Manufacturing

Despite help from SUVs, GM still isn’t there yet

25 Jul 2017

The $54 bln U.S. automaker made more money than expected in the second quarter thanks to a shift from cars towards trucks and crossovers. Now, though, it’s making too many smaller vehicles. After exiting unprofitable overseas markets, CEO Mary Barra has to slim down at home, too.

Ford’s new driver veers back onto old road

20 Jun 2017

Jim Hackett is shifting production of the Focus compact to China from Mexico. The move risks angering President Trump but it’s a smart use of capital and a sign globalization isn’t dead. It’s also ex-CEO Mark Fields’ idea, proof there’s no quick fix for what ails the automaker.

Hexagon would be a pointy-edged takeover target

14 Jun 2017

At a price of almost $20 bln, the Swedish manufacturing software group offers a poor return for a buyer. That may not deter a rival such as ABB tooling up for the switch to automated factories. If globalisation goes into retreat, such a deal could even prove forward-thinking.

Viewsroom: CEO presidency needs boardroom pushback

17 May 2017

Donald Trump’s promise to run the government like a business is proving difficult but Congress could act like strong independent directors to rein in his wayward management.  China’s ambitious Silk Road project could leave its people holding the bag. Plus: job cuts at Ford.

Safran can wiggle out of Zodiac mess in own time

28 Apr 2017

The French engine maker clearly needs to reduce or scrap its 8.2 billion euro bid for the plane-seat maker. The current offer, a third above Zodiac’s share price, is financially and politically daft. But there’s no rush to renegotiate. Clever timing might produce a better result.

Ericsson turnaround has a static problem

25 Apr 2017

The Swedish telecoms kit maker made a $1.4 billion first-quarter operating loss after provisions and writedowns announced in March. New boss Borje Ekholm has the right strategy. But investors will still fret about further nasty surprises and a lack of progress on non-core sales.

Review: The demise of unions and the rise of Trump

11 Apr 2017

The new Broadway hit "Sweat," about a Pennsylvania steel plant’s closure, offers insight into the forces that put the U.S. president in office. Yet economic insecurity need not necessarily have fueled nativism. The dwindling power of organized labor is a compelling contributor.

Review: A flawed compass for post-Brexit Britain

31 Mar 2017

The vote to leave the European Union exposed a new political fault line, David Goodhart argues in “The Road to Somewhere”. The solution is for cosmopolitan elites to share more power with those left behind. The tension is real, but the distinction too broad to be a useful guide.

Luxury watch deal builds on Hong Kong shell pile

1 Mar 2017

Luxury watch retailer Hengdeli wants to sell its prized China business to its chairman and leave stakeholders Swatch and LVMH with a gutted listed entity. Proliferating empty shells is a real problem in Hong Kong. Better to force a buyout, or block such sales.

Insurgency is logical byproduct of Alcoa spinoff

1 Feb 2017

Alcoa coped with an irrational aluminum market by plowing capital into expensive acquisitions. Management hoped a separation would attract investor attention to its Arconic parts business, and provide a cozy escape hatch. It got what it wanted – but in the form of a proxy fight.

Detroit can power-steer around political obstacles

26 Jan 2017

The new president wants more U.S. factories and jobs. In theory that could cost the car industry $60 bln-plus. But Ford and GM have spare capacity and good PR folks. Other Trump policies should help carmakers, too. They can turn connected and driverless tech to their advantage.

Foxconn’s $7 bln U.S. bet goes beyond politics

23 Jan 2017

Building a huge American factory would fit neatly with President Trump's push to create domestic jobs. That could help the Taiwanese iPhone maker navigate trade disputes. Grabbing a share of the U.S. television market could also help revive recently acquired subsidiary Sharp.

GE’s succession path lit by dueling deals

29 Dec 2016

The $275 bln industrial giant has a long list of executives capable of taking over when Jeff Immelt retires. In addition to engines and turbines, GE manufactures CEOs. The progress of two major M&A transactions will give the board a clearer view in 2017 on who should get the job.

Mr. Market is way ahead of next U.S. president

9 Nov 2016

Donald Trump's economic plans have been sparse on detail. Investors are filling in the blanks themselves. Caterpillar and Vulcan leapt on an expected infrastructure boom. For-profit prisons and schools are back in vogue. Ford, Amazon, Whirlpool - firms Trump shamed - not so much.

Baker Hughes investors overly pessimistic about GE

31 Oct 2016

Shares of the oilfield-services firm tumbled after announcing a merger with GE's oil and gas unit. Shareholders get a $7.4 bln special dividend and a big stake in an industry leader. But having been burned before, Baker's owners have their reasons for discounting GE's promises.

Ford’s messy quarter is a slowdown, not a crash

27 Oct 2016

Weaker sales contributed to the 56 pct drop in the carmaker's third-quarter earnings. But so did recalls and other funnies. Strip those out and the Mustang maker's margins are healthier than they look. The rally in U.S. vehicle sales may be over, but the off-ramp is manageable.

Tesla’s surprise profit paves way for more capital

26 Oct 2016

Elon Musk's electric-car maker moved back into the black. The small Q3 income could help investors see clear to approving the silly SolarCity deal. Tesla and Musk also have sent mixed signals about needing fresh money, but now would be as good a time as any to try and top up.

GM rides cruise control to top of auto cycle

25 Oct 2016

A strong third-quarter showing extended the smooth ride Detroit's top carmaker is having as U.S. sales peak. Ford's engine, meanwhile, is already sputtering. GM may even have a bit more gas in the tank. CEO Mary Barra, though, may find that the going will soon get tougher.

Bayer upstaged by its unloved plastics spinoff

25 Oct 2016

Plastics maker Covestro’s share price has doubled in the past year whereas that of its former parent is heavily weighed down by the pricey acquisition of U.S. seed maker Monsanto. Their divergent destinies are a lesson in how focus can beat a restless hunger for mega-deals.

Rockwell’s smart-jet hopes crash into reality

24 Oct 2016

Investors wiped up to 6 pct off the avionics supplier's stock after it agreed to pay $6.4 bln for seatmaker B/E Aerospace. Rockwell is betting the tie-up will win it a larger share of commercial airlines' digital transformation. The market for new planes, though, is stalling.