Industrials

EU joint debt will reappear despite French squalls

18 Dec 2024

Covid-19 saw the European Union ditch its qualms about issuing bonds backed by the 27-state bloc. Ukraine could spur a similar leap forward. France’s political turmoil is a problem, but Russian aggression and US inaction could force member states to club together to fund defence.

US-China tech war will hold Asian allies hostage

16 Dec 2024

Washington’s curbs on semiconductors and other goods are starting to elicit a response from the People’s Republic. New export control rules offer a way for Beijing to retaliate. Its leverage over giants like Japan’s Toyota or South Korea’s SK Hynix make them prime targets.

Ashtead is out of reasons to stay in London

10 Dec 2024

The $31 bln equipment-rental group plans to shift its main listing to New York. It makes sense since most earnings come from the US. Throw in the prospect of higher CEO pay and President-elect Donald Trump’s America First stance, and the switch looks like a no-brainer.

Europe’s Starlink-lite is a worthwhile also-ran

21 Nov 2024

EU satellite players like Eutelsat are debt-laden minnows compared to Elon Musk’s SpaceX-owned behemoth. But given Starlink now owns more than 60% of all working satellites, Europe has to start somewhere. Investors shouldn’t count on galactic returns, though.

Melrose flags a way through aerospace turbulence

18 Nov 2024

The $8 bln aero supplier’s shares jumped after it reported improved revenue and reaffirmed targets. Melrose’s focus on planes has coincided with big customers slowing the supply of new jets. The good news is that demand for older aircraft repairs is rising sharply.

Elliott puts too many eggs in Honeywell’s basket

13 Nov 2024

The pushy fund manager’s effort to cleave the $150 bln conglomerate is backed by its biggest investment ever. A breakup like ones at other creaking empires such as GE makes sense, but invoking those successful splits is risky. A projected uplift of at least 50% looks optimistic.

Schneider fails first test of CEO succession plan

4 Nov 2024

The French electric equipment maker ousted Chief Executive Peter Herweck after finding him slow in the execution of his strategy. The $150 bln group needs to be fast in hot markets like data centres. But firing its boss after 18 months shows its decision-making is also wanting.

German M&A flurry is powered by lasting tailwinds

4 Nov 2024

Teutonic deal volumes are below their 2021 peak, like everywhere else. Yet a burst of activity, including the $15 bln privatisation of DB Schenker and $16 bln Covestro sale, show signs of life. Radical changes to the country’s industrial model imply an enduring rebound.

Ford’s ride-the-brakes strategy is hard to steer

29 Oct 2024

The Detroit carmaker has trimmed electric vehicle plans that nonetheless lost $1.2 bln last quarter. Meanwhile, the airbag of gas-guzzler profit is deflating on quality and supply issues. Boss Jim Farley says it’s safer to forestall the future. He’s struggling to prove it.

GM clings to its first in class status

22 Oct 2024

The $60 bln carmaker beat expectations for the third quarter in a row. Electric investments are paying off, high prices haven’t scared consumers and it has a path back to robotaxis. Right now, GM is golden. Yet from subsidies to tech breakthroughs, its ranking may be challenged.

Boeing starts to tick off its pre-flight checklist

21 Oct 2024

If workers and markets go along, the $100 bln jet-maker’s new labor contract and a capital raise would stabilize its finances. Next to fix are cultural and technical woes that mired it in a government-capped production slump. The union compact and smart downsizing can help both.

One valve would release pressure at Air Products

17 Oct 2024

A $15 bln commitment to clean hydrogen is weighing on the industrial gas producer. The weakness has attracted attention from pushy investors over governance and capital usage. Selling some of the unproven green energy would help 80-year-old boss Seifi Ghasemi deflate the tension.

Autos’ car crash ups the likelihood of EU airbags

30 Sep 2024

Stellantis and Volkswagen delivered big profit warnings, amid falling demand for cars. Their woes may encourage policymakers to vote through tariffs on Chinese rivals and go easy on EU carbon fines. But falling output and strained consumers mean carmakers need self-help too.

Mercedes’ China motor hits one of two roadblocks

20 Sep 2024

The $64 bln German carmaker warned of collapsing profitability this year, as a real estate bust in its key Chinese market hurt demand. Lower margins weaken scope for big shareholder payouts. Yet political tensions also raise the risk of unpleasant future tariff surprises.

ASML faces bigger problems than China

16 Sep 2024

Fears of US tech export curbs have pummelled the $320 bln Dutch firm’s shares. A longer-term worry is that the growth of AI leads to new technologies, and less need for ASML’s machines that make chips smaller and efficient. That, more than trade wars, may hurt its rich valuation.

Continental breakup tracks novel M&A route

6 Aug 2024

The 11 bln euro manufacturer is considering spinning off its struggling auto parts unit. That should help reveal its healthier tyres division’s hidden value. The automotive sector’s need to cut costs to face the green transition may entice suitors for both businesses.

Porsche looks stuck in rival Ferrari’s slipstream

24 Jul 2024

The 64 bln euro group’s shares have stalled since a 2022 float, and its valuation trails the Italian group by miles. Competition in China and production snafus may hold it back. The risk is that investors value the 911 maker like a normal carmaker, rather than a luxury group.

Boeing and Airbus headwinds are hard to escape

23 Jul 2024

The troubled US jet maker and its European rival aren’t delivering as many planes as customers want. On this Exchange podcast, AirInsight co-founder Addison Schonland explains how some problems stretch back to Covid, whether a third player can break the duopoly, and much more.

Apple’s India ascent is a salve for China woes

19 Jul 2024

The iPhone-maker’s sales in the South Asian country surged to $8 bln thanks to a luxury boom. That pales next to the $73 bln of revenue from the People’s Republic, but stiff competition and sluggish consumption there are a headache. That makes India increasingly vital for Apple.

Boeing CEO hunt involves checking many boxes

17 Jul 2024

Repairing the battered jet-maker is a once-in-a-career challenge. Dave Calhoun’s successor will have to bolster cash flow, reduce factory snafus and design and fund a better plane. They’ll need precision, tech smarts and, crucially, a willingness to gamble their reputation.