Transportation

Singapore looks boxed in with Li Ka-shing

9 Jan 2023

Co-investing with Hong Kong’s top tycoon once seemed like a no-brainer but sovereign fund Temasek may sell its 20% of CK Hutchison’s ports business. It owns a hefty slug of the company’s retail unit too. Geopolitics complicate any exit from these bold private investments.

Capital Calls: Southwest, U.S. jobs and wages

6 Jan 2023

Concise views on global finance: Financial bumpiness caused by the airline’s major flight disruptions should be temporary, partly due to limited competition; slower U.S. wage growth raises the chances that the Fed won’t have to crush the labor market to bring down inflation.

Capital Calls: Amazon, Flying cars

5 Jan 2023

Concise views on global finance: The $855 billion e-commerce giant's layoffs could actually help its antitrust defense; Stellantis’s possible $150 mln investment in Archer Aviation is less crazy than it seems.

Scooterverse collides with financial reality

16 Nov 2022

Bird’s scooter-share business attracted investors on the understanding that it would disrupt transportation and eventually turn a profit. It got part way there, but the capital markets seized up before Bird really got going. Even good ideas can run out of road.

Net zero woes go beyond lack of global cooperation

20 Sep 2022

The International Energy Agency frets that poor collaboration between states will keep emissions high. But the struggles of green groups like ITM Power suggest countries aren’t doing enough to help domestic markets either. Energy policy needs to do more than fight today’s crisis.

Capital Calls: Electronic Arts’ M&A game

26 Aug 2022

Concise views on global finance: The publisher of the popular FIFA franchise is an attractive target but few buyers may be on the board.

Maersk’s cash machine is economic storm warning

2 Aug 2022

The Danish shipping giant reckons sky-high freight rates will help it land $37 bln of EBITDA this year. The trouble is its $50 bln enterprise value gives little credit to what lies over the horizon. The likely explanation is a sharp collapse in container demand due to recession.

GE is fine, it’s everyone else that’s the problem

26 Jul 2022

Inflation, war and supply problems knocked 5% off the industrial firm’s second-quarter revenue and about one-fifth off its profit. In turn, GE boss Larry Culp will miss a key cash-flow target. If not for Culp’s tireless tinkering under the hood, though, things would be worse.

Capital Calls: Royal Mail, Europe’s chip champion

20 Jul 2022

Concise views on global finance: Britain’s postal provider is eyeing a potentially messy separation, but a nationalisation would make more sense; shares of ASML, which provides cutting-edge machines for chipmaking, look more appealing despite inflation and geopolitical worries.

China’s great outdoors opens up for business

19 Jul 2022

Tired of lockdowns and wary of Covid contagion, citizens are embracing camping, glamping and recreational vehicles. For now, the market is tiny compared to the $700 bln U.S. industry. It’s a great opportunity for foreign brands to pitch their tents in a fast-growing luxury space.

Cathay Pacific charts hopeful course for Hong Kong

18 Jul 2022

Huge capacity cuts and a bailout put a lid on debt as quarantine rules keep its home city isolated. Its shares, better performing than Singaporean and Western peers, imply the airline and the Asian hub will make a quick turnaround. But it faces a harder slog back to normal.

Americans’ urge for the open road knows few bounds

1 Jul 2022

Travelers book flights for convenience – and in theory rising gas prices help that trend. But time is money, too, and plane delays are increasing. Assign a reasonable value for an airport setback, and it suggests holiday travelers should blare "Holiday Road."

Capital Calls: Antitrust cops’ quixotic PE warning

14 Jun 2022

Concise views on global finance: Competition chief Lina Khan is using a run-of-the-mill deal to issue a broadside against private equity – but it’s unclear what these tough words mean in practice.

Capital Calls: Ford wisely trims its electric bets

9 May 2022

Concise views on global finance: The Detroit automaker is selling part of its stake in stumbling electric startup Rivian, just as its own costly electric turnaround takes hold.

Uber’s CEO has right idea, wrong valuation

9 May 2022

Boss Dara Khosrowshahi said he’s focused on cutting costs to up free cash flow. That sounds like a great idea. The trouble is Uber’s $50 billion valuation is too high even assuming better margins. And it’s harder to square if top line growth slows when expenses are slashed.

Rising costs put U.S. auto revamp in a jam

29 Apr 2022

Prices of cars from makers like Ford and GM are up by 13% in a year. But higher costs have caused profits to stagnate. Revamping businesses away from combustion engines is expensive, and adds pressure. They have few levers to pull, and little cushion to fund change.

Stranded jets are least of plane lessors’ problems

14 Apr 2022

Big fleet-owners like AerCap may have to write off $10 bln of planes trapped due to Russian sanctions. Ultimately, though, insurers should cover their losses. A bigger brake on the aircraft-leasing industry’s rapid ascent is the rising cost of debt from jittery lenders.

Capital Calls: Buffett’s HP bet, Gambling M&A

7 Apr 2022

Concise views on global finance: Berkshire Hathaway takes a hefty stake in the computer and printer maker; Betting group 888 negotiates a better price for buying UK bookie William Hill.

Russian yachts stranded in choppy sanctions waters

1 Apr 2022

France, Italy and Britain have grabbed headlines by seizing luxury cruisers linked to sanctioned oligarchs. But proving ownership is tricky, while keeping the expensive boats afloat may require state money or navigating complex rules. Selling them will be an even rougher voyage.

Capital Calls: Chip supply chain bites own tail

31 Mar 2022

Concise views on global finance: Semiconductor factories rely on machines made by ASM International. Paradoxically, the firm is having trouble finding the chips it needs. Untangling the mess will take a while.