31.4 C
Cairo
Thursday, August 5, 2021

Economy

Wall Street urges GM and Ford spending in Tesla ‘arms race’

Investors are urging on plans by General Motors and Ford to spend tens of billions of dollars on electric vehicles, even as the carmakers capitalise on booming revenues from cars and trucks with traditional engines.GM will announce second-quarter earnings on Wednesday after saying in June that its results for the year’s first half would be “significantly better” than previously forecast, despite the semiconductor shortage that has hit the industry. Last week Ford surprised investors when it reported a $561m second-quarter profit on surging demand for trucks and sport-utility vehicles.The companies will need all the profit they can earn to meet their new goals for building factories and hiring more software and electrical engineers as they shift to manufacturing electric vehicles. In June GM again increased its planned spending on electric and autonomous vehicles, to $35bn by 2025, while Ford has committed $30bn over the same period.While the investments are smaller than they seem — some of the dollars are simply reallocated from the carmakers’ annual budgets for producing traditional vehicles — they still represent significant new money. Yet far from worrying at the impact on future earnings, analysts say investors are eager to see more spending, faster. “The Street wants to see an accelerated EV vision where more investments happen over the next two, three, four years rather than waiting to the end of the decade,” said Dan Ives, an analyst at Wedbush Securities. “It’s an arms race right now . . . There’s a fear that if they’re not aggressive enough over the coming years, they’ll be left in the dust by the likes of Tesla.”The enthusiasm is new, notes Morningstar analyst David Whiston. A few years ago investors would have punished the carmakers’ stock prices had they embraced EVs, which make up just 2 per cent of the US market.Now GM and Ford “are both investing for the future while also riding out the [internal combustion engine] as long as they can”, Whiston said. That is their advantage over Tesla: while neither Detroit company can claim a celebrity chief executive or a retail investor base to send their valuation skyrocketing, Tesla only recently began making money. GM and Ford have profits from traditional vehicles to plough into battery-powered ones.About a third of GM’s $35bn goes toward engineering and two-thirds toward capital expenditures. The company is expanding assembly capacity at three factories located in Michigan, Tennessee and Ontario, Canada, with more to be announced later. Electric vehicles are built using different tooling than traditional vehicles, which must be purchased and installed.Ford, too, is expanding capacity, with $700m going to outfit its River Rouge complex in Michigan.GM is building four battery cell plants in the US, with factories already under construction in Lordstown, Ohio and Spring Hill, Tennessee. Battery plants are more expensive than assembly plants. They require enormous amounts of electricity to operate as batteries must be charged and drained to “cure” them before they can be placed in cars and trucks.GM and Ford also will need to spend money to change the composition of their workforce, said Gartner analyst Michael Ramsey. They still need mechanical engineers, but fewer of them, while software and electrical engineers are in demand.The companies are “unquestionably double counting” a portion of the dollars in their EV investments, including dollars for capex and research that already are included in the company’s total expenses, Ramsey said. In 2019 GM’s expenses totalled $132bn but they will not automatically jump to $138bn annually over the six-year period covered by its $35bn spending commitment. Instead, some of the dollars currently allocated to petrol-powered vehicles will be redirected toward EVs.The investments “are substantial, and they are probably spending additional money”, Ramsey said, but “these companies are not going to go $30bn in debt to invest in electric vehicles. They’re going to take their existing pot of money and reallocate it a bit.”

Technology

Well benig

The irony of an International Water Conference in Lagos

The Lagos State government on 23 June 2021, threw its doors open to welcome delegates from different parts of the world. The goal of the conference was to facilitate the efficiency of the water sector in the state. But when asked, a typical Lagosian like Isaac Moses said that the last time he drank water supplied by the state’s water corporation was in 1999, when the public water works close to his old compound used to function. The pipes that connect this precious liquid to his compound have remained broken and rusty. Since then, his major source of drinking water has come from boreholes. Lagos is an island city surrounded by water yet, there is very little for the population to drink. At the water conference, the Governor of the State, Babajide Sanwo-Olu disclosed that less than 40 percent of the residents have access to potable water. The World Population Review estimates the population of Lagos at above 14 million. In other words, less than 7 million Lagosians have access to potable water. As of 2016, Lagosians needed as much as 724 million gallons to function efficiently, but the state could only manage to provide 317 million gallons, leaving a gap of 407 million gallons. At the conference, Sanwo-Olu said the state has yet to resolve its sufficiency problem. The Lagos State Water Supply Master Plan said that, current water demand stands at about 540 million gallons daily (MGD) but the Lagos Water Corporation (LSWC) can only produce 210 MGD. Read Also: A case for tackling challenge of potable water supply in Lagos Sadly, not all the 210 gallons of water reach households due to perennial fractures from dilapidated transmission pipes and old trunk lines. Also, the water supply is very erratic and frequently subject to prolonged outages. For the over 8 million Lagosians without access to potable water, it is a public health threat. It is also a threat to environmental sanitation, a challenge the state has failed to address. Apart from that, residents in the state are left with no choice but to provide water for themselves with boreholes. The LSWC estimates that there are up to 200,000 such boreholes across Lagos State. Interestingly, even when they use their money to provide themselves water to drink, some agencies of the state penalise them for it with illegal levies. We believe that with efficient management, Lagos easily can surpass its water target and even position itself as the primary market for supplying potable water to other states in the country. The solution can start from revisiting the Lagos Water Master Plan 2010-2020. One of the failures of that plan was the government’s fixation on funds to revamp water infrastructure. In the current economic climate raising $2.5 billion which is the target, from the state’s budget may not be visible. However, the government can take a different tack to water production, and positioning the sector in such a way that investors can see the value in investing capital, would be a way to address the poor infrastructure. While the proliferation of boreholes has provided some respite for residents, the state requires a permanent fix to the water crisis. This is especially given that borehole drilling is widely unregulated and most of the water that people get from them is contaminated. This is where we think the plan to licence borehole drilling has its merits. Nevertheless, it requires transparency and the goal must be to help Lagos residents get the best portable water. In that sense, licensing should not be an avenue to extort and make access to drinkable water difficult, rather it should be a way to monitor the quality of the water people will drink. It should also be a way to help people live a quality life. After all, as the late afro-beat crooner said, “Water does not have an enemy.”

‘Spiritual opium,’ Facebook, and the metaverse: An alternate reality on the rise

<!-- (function(w, l){ w=w||; w.push({ 'gtm.start': new Date().getTime(),

India’s highest court weighs Pegasus phone snooping inquiry

India’s Supreme Court will on Thursday hear journalists’ petitions for an independent, court-supervised investigation into allegations that Prime Minister Narendra Modi’s government misused spyware to surveil opposition politicians, journalists and officials.Traces of NSO Group’s Pegasus software were found on the smartphones of Prashant Kishor, an opposition political strategist, and seven Indian journalists during a recent global investigation by a media consortium into the use of the Israeli-made surveillance tool.The phone numbers of dozens of other prominent Indian public figures, including Congress party leader Rahul Gandhi, other opposition politicians, a former election commissioner and officials, and a well-connected businessman, also appeared on a global list of 50,000 people who had allegedly been targeted for potential surveillance by NSO Group’s clients since 2016.The allegations of widespread snooping on high-profile Indian citizens have unleashed a political storm that some commentators have compared to the 1970s Watergate scandal that cost Richard Nixon his job as US president.Pegasus’s maker claims that it sells its military spyware only to “vetted governments” for national security, counter-terrorism and law enforcement. In the weeks since the revelations, Indian journalists and media organisations have filed a number of petitions appealing to the Supreme Court to set up an independent investigation to establish the truth — and determine who authorised any snooping. “It’s not just a matter of my privacy. It’s not just a question of my freedom of expression,” said one of the petitioners, Paranjoy Guha Thakurta, a veteran journalist whose phone was allegedly compromised by Pegasus. “It raises fundamental questions of the future of the democratic system — not only in India but across the world.”The Editors Guild of India this week filed public litigation. It argued that the alleged use of Pegasus to spy on journalists raised “grave concerns of abuse of office, dismantling of separation of power, infringement of fundamental right to privacy, freedom of speech and expression, and freedom of the press, subversion of the democratic process, and commission of serious criminal offences”.Modi’s government has refused to either confirm or deny whether it is using the Israeli software, although cabinet ministers have insisted that no illegal surveillance has taken place.Government officials and members of Modi’s ruling Bharatiya Janata party have boycotted a hearing into the use of Pegasus by parliament’s standing committee on IT, which is led by Congress lawmaker Shashi Tharoor, in a move which in effect stalled that line of inquiry. “It is clear what has occurred was a crime, but you have seen absolutely no attempts by the central government to investigate it,” said Raman Jit Singh Chima, Asia-Pacific policy director of Access Now, a global digital rights organisation. “They are seeking to use any tool they can to frustrate inquiries into the Pegasus Project revelations.”Privacy activists and digital rights groups have become concerned by New Delhi’s surveillance of its citizens. In late 2019, WhatsApp notified two dozen Indian activists, scholars and politicians that their phones had been hacked by commercial Israeli spyware. The only entity New Delhi blamed was WhatsApp.“Of all the democracies that we are tracking globally, we are most concerned by the surveillance impunity problem in India,” Chima said. “It’s happening on a massive scale, with even less pretence of conducting an independent inquiry or ensuring this does not happen again.”

Technology

As China's recovery wobbles, economists expect more policy easing

Nomura lowered its China GDP growth forecast on Wednesday to 5.1% in the third quarter and 4.4% in the fourth quarter, from 6.4% and...

Northleaf Expands Business Development Team With the Addition of Chris O’Connor as a Managing Director for Australia and New Zealand

TORONTO — Northleaf Capital Partners (Northleaf) is pleased to announce the appointment of Chris O’Connor as Managing Director, Business Development, Australia and New Zealand. In this new role, Chris will lead Northleaf’s business development and investor relations activities and further develop relationships with institutional investors, consultants and advisors in the region. Chris joins Northleaf’s existing […]

Canadian dollar dips for 4th day as oil prices slide

TORONTO — The Canadian dollar edged lower against its U.S. counterpart on Wednesday along with a two-week low for oil prices, but the currency stuck to a narrow range ahead of key economic data through the rest of the week. The loonie was trading 0.1% lower at 1.2550 to the U.S. dollar, or 79.68 U.S. […]
200,000FansLike
200,000FollowersFollow
200,000FollowersFollow
- Advertisement -

Most Popular

Fitness

Most Asian currencies muted; baht, Taiwan dollar gain

The following table shows rates for Asian currencies against the dollar at 0156 GMT. CURRENCIES VS U.S. DOLLAR Change on the day at 0156 GMT Currency Latest bid Previous Pct day Move Japan yen 109.650 109.47 -0.16 Sing dlr 1.351 1.3508 +0.01 Taiwan dlr 27.780 27.833 +0.19 Korean won 1143.800 1143.6 -0.02 Baht 33.080 33.12 […]

Thales Partners with DAS in Fully Supporting Hong Kong International Airport’s Three-Runway System Expansion Project

Thales partners with DAS to provide an advanced Instrument Landing System (ILS) solution in fully supporting the Three-runway System (3RS) expansion project at the Hong Kong International Airport (HKIA) helping to further improve the capacity and efficiency of aircraft landing while maintaining the highest standard of flight safety. As one of the most trusted partners, […]

Thailand reports record 20,920 coronavirus cases in a day

BANGKOK — Thailand reported on Thursday a record 20,920 coronavirus cases, bringing total cases in the Southeast Asian nation to 693,305 since the pandemic began last year. It also reported 160 additional fatalities, bringing total deaths to 5,663, the health ministry’s website showed. (Reporting by Chayut Setboonsarng; Editing by Muralikumar Anantharaman)

Chile’s dictatorship-era water code is getting a makeover

SANTIAGO — Chilean lawmakers took further votes on Wednesday to overhaul the country’s dictatorship-era water code, aiming to replace decades-old legislation that largely privatized water rights with a new code that prioritizes human consumption and the environment. The reform bill, which has languished in Congress for 10 years, has made big strides thus far in […]

How NCAT is repositioning Nigeria’s Aviation industry for growth in changing times

<!--How NCAT is repositioning Nigeria’s Aviation industry for growth in changing times - Businessday NG<!-- --><!--end of Amp adsense

Gaming

Most Asian currencies muted; baht, Taiwan dollar gain

The following table shows rates for Asian currencies against the dollar at 0156 GMT. CURRENCIES VS U.S. DOLLAR Change on the day at 0156 GMT Currency Latest bid Previous Pct day Move Japan yen 109.650 109.47 -0.16 Sing dlr 1.351 1.3508 +0.01 Taiwan dlr 27.780 27.833 +0.19 Korean won 1143.800 1143.6 -0.02 Baht 33.080 33.12 […]

Latest Articles

Most Asian currencies muted; baht, Taiwan dollar gain

The following table shows rates for Asian currencies against the dollar at 0156 GMT. CURRENCIES VS U.S. DOLLAR Change on the day at 0156 GMT Currency Latest bid Previous Pct day Move Japan yen 109.650 109.47 -0.16 Sing dlr 1.351 1.3508 +0.01 Taiwan dlr 27.780 27.833 +0.19 Korean won 1143.800 1143.6 -0.02 Baht 33.080 33.12 […]

Thales Partners with DAS in Fully Supporting Hong Kong International Airport’s Three-Runway System Expansion Project

Thales partners with DAS to provide an advanced Instrument Landing System (ILS) solution in fully supporting the Three-runway System (3RS) expansion project at the Hong Kong International Airport (HKIA) helping to further improve the capacity and efficiency of aircraft landing while maintaining the highest standard of flight safety. As one of the most trusted partners, […]

Thailand reports record 20,920 coronavirus cases in a day

BANGKOK — Thailand reported on Thursday a record 20,920 coronavirus cases, bringing total cases in the Southeast Asian nation to 693,305 since the pandemic began last year. It also reported 160 additional fatalities, bringing total deaths to 5,663, the health ministry’s website showed. (Reporting by Chayut Setboonsarng; Editing by Muralikumar Anantharaman)

Chile’s dictatorship-era water code is getting a makeover

SANTIAGO — Chilean lawmakers took further votes on Wednesday to overhaul the country’s dictatorship-era water code, aiming to replace decades-old legislation that largely privatized water rights with a new code that prioritizes human consumption and the environment. The reform bill, which has languished in Congress for 10 years, has made big strides thus far in […]

How NCAT is repositioning Nigeria’s Aviation industry for growth in changing times

<!--How NCAT is repositioning Nigeria’s Aviation industry for growth in changing times - Businessday NG<!-- --><!--end of Amp adsense

The face of justice in Nigeria

Abba Kyari On December 12, 2015, some members of the Islamic Movement of Nigeria (IMN) were doing their normal procession in Zaira and blocked the convoy of the then Chief of Army Staff, Lt. Gen. Tukur Burutai. After some altercations, the army promptly mowed them down and for added measure, levelled their Hussainiyya centre, brutalised and arrested… Don’t miss another story Become a BusinessDay Subscriber today. For insights, facts, figures, and access to opportunities.Options starting from N1000 Monthly Subscribe Now Already a subsriber? Login Get real time updates directly on you device, subscribe now. Subscribe

Must Read