.S. strength gives Fiat Chrysler an M&A breather 31 Jul 2019 The $21 billion Jeep maker is braving the car market downturn better than rivals. Record results in the key North American market produced better-than-expected operating profit. That gives boss Mike Manley headroom to cut costs while keeping an eye out for potential partners.
U.S. car-pollution pact cuts through D.C. smog 25 Jul 2019 California’s deal with BMW, Ford, Honda and VW shows the auto industry can cut U.S. emissions despite White House intransigence. The better match with overseas standards should aid progress and profitability. Add incentives to invest in electric vehicles and it’s a smart mix.
VW debt paints fairer picture than battered shares 25 Jul 2019 The carmaker’s valuation implies it will be worthless by the mid-2020s. Yet its 10-year bonds yield just 1.4%. Shareholders are panicked by the threat of tariffs, ride-sharing, and self-driving cars. But the disparity shows investor pessimism towards the auto sector is overdone.
If only James Bond could rescue Aston Martin 24 Jul 2019 The $2.2 bln maker of 007’s legendary sports car is struggling. With the auto industry’s future in flux, once-reliable buyers like VW or Ford are no longer in the business of collecting trophy assets. Barring the odd billionaire, Aston looks destined to continue skidding out.