Autos

China’s $72 bln tax break heralds green-car crunch

23 Jun 2023

Extending hefty incentives to buyers for another four years shows Beijing is anxious to support electric vehicles. But prolonging existing subsidies is unlikely to transform the fortunes of loss-making groups like Nio and Xpeng. Weaker rivals may be nearing the end of the road.

Volkswagen’s tight ship is facing a bigger storm

21 Jun 2023

The $78 bln carmaker’s pledge to boost margins and curb investment may fend off criticisms of inefficiency. Yet CEO Oliver Blume has yet to convince investors he can battle greater competition from Tesla and Chinese rivals. Volkswagen’s depressed valuation may linger.

Pirelli boss turns de-risking into opportunity

19 Jun 2023

Rome has limited the power of the $5 bln tyremaker’s Chinese shareholder, without forcing it to sell. Pirelli and Italy get to de-risk China ties without burning too many bridges. But the real winner is CEO Marco Tronchetti Provera, who has again found a way to come out on top.

China’s next export is an electric-vehicle fight

19 Jun 2023

Carmakers led by BYD have established supremacy against global brands thanks to efficient supply chains. As sales stall in the People’s Republic, their long-held ambitions to drive overseas including to Europe is suddenly a necessity. They’ll road-test rising anti-China sentiment.

Nissan needs new intrigue like a hole in the tyre

16 Jun 2023

The $16 bln carmaker hired Ashwani Gupta as COO to help move past the Carlos Ghosn scandal. Once seen as a potential CEO, he’s leaving amid reports of more internal shenanigans. With profit margins still low and its Renault alliance in flux, Nissan can’t afford such distractions.

Toyota shareholders make 15% the new win-win

16 Jun 2023

That’s how few voted against re-electing Chair Akio Toyoda to the board over concerns about independence. He can claim victory but the biggest dip in years of his approval rating is awkward. It puts pressure on the $270 bln carmaker to keep its US shareholders onside.

Capital Calls: London crypto move, Stellantis SPAC

12 Jun 2023

Concise views on global finance: British Prime Minister Rishi Sunak welcomes Andreessen Horowitz’s UK office just as cryptocurrencies face a regulatory crackdown in the US; the European carmaker’s move to back a London blank-check vehicle is less hairy than it sounds.

Pirelli CEO pivots from globalisation to trade war

5 Jun 2023

Marco Tronchetti Provera teamed up with a Chinese buyer to take the tyremaker private in 2015. Now Sinochem’s 37% stake poses business and governance risks for the $5 bln company. An appeal to Italy’s nationalist government may help the veteran industrialist maintain control.

Capital Calls: Turkey, Indivior

5 Jun 2023

Concise views on global finance: President Tayyip Erdogan’s new treasury minister will struggle to steer the $900 bln economy towards orthodox monetary policies; shares in the London-listed drugmaker jumped after it settled a lawsuit, making it more appealing to potential buyers.

Chinese battery cash will fuel Europe’s EV drive

31 May 2023

The country’s investments in foreign plants and projects to power electric cars quadrupled to $15 bln, chiefly into the EU. Over-reliance on tech leader CATL and its compatriots is a risk. But European rivals are few and carmakers like VW and BMW have more to gain than lose.

Elon Musk is Beijing’s ideal foreign investor

31 May 2023

Officials rolled out the red carpet for the billionaire’s first visit since 2020. His EV investments stimulated local brands, he’s made Twitter amenable to authoritarians, and he shows the People’s Republic is still investable. That buys Tesla lots of political cover in China.

Capital Calls: US debt deal

30 May 2023

Concise views on global finance: The pending deal for raising the debt ceiling would shift $20 billion out of the government’s tax collector. The move eases some short-term budget pressures, but could surrender a seven-fold payoff down the road.

Capital Calls: Russian cash, Chinese car feud

25 May 2023

Concise views on global finance: European plans to divert Russian money to Ukraine are ill-thought-out; a feud between China’s BYD and Great Wall Motor is spooking investors.

Geely’s Aston Martin stunt could backfire

19 May 2023

The Chinese auto giant is doubling its stake in the storied carmaker to 17%, and snagging a board seat. But the 45% premium looks rich. Aston Martin needs to speed electrification and sales in China, but Geely will struggle to squeeze value from a stalling British business.

Tesla pushes limits of India’s electric-car dreams

18 May 2023

Elon Musk hopes to make and sell cars in the country. Giving up demands for import tax breaks and building a factory at scale makes sense if his $550 bln company is a market-maker as it was in China. Tesla would need to follow Apple’s roadmap and engineer a new export hub too.

Tesla’s governance autopilot heads for disaster

17 May 2023

Despite a 60% drop from peak market value and Twitter distractions, shareholders backed the EV-maker’s board yet again. Boss Elon Musk’s indulgence of conspiracy theories and avowal to keep speaking his mind raise more red flags. The supine stance invites dangerous consequences.

EU can afford to extend UK car sector’s pit stop

17 May 2023

Stellantis wants Britain to tweak its trade deal with Europe to avoid tariffs on electric vehicles. Delaying rules on where carmakers source material would help both EU and British manufacturers. Moreover, a reprieve would still leave the bloc streets ahead in the EV race.

Vietnam’s Tesla debuts with wrong kind of power

15 May 2023

VinFast is going public at a sales multiple seven times its rival. Merging at a $27 bln valuation with casino mogul Lawrence Ho’s SPAC secures it a listing in the US where the electric-vehicle maker is expanding. But it needs funding and an inflated 2021-style deal doesn’t help.

Volkswagen has increasingly narrow recovery track

4 May 2023

The $77 bln German auto giant reported bumper revenue, but faces an era of slowing growth as slick rivals like Tesla expand. CEO Oliver Blume hopes to boost car sales by 15% and avoid a collapse in prices. Neither looks easy, but at least its stock is priced for the worst.

Ford and GM can afford to put on a brave face

2 May 2023

Detroit carmakers say profit will hold up despite economic woes and costly electric makeovers, though markets look skeptical. Their reinventions carry risks, but 3.6 mln missing car sales thanks to Covid-era shortages mean their gas guzzlers enjoy plenty of unfulfilled demand.