Industrials

Trade spats give repair giants narrow flight path

2 May 2025

Firms such as $115 bln Safran have been flying high as investors bet they will reap the benefits of plane shortages. Trade tensions – and airlines refusing to pay duties on new jets – could boost the trend further. But there’s a risk uncertainty will ground appetite for travel.

Auto investors make bold bet on more Trump U-turns

30 Apr 2025

Volkswagen, Stellantis and Mercedes have largely swerved the question of how much pain they expect from tariffs of up to 25%. While duties may clobber earnings and sales, valuations are not pricing in the worst. It implies a deeper stock crash if the US president plays hardball.

Why a defence boss could boost Europe’s revival

22 Apr 2025

The region’s armies, and their corporate suppliers, lack cross-border scale and a joint investment approach. Putting someone in charge of common projects, including with non-EU members like Britain, could make sure that a 640 bln euro annual defence budget is well spent.

Swiss spinoff proves that not all robots are equal

17 Apr 2025

Conglomerate ABB will hand its industrial arm-making unit to investors. It makes sense given fierce competition and scant overlap with the rest of the $95 bln group. With Nvidia and Tesla’s CEO hyping automatons, it’s a reminder that selling robots can be a low-margin endeavour.

EU’s SpaceX rival demands more than financial fuel

10 Apr 2025

Europe wants a home-grown alternative to Elon Musk’s rockets-and-satellites firm. That will require state largesse: SpaceX became a giant with the help of $28 bln in US government contracts. But it will also need supportive policy, new technologies and far greater ambition.

Trump trade shock boosts the drab autarky trade

4 Apr 2025

Tariff chaos dragged down the S&P 500, yet recent laggards like tiremaker Goodyear or spud seller Lamb Weston have risen. Protectionism may not clinch industrial rebirth, but as once-easy bets on tech hype stall, a hunt for safe harbors will revive long-suffering value investors.

Cross-border home renovation deal is full of gaps

24 Mar 2025

On paper, Chicago-based decks and railings maker Azek complements its buyer, Aussie- and NYSE-listed cladding manufacturer James Hardie. But cost cuts don't cover the 41% premium on the $9bln deal and other synergies look dubious, not least as tariffs are set to hit US consumers.

Europe’s defence push provides cover for tax raid

3 Mar 2025

US hostility to its erstwhile European allies heightens the need for the continent to rearm. Extra spending increases pressure on already stretched finances. But leaders who gathered in London over the weekend have a consolation of sorts: the crisis is an excuse to raise taxes.

Rolls-Royce has sunny skies, with a fuzzy horizon

27 Feb 2025

The $80 bln engine maker’s stock rose 20% after it beat forecasts and raised targets. A strong backlog of work plus exposure to defence suggest the sweet spot can last. One longer-term uncertainty is how to enter the market for short-haul planes without taking on too much risk.

GM illuminates good times before they stop rolling

26 Feb 2025

When the Chevy maker was struggling with its electric transition and strike in 2023, it returned cash to allay shareholders. With tariffs and auto-loan stress looming, boss Mary Barra unveiled a fresh $6 bln stock buyback plan. It projects strength as weaknesses come to the fore.

How to raise $420 bln a year for Europe’s defence

24 Feb 2025

The partial breakdown in the transatlantic alliance means the continent may need to double its defence spending. The money will have to come from a mixture of national budgets, European Union funds and perhaps a new vehicle. Many sacred cows will be slaughtered on the way.

Tank maker’s surge depends on political air cover

18 Feb 2025

Shares in $43 bln Rheinmetall have outperformed chip darling Nvidia since 2021 and doubled since the US election. Investors are implicitly assuming Europe will lift defence spending to at least 3% of GDP while hugely favouring the German firm. They could be wrong on either front.

EU joint defence debt has many hoops to go through

18 Feb 2025

European powers are contemplating the idea of a common borrowing vehicle to finance a big hike in military spending. But they need to agree on which EU countries are involved, and how to include the UK. In any case, it would only delay the fiscal cost of a major defence push.

Aircraft maintenance boom has further to fly

14 Feb 2025

In 2024, stuttering production of new jets saw repairs of older models take on fresh import for the likes of Melrose and Safran. This year deliveries could rise by 25%. But supply chain uncertainty and strong flying demand mean the maintenance profit engine can continue to motor.

Orsted’s new skipper is stuck in same wind storm

31 Jan 2025

The $16 bln wind developer replaced CEO Mads Nipper with deputy Rasmus Errboe after writedowns on US investments. It may be too late to walk away from those projects. The new boss needs to better articulate the risks facing the group – and take steps to fix its balance sheet.

GM and US interests head in different directions

28 Jan 2025

The carmaker’s quarterly revenue and profit outpaced forecasts while EVs broke even by one metric. Boss Mary Barra is also bullish for 2025, but investors pushed the stock down 10%. As the $55 bln company’s AI vistas shrink and China rises, tariffs threaten its home-turf edge.

China advance creates more AI winners than losers

27 Jan 2025

The DeepSeek model’s quality and low cost has spurred a selloff in chips and energy stocks. Chinese competition may indeed hit ‘picks and shovels’ players like $3.5 trln Nvidia. But it’s not yet certain, and making AI less the domain of Big Tech may enhance its broader benefits.

Orsted’s management discount is back

21 Jan 2025

The $16 bln Danish renewables group saw shares slump 15% after new writedowns. CEO Mads Nipper can’t control rising rates, or US disdain for offshore wind. But a valuation below its operating assets implies investors once again don’t rate Orsted’s scope to forecast rising costs.

German election campaign ignores economic ills

21 Jan 2025

Europe’s largest economy shrank by 0.5% in the last two years and may stagnate in 2025. The crisis is due to structural flaws such as a lack of investment, an ageing population and a shrinking industrial base. The government that emerges from February’s poll will need to be bold.

SpaceX will be a better $1 trln bet than Tesla

26 Dec 2024

The satellite network is a nascent monopoly, more useful and harder to dislodge every day. As at his car company, boss Elon Musk is chasing growth through maniacal cost-cutting. Thing is, that works better in space. Expect SpaceX and Tesla’s relative valuations to prove it.