Manufacturing

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.

US Steel veto is pandering as industrial policy

3 Jan 2025

President Biden nixed the company’s $15 bln sale to Nippon Steel. The aged blast furnaces that drove political outcry now risk closure or sale to a domestic rival, which could raise prices. Bipartisan protectionism combined with favoritism may simply leave most people worse off.

Smart glasses give tech giants dangerous FOMO

30 Dec 2024

Sales of Meta’s $300 Ray-Bans that let wearers snap pictures and talk to a virtual assistant have topped 1 mln shipments. Advances in AI, chips and software mean rivals from Amazon to Baidu will roll out high-tech specs too. But all will struggle to catch sight of profit.

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.

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.

India’s slowdown flashes an early-warning signal

2 Dec 2024

GDP growth slipped to 5.4% last quarter, the slowest pace in nearly two years, on weak manufacturing and spending. Perhaps it’s a blip. But the Adani fallout, Trump tariff threats and China stimulus could all deal blows to rosy assumptions about the world’s fifth-largest economy.

European pharma’s growth prescription: pivot to US

28 Nov 2024

Novartis, Novo Nordisk and regional rivals lost $86 bln in value over concerns about tariffs and other possible measures by President-elect Donald Trump. Stateside M&A and manufacturing moves could ease the pain and boost revenue. But hopping across the pond will mean paying up.

An $11 bln concrete deal is about unset options

25 Nov 2024

Quikrete is buying building materials peer Summit at a so-so multiple, despite a rush of subsidy-bolstered US construction. If the pace keeps up amid easing interest rates, it’s smart vertical integration. If a new Trump era wrecks that forecast, there are obvious units to sell.

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.

ASML’s sunny AI destination has a cloudy roadmap

15 Nov 2024

The $270 bln semiconductor equipment maker has stuck to its 2030 sales guidance, thanks to growing data centre needs. But chipmakers’ strife, politics, and weak smartphone demand remain near-term headaches. Investors may like ASML’s destination, but the route there looks bumpy.

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.

Grim VW numbers give CEO a mandate for shake-up

30 Oct 2024

The 46 bln euro carmaker reported a 21% year-on-year operating profit slump in the first nine months of 2024. That may help boss Oliver Blume push through a restructuring of its ailing core brand. It’s a necessary but risky move, and other problems, like China, are getting worse.

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.

Tesla gives its faithful just enough good news

23 Oct 2024

Shares in Elon Musk’s $700 bln carmaker surged as operating profit rose 54%. That owes more to cost cuts than growth, but along with heady sales predictions, it overshadowed a disappointing robotaxi reveal. The rub is whether that’s enough to justify investors getting charged up.

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.

Boeing cash patch will be ripped off

15 Oct 2024

The aviation giant will raise money to fill a hole caused, most recently, by a worker strike. Debt weighs heavy and selling $12 bln in stock would help. But additional funds offset new problems, rather than fix Boeing’s plentiful existing ones. The cost of dilution will be high.