[ad_1]
But that doesn’t faze Wall Street, which remains focused on investing in electric vehicles that could fuel future growth.
“The persistent nature of the microchip shortage and port congestion problems continue to constrain the entire industry,” said Dave Gardner, director of Honda, in a statement.
Break it down: Automakers say demand for vehicles remains strong, even though prices have hit record highs. The average new vehicle in the United States sold for $ 43,355 in August, according to Kelley Blue Book. This is 10% more than a year ago.
“Underlying demand conditions remain strong, thanks to the many job openings, the growing demand for turned back vehicles and the excess savings accumulated by many households during the pandemic,” said GM’s chief economist. , Elaine Buckberg.
Yet automakers had to idle factories for months as they scrambled to get the necessary parts, a problem they hoped was now behind them. This weighs on deliveries.
Investors are doing their best to look past recent developments. GM shares rose nearly 8% in September, while Ford climbed nearly 9%. The First Trust Nasdaq Global Auto Index Fund, which tracks the industry, has fallen over the past two months, but remains nearly 12% higher this year after rising 53% in 2020.
Why? Call it faith in the future of the electric car.
Ford last week announced it was investing $ 7 billion to build two massive manufacturing campuses in Kentucky and Tennessee for electric vehicles. GM, which has scheduled an investor presentation later this week, is also expected to hammer out its electric vehicle strategy (despite a recall of its Chevy Bolt to tackle fire-prone battery cells).
“With the chip shortage, a major overhang for the automotive space and logistical challenges globally, these delivery figures were ‘mind blowing’,” Wedbush Securities analysts Daniel Ives and John Katsingris said in a note. of research. Tesla’s deliveries reveal “fairly robust” demand for electric vehicles by the end of 2021 and next year, they added.
The big picture: At the end of 2020, there were 10 million electric cars on the roads around the world, according to the International Energy Agency. That number could reach nearly 145 million by 2030, if governments follow through on plans to boost adoption.
Automakers are scrambling to lead this transition, while Wall Street is betting it will trigger a windfall. But that requires looking beyond the current conditions, which remain extremely difficult for most businesses.
Evergrande’s action halted amid reports of new deal
Evergrande shares were suspended on Monday over reports that a rival Chinese property developer was preparing to buy its property management arm.
If such a deal comes to fruition, it could give the struggling conglomerate access to much-needed cash, reports my CNN Business colleague Michelle Toh. It may not yet be enough.
The latest: Cailian News, a state-owned media outlet, reports that Hopson Development is considering taking a 51% stake in Evergrande’s property management business, valuing it at more than $ 5 billion.
Hopson shares were also suspended in Hong Kong on Monday due to a “pending” announcement related to a major acquisition. The company said it “will not comment on market rumors.”
Take a step back: Evergrande is looking for buyers for some of its businesses as it struggles to survive a cash shortage. The conglomerate is China’s most indebted developer, with more than $ 300 billion in liabilities.
It has likely missed two bond payment deadlines in recent weeks, raising concerns of an impending collapse that could reverberate globally. Evergrande’s stock has slumped 80% so far this year.
Look at this space: the company seems to prioritize its domestic debt over what it owes to foreign investors. He is also under enormous pressure from Beijing to protect the people who bought his apartments and have not yet taken possession of them.
The Chinese government is still expected to intervene to limit the fallout from Evergrande’s financial difficulties. But there is still a lack of clarity on how this might play out.
“There is still very little visibility from the Chinese government on the fate of Evergrande, although a slow and steady dismantling of the company appears to be the preferred route at this time,” said Jeffrey Halley, analyst at senior market for Asia-Pacific in Oanda. a note to customers on Monday.
Corporate vaccine mandates are growing in popularity
Recent surveys by the healthcare think tank Kaiser Family Foundation and Gallup revealed greater support for terms compared to previous polls, reports my CNN Business colleague Chris Isidore.
KFF, who spoke to 1,500 people in mid-September, said the majority of respondents supported vaccine requirements for healthcare workers, teachers and federal government employees, while that nearly six in 10 supported the Biden administration’s new mandate that large employers demand vaccines. or order weekly tests.
Gallup, which also conducted a survey last month, found that 58% of employees supported vaccination mandates, up from 52% in July and August and 49% in June.
On the radar: Employer vaccination mandates appear to be effective in increasing vaccination rates. United Airlines said last week that only 593 of its employees could be made redundant for failing to meet its vaccine requirements. That’s less than 1% of its 67,000 American workers who are covered by the rule.
More and more airlines, including American Airlines and JetBlue, are following suit, as the US government requires vaccines for all employees of federal government contractors without testing alternatives.
“While we are still working on the details of the federal requirements, it is clear that team members who choose to remain unvaccinated will not be able to work at American Airlines,” CEO Doug Parker said in a note to employees on Friday. .
Following
Also today: The Organization of the Petroleum Exporting Countries meets by video conference to discuss crude production. The increase in production could hamper a recent rise in prices.
[ad_2]
Source link