Major International Business Headlines Brief::: 22 September 2021

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Major International Business Headlines Brief::: 22 September 2021

 


 

 


 <https://www.nedbank.co.zw/> 

 


 

 


ü  Evergrande: Crisis-hit firm strikes China debt deal

ü  Pandemic has changed travel forever, says AirBnB boss

ü  Joe Biden plays down chances of UK-US trade deal

ü  China pledges to stop building new coal energy plants abroad

ü  Major record labels could face competition inquiry

ü  Gas price crisis: Government to pay millions to restart CO2 supplies

ü  Pret says midweek busiest for office worker trade

ü  Record backlog of cargo ships at California ports

ü  Catalogue of errors led to £1bn of state pension underpayments

ü  Failing energy firms may mean higher bills, warns regulator

ü  'No clear end to HS2 cost and delays' say MPs

ü  German elections: Businesses face future without Merkel

ü  Salesforce rival Freshworks raises $1.03 bln in U.S. IPO, valued at
$10.13 bln

ü  Facebook wraps up deals with Australian media firms, TV broadcaster SBS
excluded

ü  German auto giants place their bets on hydrogen cars

 

 

 

 

 


 <mailto:info at bulls.co.zw> 

 


 

Evergrande: Crisis-hit firm strikes China debt deal

The main property unit of Chinese real estate giant Evergrande has said it
has struck a deal over a bond interest payment which is due on Thursday.

 

The amount due for the domestic bond is estimated to be $35.9m (£26.3m).

 

The announcement will offer some relief to investors concerned over the
company's debt crisis.

 

However, the world's most indebted developer is also due to make a $83.5m
interest payment on an overseas bond on Thursday.

 

In a statement filed with the Shenzhen Stock Exchange in mainland China,
Hengda Real Estate Group said it had reached an agreement with holders of
the onshore bond over the repayment.

 

However, the statement did not reveal how much interest would be paid or
when any payment would be made, saying only that the bond "has already been
resolved through private negotiations".

 

The filing also did not mention the offshore bond.

 

Under agreements with investors, the company has a 30-day grace period
before a missed payment on the offshore bond would become a default.

 

The firm's problems have sent shockwaves around global markets over concerns
it may be about to collapse.

 

Evergrande has been struggling to meet repayments on its debts of more than
$300bn.

 

Earlier in the week, the company started to repay investors in its wealth
management business with property as it struggled to find cash to meet its
liabilities.

 

On Monday, Evergrande also reportedly missed interest payments to at least
two of its biggest lenders.

 

Some analysts have cautioned that the failure of such a large and
heavily-indebted property developer could have a major impact on the Chinese
economy, which could potentially spread to the global financial system.

 

The Shenzhen Stock Exchange, which was closed on Monday and Tuesday, was
around 0.7% lower in Wednesday's trade.

 

The Hong Kong Stock Exchange is closed on Wednesday for the annual
mid-autumn festival.-BBC

 

 

 

Pandemic has changed travel forever, says AirBnB boss

The way people travel has been changed forever by the pandemic, the boss of
lodging platform AirBnb has said.

 

Brian Chesky told the BBC the lines between business and leisure travel are
increasingly blurring thanks to remote working patterns.

 

And he said people are opting for longer breaks with family and friends as
they seek more "human connection".

 

"I think that what we're seeing today is an entire revolution in how we're
travelling," Mr Chesky said.

 

"We used to live in one place - our house - go to another place - the office
- and travel to a third place. And now all three of those places are
converged," he added.

 

"All we have to believe is that employers aren't going to force all people
to come back to the office five days a week to know that everything has
changed forever."

 

AirBnB was hit hard when the pandemic struck, losing about 80% of its
business in a matter of months.

 

Yet Mr Chesky said demand had come back strongly since last summer, while
consumer habits had changed.

 

Zoom and other technologies that enable remote work had "fundamentally
altered" the need to travel for work, he said - a pattern likely to stick.

 

Instead people were choosing to live and work away from home, not just for a
few days or a week, but "for a month or the entire summer".

 

"Some people are deciding to hop around and not even have permanent
residences," Mr Chesky said.

 

In a second big shift, he said people are seeking greater "human connection"
from travel as they spend more time alone working from home.

 

In the US, extended weekend bookings by families on AirBnB were up 70% in
the second quarter of 2021 versus 2019.

 

And the company has seen "measurable increases" in nights booked for larger
listings and family trips this year.

 

New and cheaper destinations

As a consequence, Mr Chesky said people were trying out new and cheaper
destinations, and focusing less on tourism hotspots.

 

"The world is never going back to the way it was, travel is never going back
to the way it was. It doesn't mean nothing from the old world will return,
it's just that we don't go back in time, we only go forward," Mr Chesky
said.

 

Airbnb, which was launched in 2007, also announced it had passed one billion
guest arrivals at its listings around the world.

 

It added that it now had more listings than the world's top six hotel chains
combined have rooms.

 

Despite its popularity, the lodging platform has been criticised for driving
up rents in some markets by taking long term accommodation off the market.

 

It has sparked protests in cities such as San Francisco and Barcelona, as
well as tougher regulations on short-term housing rental companies.-BBC

 

 

 

Joe Biden plays down chances of UK-US trade deal

Joe Biden has played down the chances of brokering a post-Brexit free trade
deal with the UK, as he held talks with Boris Johnson at the White House.

 

Downing Street said its priority was still getting a deal with the US alone.

 

But the BBC understands that UK ministers are now considering joining an
existing North American trade pact instead of pursuing a separate deal.

 

The two leaders also discussed Northern Ireland, climate change and
Afghanistan during the 90-minute meeting.

 

Downing Street said they "had agreed to continue working towards a future
full free trade agreement".

 

However, Mr Johnson had earlier also downplayed chances of securing a deal
with the US before the next general election, saying: "The Americans do
negotiate very hard."

 

Speaking to reporters in the Oval Office before the talks, Mr Biden said the
pair would discuss trade "a little bit", adding: "We're going to have to
work that through."

 

A deal would encourage trade by making it cheaper - usually by reducing or
eliminating taxes called tariffs.

 

A source familiar with the government's thinking suggested to the BBC that
the UK could negotiate entry into an existing trade arrangement between the
US, Canada and Mexico - known as the USMCA - set up after former US
President Donald Trump tore up its predecessor, NAFTA.

 

"There are a variety of different ways to do this," the source said. "The
question is whether the US administration is ready. The ball is in the US's
court. It takes two to tango."

 

It's really clear from both sides that there is no rapid path to a trade
deal - the opportunity that used to be lauded by Brexiteers and by President
Trump.

 

Mr Johnson hinted at that realism in his curtain raiser conversations on his
way over here.

 

And the president pretty much confirmed that here in their meeting in the
Oval Office.

 

The UK seems no longer to want to believe, or pretend, that doing business
in a major deal is top of their list.

 

Instead, while the government is still officially pursuing a stand-alone
deal with the US there's a twin track with a more incremental approach -
there have already been changes to whisky tariffs and British beef. But
Number 10 is now hopeful that the Americans are seriously considering
changing tack on British lamb.

 

Elsewhere, Downing Street said Mr Johnson and Mr Biden agreed all diplomatic
and humanitarian methods must be used to stop conditions getting worse in
Afghanistan.

 

The leaders said any international recognition of the Taliban must be
contingent on the group respecting human rights.

 

It comes amid a request by the Taliban to address world leaders at the
United Nations summit in New York this week.

 

Before the meeting, Mr Biden also issued a fresh warning to the UK that
peace in Northern Ireland must not be jeopardised as a result of
complications caused by Brexit.

 

Mr Biden made it clear he has concerns about the Irish border, amid
continuing issues with Northern Ireland Protocol - the arrangement which
helps prevent checks along the border between Northern Ireland and the
Republic of Ireland.

 

The pair also discussed the new UK, US and Australia security pact in the
Asia-Pacific, with No 10 describing it as an example of "shared values and
approach to the world".

 

The meeting - taking place on the sidelines of the UN summit - also involved
the traditional exchange of gifts.

 

Mr Biden gave the prime minister a framed photo of their first meeting in
Cornwall at the G7 summit in June, and a White House branded watch,
according to officials.

 

Mr Johnson gave the president a signed copy of a book written by British
astronaut Tim Peake with an inscription expressing hopes that it "provides a
reminder of what we're fighting to save as our countries tackle climate
change together".

 

The prime minister's gift comes weeks ahead of the COP26 climate summit,
which is seen as a crucial moment to bring climate change under control.

 

Earlier, Mr Biden announced the US would double its climate finance pledge
and increase funding for developing countries to $11.4bn (£8.3bn) by 2024.

 

Mr Johnson said the US had "stepped up to the plate" with what he called a
"massive contribution" towards the $100bn goal for countries to raise.-BBC

 

 

China pledges to stop building new coal energy plants abroad

China will not build new coal-fire projects abroad, a move that could be
pivotal in tackling global emissions.

 

President Xi Jinping made the announcement in his address at the United
Nations General Assembly.

 

China has been funding coal projects in countries like Indonesia and Vietnam
under a massive infrastructure project known as the Belt and Road
initiative.

 

But it has been under pressure to end the financing, as the world tries to
meet Paris climate agreement targets.

 

"China will step up support for other developing countries in developing
green and low-carbon energy, and will not build new coal-fired power
projects abroad," Mr Xi said in a video recording at the annual summit.

 

No further details were provided, but the move could limit the expansion of
coal plants in many developing countries under China's Belt and Road
Initiative (BRI).

 

 

The BRI has seen China fund trains, roads, ports and coal plants in numerous
countries, many of them developing nations. For the first time in several
years however, it did not fund any coal projects in the first half of 2021.

 

China is also the world's largest greenhouse gas emitter and is heavily
reliant on coal for domestic energy needs.

 

Mr Xi mentioned promises made last year about China achieving peak emissions
before 2030 and then transitioning to carbon neutrality by 2060.

 

China sets surprise 2060 carbon neutrality goal

The US Climate Envoy John Kerry welcomed the announcement, saying in a
statement that he was "absolutely delighted to hear that President Xi has
made this important decision".

 

The head of the COP26 United Nations Climate Change Conference due to be
held in Scotland next month also applauded the news.

 

"It is clear the writing is on the wall for coal power. I welcome President
Xi's commitment to stop building new coal projects abroad - a key topic of
my discussions during my visit to China," Alok Sharma said on Twitter.

 

This is the announcement that China has increasingly been expected to make.

 

For nearly a decade now coal fired power stations have been a key feature of
Xi Jinping's awkwardly named Belt and Road Initiative of foreign investment.

 

However, the reality is that the number of these projects has fallen
significantly.

 

Crucial details will need to be cleared up; when will this take effect? Will
it cover new power plants approved but not yet built? Will China also stop
financing new coal fired power stations abroad?

 

This is progress, but it's the low hanging fruit in terms of China's
addiction to coal.

 

Half the coal burned in the world is burned in China. It is still adding
numerous new coal power plants at home, with a lifespan of 40 to 50 years.

 

The biggest question remains: When will this country start to cut the
overall number within its borders and substantially reduce its dependency on
the most polluting form of power generation?

 

Mr Xi's address came after US President Joe Biden gave his maiden speech at
the United Nations during which he urged countries to work together as never
before to tackle global problems such as climate change and the pandemic.

 

Mr Biden also said that democracy would not be defeated by authoritarianism,
but refrained from mentioning China by name.

 

"The future will belong to those who give their people the ability to
breathe free, not those who seek to suffocate their people with an iron
hand," Mr Biden said.

 

"We all must call out and condemn the targeting and oppression of racial,
ethnic, and religious minorities, whether it occurs in Xinjiang or northern
Ethiopia, or anywhere in the world," he added, referring to the western
Chinese region where China is accused of using forced labour.

 

Relations between the US and China are at an all time low over issues
including trade, human rights and the origins of Covid-19.

 

In his address, Mr Xi said that China had peaceful intentions in
international relations.

 

But he also seemed to address the tensions and the formation of alliances in
the region like the "Quad" grouping, made up of Australia, the US, India and
Japan, saying there was a need to "reject the practice of forming small
circles or zero-sum games".-BBC

 

 

 

 

Major record labels could face competition inquiry

The UK's major record labels could face an inquiry into whether their
practices are distorting the music market.

 

The government has written to the Competition and Markets Authority (CMA)
asking it to consider an investigation into Sony, Warner and Universal
Music.

 

It has also asked the watchdog to consider YouTube's dominance over the
streaming market.

 

The move comes after MPs demanded a "complete reset" of the music industry,
amid "pitiful returns" for artists.

 

The Culture Select Committee issued the call in a damning report this
summer, after hearing evidence from musicians such as Nile Rodgers, Elbow
and Radiohead in a six-month inquiry into music streaming.

 

Julian Knight, who chairs the committee, said while streaming had "brought
significant profits to the recorded-music industry, the talent behind it -
performers, songwriters and composers - are losing out".

 

He called for the CMA to investigate the commercial power wielded by major
record labels, expressing concern they receive beneficial placement on
playlists and storefronts at the expense of independent labels and
self-releasing artists.

 

In an official response, the government said there "may be value" in such a
market study but it was up to the CMA to decide whether to pursue it.

 

"We have written to the CMA on this recommendation," it added.

 

The British Phonographic Industry (BPI), which represents the UK's
recorded-music industry, said it would comply with any resulting inquiry.

 

"Should the CMA conduct a study, we look forward to detailing labels' role
in supercharging the careers of British talent within a complex and dynamic
ecosystem," it said.

 

Streaming - where does the money go?

The culture committee's report, issued in July, was ultimately critical of
the UK music industry.

 

While streaming had helped save the music industry, after two decades of
illegal downloads, record labels and streaming companies had subsequently
"leveraged structural advantages to achieve seemingly unassailable
positions" in their markets, it said.

 

In its response, the government said the select committee's inquiry had
provided "invaluable insights" into music streaming but "there is still work
to be done to understand the problems musicians are facing".

 

It called for more research into the way musicians were paid and royalties
shared, saying it would "assess different models" to see how they would
affect the industry, including "equitable remuneration" - where labels and
artists receive an equal share of streaming royalties, in contrast to the
current arrangement, where artists receive about 16%.

 

The government also said it wanted to "explore ways in which new and
upcoming songwriters [and] composers" could be paid more fairly.

 

The MPs' report noted writers received particularly poor revenues from
streaming services, after pop composer Fiona Bevan revealed she had earned
just £100 for a track on Kylie Minogue's number-one album Disco.

 

"Right now, hit songwriters are driving Ubers," she told the inquiry. "It's
quite shameful"

 

In its response, the government said it would work with Credit's Due - an
initiative launched by Abba's Bjorn Ulvaeus - to ensure writers received
proper credit and remuneration for songs they worked on.

 

It also agreed with the select committee curators who made playlists on
services such as Spotify and Apple Music should adhere to a "code of
conduct" to avoid bribes and favouritism.

 

'Pitiful earning'

Mr Knight welcomed the government's response, saying: "Our inquiry into
music streaming exposed fundamental problems within the structure of the
music industry itself.

 

"It is testimony to all those who gave evidence to our inquiry that the
government has acknowledged our report as a 'key moment' for the music
industry.

 

"Within days we expect to see the government's own research published into
the pitiful earning of creators in this digital age and hope it will
corroborate what artists and musicians told us.

 

"We will be monitoring the outcome and what tangible steps the government
pledges to take to redress this unfairness and reward the talent behind the
music."

 

The BPI said: "We welcome government's recognition of the need for a better
understanding of the complexity of the music-streaming market".

 

Working together to address areas of concern was "preferable to legislative
intervention", it said, warning new regulations could jeopardise the
industry's "hard won return to growth after years of decline".-BBC

 

 

 

Gas price crisis: Government to pay millions to restart CO2 supplies

The government is set to pay out tens of millions of pounds to restart
production of carbon dioxide at a key plant in the UK amid fears over food
supplies and the nuclear industry.

 

The government will meet the full operating costs to run CF Industries'
Teesside plant for three weeks.

 

US-owned CF Industries recently shut two sites that produce 60% of the UK's
commercial carbon dioxide supplies.

 

The plant in Billingham will need up to three days to start producing new
CO2.

 

Environment Secretary George Eustice told the BBC that the deal with CF
Industries "will be not a loan, it will be a payment to underwrite some of
their fixed costs".

 

CF Industries had halted two of its fertiliser factories - which produce
carbon dioxide as a by-product - because of soaring gas prices.

 

 

Farms, food producers and supermarkets have warned that a shortage of carbon
dioxide will lead to significant disruption to the manufacturer and supply
of fresh produce.

 

The Times also reported that ministers were concerned that the UK may have
to close its six advanced gas-cooled nuclear reactors which also use CO2.

 

The government said it would provide support for CF Fertilisers' operating
costs for three weeks "whilst the CO2 market adapts to global prices". There
will be a cap to the overall cost.

 

Unusual move

Business Secretary Kwasi Kwarteng said the "exceptional short-term
arrangement" would ensure industries that rely on a stable supply of CO2
"have the resources they require to avoid disruption".

 

However, only one of CF Industries' plants will reopen - its Cheshire site
remains closed - and it will take about three days to restart CO2
production.

 

Tony Will, chief executive at CF Industries, who flew from the US to the UK
on Sunday to meet Mr Kwarteng, said: "We look forward to working with
Secretary Kwarteng and the UK government on developing a longer-term
solution, including the development of alternative suppliers of CO2 for the
UK market."

 

The business secretary previously ruled out nationalising the company,
although providing financial support is still seen as an unusual move.

 

Graphic showing where CO2 is produced in the UK and how it is used in the
food industry.

Andrew Opie, director of food and sustainability at the British Retail
Consortium, welcomed the decision, but said the timetable to restart CF
Industries' factory and start producing carbon dioxide "will still be
tight".

 

He told the BBC's Today programme: "Our understanding is that provided that
carbon dioxide starts to get through to food producers by the end of the
week, then we can avert major and significant disruption in our stores."

 

Mr Eustice warned that the food industry would face a sharp rise in carbon
dioxide prices.

 

He said the industry "is recognising...they will need to pay more for that
carbon dioxide, but unless we were to take this action this week, we could
have had supply chain issues, for poultry in particular, by the beginning of
next week and no government could allow that to happen".

 

Ian Wright, the chief executive of the Food and Drink Federation, said on
Tuesday that consumers could start noticing shortages in poultry, pork and
bakery products within days.

 

"We probably have about 10 days before this gets to the point where
consumers, shoppers and diners notice that those products are not
available," he said.

 

"It is a real crisis," he added, saying that poultry and pork production
would be seriously affected by the end of this week without intervention.

 

He also called on the government to support other fertiliser producers and
help food producers to look for alternatives to CO2.

 

The BBC understands that the deal with CF Industries has been drafted so
that other companies who stop production due to high commodity prices will
not be able to ask the government for similar help.

 

Norwegian firm Yara has also cut production at a number of European
factories, including one in Hull.

 

Mr Kwarteng had said previously that "time is of the essence" in organising
the deal with CF Industries, acknowledging that "it may come at some cost".

 

Knock-on effects

A spokesman for the British Meat Processors Association said a "key
question" for the industry was "when will the plants be back on stream, as
every day of disruption has knock-on effects for the meat processing
industry".

 

The president of the National Farmers' Union, Minette Batters, added: "It's
important this restart is meaningful and sustained.

 

"Users of carbon dioxide were given little to no warning that supplies were
going to be cut off - an indication of market failure in a sector supporting
our critical national infrastructure."

 

Prime Minister Boris Johnson urged people not to worry about putting food on
the table this winter, amid rising energy and food bills and a cut to
universal credit.

 

Wholesale prices for gas have surged 250% since January, with a 70% rise
since August alone, leading to calls for support from the industry, and the
collapse of some smaller energy firms.

 

The resulting shortage of carbon dioxide saw warnings about the potential
impact on food suppliers, as well as the NHS and the nuclear industry, where
it is used as a coolant.

 

Mr Opie added that the government should also take action on other issues
affecting food retailers in recent weeks, such as the shortage of HGV
drivers, which has been exacerbated by the pandemic and many drivers
returning to the European Union after Brexit.

 

The government has been keen to stress that this is very much an emergency
measure, time-limited, and with a cap on the amount it is prepared to pay.

 

It had to do something. Food producers were warning that shortages would
become apparent within days, at a time when supply chains have already been
disrupted by other issues, such as a lack of lorry drivers.

 

But the fact remains that it has agreed to give a large US-owned company
tens of millions of pounds of taxpayers' money, just to operate one of its
own plants. That isn't a particularly good look - and it has cast a glaring
spotlight on the vulnerability of a key part of the economy.

 

Now there is a three-week window for government, supermarkets and food
producers to come up with a "sustainable market-based solution". In
practice, that's likely to mean users paying more for their CO2, a cost
which will ultimately be borne by consumers.-BBC

 

 

 

Pret says midweek busiest for office worker trade

Pret A Manger says it is seeing a return of workers to the office in busy
city centres.

 

Tuesdays, Wednesdays and Thursdays were now the busiest for the sandwich
chain, Pret boss Pano Christou told BBC Radio 4's Today programme.

 

Pret has announced plans to hire 3,000 staff by the end of 2022 after
cutting the same number of jobs last year.

 

Mr Christou said the chain hoped to open 200 more shops in the UK over the
next two years.

 

He added that Pret hoped to expand into five markets overseas by the end of
2023, with many of the new outlets placed in train stations, bus stations
and motorway services.

 

The expansion proposals come as demand from commuters and office workers - a
key market for the chain - has started to pick up again after plunging
during the Covid lockdowns.

 

The business is now looking to turn that around, despite having to tackle
supply chain and heavy goods vehicle (HGV) lorry driver shortages, like many
other businesses across the country.

 

"A couple of weeks ago, we ran out of some prepared fruit for two or three
days [and] we were short of a couple of our bread lines for a couple of
days," he said.

 

"I think we will see [the driver shortages] until the end of this year and
into next year - there's a real challenge for the industry to navigate
through."

 

Pandemic impact

The impact of the first lockdown led to Pret cutting 3,000 jobs, which
represented a third of its workforce. Most of the jobs axed were from its
shops, but 90 roles were also lost at its support centre.

 

The chain posted a 58% fall in revenue to £299m in 2020, compared with £708m
the year before.

 

Mr Christou told the BBC the "most difficult period" over the last year was
having to make people redundant.

 

"You have so many people's lives in your hands and making those decisions
was the most difficult thing I had to do in my entire career," he said.

 

"When you have to make a call on thousands of people's jobs, that is
something you spend a lot of time thinking through. But it was about how we
could ensure that the business would survive and come through Covid."

 

As part of its recruitment drive, Pret said it had received a £100m
investment from JAB and Pret founder Sinclair Beecham to accelerate the
expansion.

 

Brighter future

"Last year we were in the eye of the storm during the height of the
pandemic. Now we have the chance to build a bright new future for Pret," Mr
Christou said.

 

"It's been an incredibly tough two years, but we have a big opportunity
ahead."

 

Mr Christou said he was "definitely seeing our Pret stores getting busier"
since coronavirus restrictions were lifted on 19 July.

 

The number of employees working across the Pret has grown 28% since the
start of the year, with more than 6,000 employees in the UK. About 30% of
those employed this year had worked for Pret previously.

 

"Clearly recruitment is a challenge at the moment, and we're putting
everything behind ensuring that we are an employer of choice; that we pay
well, that we've got the right benefits, and then we've got the right bonus
available to attract new staff," Mr Christou said.

 

Last week Pret announced that it was increasing pay by at least 5% for its
cafe workers, weeks after ditching paid breaks and attempting to slash
bonuses.

 

The move means that starting pay for store workers will now rise to a
minimum of £9.40 an hour, up from the legal minimum of £8.91, but all team
members, including managers will get a raise.-BBC

 

 

 

Record backlog of cargo ships at California ports

Some 65 cargo ships have been forced to queue outside two of America's
biggest ports, in the latest sign of supply chain disruption hitting the US.

 

The ships are stuck outside the ports of Los Angeles and Long Beach,
California, which handle 40% of all cargo containers entering the country.

 

Before Covid, it was unusual for more than one to wait for a berth.

 

The backlog is linked to surging demand for imports as the US economy has
reopened.

 

Retailers and manufacturers have rushed to place orders and restock their
inventories, but the global shipping system is struggling to keep up.

 

It's contributed to shortages of children's toys, timber, new clothes and
pet food, while also pushing up consumer prices.

 

Gene Seroka, head of the Port of LA, last week warned that a "significant
volume" of cargo was "headed our way throughout this year and into 2022".

 

"We continue to monitor a host of variables; disruptions continue at every
node in the supply chain," he said.

 

Disruption to shipping could last until Christmas

Together, LA and Long Beach are the main seaborne gateway to the US,
particularly for imports from China.

 

And on Saturday a record 73 ships were stuck outside - almost twice as many
as at the same time in August.

 

Some cargo ships have been diverted because of the backlog, which is
preventing thousands of containers from being unloaded.

 

But nearby ports like Oakland do not have the capacity to deal with the
volume of trade.

 

At the Port of LA alone, the amount of cargo handled is up 30% this year so
far, compared with the whole of 2020.

 

'Weather the storm'

The US Toy Association, which represents 950 toy firms with a US presence,
has warned the crisis in California could affect many of its members going
into the all-important holiday season.

 

Its members sell three billion toys a year, 85% of which come from China.

 

"The larger retailers we work with have relationships with the shippers, and
they can weather this storm fairly well relatively speaking," boss Ed
Desmond said.

 

"It's really the small companies that are facing the brunt of this impact.
They really don't have the leverage or the size to have those annual
contracts."

 

The Californian ports have now agreed to expand the hours during which
trucks can pick up and return containers to try to ease the backlog.

 

They are also working with the White House Supply Chain Disruptions Task
Force, which was set up in June to try to alleviate bottlenecks.

 

Other ports such as Savannah in Georgia have also seen record shipping
congestion, while the nation's second busiest entry point - New York - said
it faced transit issues outside the port.

 

"Currently congestion is related to cargo moving from the port, such as
trucks and freight rail, due to record-high cargo volume," spokeswoman
Amanda Kwan told the BBC.

 

Last month port bosses across the US told the Wall Street Journal they saw
the bottlenecks lasting as long as summer 2022.

 

By tonnage, about 70% of all US-international trade moves by water through
America's ports.-BBC

 

 

 

Catalogue of errors led to £1bn of state pension underpayments

Repeated human errors made for years were to blame for a scandal which led
to more than £1bn of state pensions not being paid, a report has concluded.

 

The National Audit Office (NAO) said 134,000 pensioners, mostly women, were
underpaid pensions because outdated computer systems led to mistakes.

 

Among them was 74-year-old Irene Wise, who said women like her were
"short-changed" for years.

 

The government said everyone would receive what they were owed.

 

However, the report raises huge questions for the Department for Work and
Pensions (DWP) over the way the state pension system functions and the
mistakes that led to such a massive shortfall in payments.

 

Reacting to the report, Meg Hillier, who chairs the Public Accounts
Committee, said: "This is not the first widespread error we have seen in the
DWP in recent years. Correcting these errors comes at great cost to the
taxpayer.

 

 

"The DWP must provide urgent redress to those affected and take real action
to prevent similar errors in future."

 

Cost to the taxpayer

The problem relates to the "old" state pension system where married women
who had a poor pension in their own right could claim a 60% basic state
pension based on their husband's record of contributions.

 

A review is taking place to trace those affected by systemic failures to
award these pension rises, stretching back to 1985. But only some women are
being fully paid. Others will only be able to claim for 12 months of missed
payments.

 

The DWP is expecting to pay the affected pensioners it can trace a total of
£1.05bn, at an average of £8,900 per pensioner affected. That exercise will
cost the taxpayer £25m in staff costs and will not be completed until the
end of 2023. An estimated 40,000 affected women have already died.

 

'You get fed up with it'

Grandmother-of-four Mrs Wise, from Worcestershire, spent two years battling
for her money. The NAO report said that some pensioners who contacted the
DWP may have been falsely reassured that their payments were correct.

 

The 74-year-old eventually received £7,334 in back payments for eight years
of missed pensions.

 

"When you think you have been short-changed for that many years, what a
difference [the money] could have made in certain circumstances," she said.

 

Jan Tiernan

image captionJan Tiernan was originally told her payments were correct

Jan Tiernan, from Fife, is one of those affected by the wider problems
caused by the errors. She too was initially told she was not owed any money.

 

"I told the DWP I should be getting another £30 a week based on my husband's
contributions. But they fobbed me off and said no. I didn't believe them due
to the media coverage, so I started writing to them," she said.

 

After nearly 100 pages of correspondence with the department, she received
£1,280. However, she believes she is still owed more than £17,000 in missed
payments.

 

"It makes me sad and angry. I've been on this campaign for two years now. It
is not just for me but for all of these people who have been done out of
this money. They should have got it," she said.

 

"At 81 years old, you get fed up with it. It is very wearing and it takes up
all your energy."

 

Complex system

The NAO report found that errors occurred because state pension rules were
complex, computer systems outdated and many tasks still needed to be done
manually.

 

"This makes some level of error in the processing of state pension claims
almost inevitable," it said.

 

It also found the DWP did not have a means of reviewing individual
complaints or errors, such as how many people were complaining about the
same issues, to assess whether the errors had a systemic cause.

 

As a result, it concluded that it missed opportunities to detect, prevent or
correct the errors.

 

Sir Steve Webb, partner at consultancy LCP and a former pensions minister,
unearthed the problems.

 

He said the department had "let down a generation of women". He said
officials should have been more curious about issues over many years.

 

A DWP spokesperson said: "We are fully committed to ensuring the historical
errors that have been made by successive governments are corrected, and as
this report acknowledges, we are dedicating significant resource to doing
so. Anyone impacted will be contacted by us to ensure they receive all that
they are owed.

 

"Since we became aware of this issue, we have introduced new quality control
processes and improved training to help ensure this does not happen again."

 

The department is facing a heavy workload, with increased benefits claims
during the pandemic, as well as a backlog in state pension applications
which has meant thousands of newly-retired people have yet to receive their
first state pension payments.-BBC

 

 

 

Failing energy firms may mean higher bills, warns regulator

The cost of protecting customers from failing energy providers could lead to
higher bills, the boss of the energy regulator Ofgem has told the BBC.

 

It comes as energy firm Green said it was on the brink of collapse due to
soaring wholesale gas prices.

 

"As underlying costs rise, pressure on bills does go up", Jonathan Brearley,
Ofgem chief executive said.

 

The government has said it is looking at lending money to bigger firms to
help them take on stranded customers.

 

If an energy firm collapses, customers are automatically switched to a
tariff provided by the new supplier. This is a tariff agreed with the
regulator Ofgem, but it may well be more expensive than the deal they had
with the former company which went bust.

 

Mr Brearley said protecting customers of failed energy firms was the
regulator's "number one priority".

 

However, he said it was too early to predict how expensive it would be to
ensure that they were transferred to other suppliers in an orderly way.

 

Peter McGirr, founder and chief executive of Green, told the BBC it had
appointed a restructuring firm in an attempt to survive the current crisis.

 

Mr McGirr said the firm was in "deep, deep trouble and our heads are
unlikely to bob back to the surface".

 

Green has 180 staff based in Newcastle upon Tyne and has 250,000 UK
customers.

 

Mr McGirr said the appointment of Alvarez and Marsal was currently on an
"advisory and restructuring" basis, but admitted Green could fall into
administration within weeks.

 

"We need to try to hold on long enough to get some support", he added.

 

The company has been in discussions with the government and energy regulator
Ofgem, but has not been offered any support.

 

Mr McGirr said he believed the larger energy suppliers had too much
influence in the crisis talks being held with government and said the big
companies had an interest in more of the smaller suppliers going to the
wall.

 

Cost implications

Asked whether these costs would be met by the taxpayer, or spread across all
energy customers' bills, he said: "We have to first of all make sure that
customers are transferred and looked after and then as we see the market
evolve we will understand better the cost implications."

 

Customers on some tariffs are protected from sudden hikes in wholesale gas
prices through the energy price cap, which limits how much firms can charge
per unit of gas.

 

The price cap covers 15 million households across England, Wales and
Scotland.

 

Mr Brearley said it was too early to predict how much the energy price cap
would rise next year.

 

Wholesale gas price

So far, four energy firms have gone to the wall, including People's Energy
and Utility Point, and four more are expected to follow in the coming days.

 

Industry sources fear there may be as few as 10 energy suppliers left by the
end of the year, down from 70 in January.

 

But Mr Brearley predicted that a number of small suppliers would survive the
current crisis, as well as larger ones, maintaining a diverse market with
plenty of choice for consumers.

 

When asked if Ofgem was "asleep at the wheel" and should have prevented
suppliers from making promises to customers which they wouldn't be able to
keep if prices rose, Mr Brearley replied: "No - we have always protected
customers interests and we work very closely with the companies.

 

"We work closely with all companies to assess their financial position. And
if they need to exit the market we have well-rehearsed systems and processes
to manage that."

 

Loans 'must be paid back'

Business Secretary Kwasi Kwarteng earlier denied that failed energy
companies would get government bailouts, saying: "I do not think it's the
right thing for taxpayers' money to be injected into companies that have
been badly run."

 

However, he said the government was exploring the possibility of lending
money to bigger energy firms to help them absorb the cost of taking on new
customers from companies that had gone bust.

 

"If we do have this policy, they will be expected to pay back the loans," he
added.

 

Mr Kwarteng also warned many UK households could face a "very difficult
winter", with fuel prices surging and the £20-a-week temporary uplift in
universal credit due to end in October.

 

The government and Ofgem have both dismissed suggestions that the cap on
energy prices would be lifted ahead of an agreed 12% rise in October, saying
that keeping it was the "clear and agreed position".

 

The price cap is reviewed twice a year. It applies only to standard variable
or default tariffs. These types of tariff are typically the most expensive
plan that a supplier offers.

 

When fixed energy deals expire, as they generally do after one or two years,
customers are likely to be put on these tariffs.

 

Mr Brearley said the industry had seen "an unprecedented rise in gas
prices".

 

"They are almost four times what they normally are and that would put any
industry under strain," he added.

 

The government and Ofgem say the UK does not have gas supply problems
because of a diverse range of sources "that can more than meet demand".

 

However, energy bills are facing particular pressures in Great Britain
because of a dip in renewable energy supplies due to low wind, as well as
the outage of a power cable supplying electricity from France.

 

The International Energy Agency has called on Russia to supply more gas to
Europe, saying "it could do more to increase gas availability to Europe and
ensure storage is filled to adequate levels", in preparation for the winter.

 

It added: "Based on the available information, Russia is fulfilling its
long-term contracts with European counterparts - but its exports to Europe
are down from their 2019 level.

 

"This is also an opportunity for Russia to underscore its credentials as a
reliable supplier to the European market."

 

Stacey Stothard followed all the advice. Aware that energy prices were
rising, she shopped around to find a decent fixed deal for her gas and
electricity.

 

She saved £300 - or so she thought.

 

Her new energy supplier went bust and now she will be switched automatically
to another one, and she is facing much higher bills, potentially amounting
to hundreds of pounds more a year.

 

"It is just like watching the meter go up and up," she says. "I did the
right thing - not going for the cheapest deal, but choosing a company with a
decent customer service record."-BBC

 

 

 

'No clear end to HS2 cost and delays' say MPs

There is "no clear end in sight" to HS2 costs and delays, MPs on the Public
Accounts Committee have said.

 

The committee is "increasingly alarmed" about key parts of the project,
including a lack of progress at Euston Station.

 

Without a government decision on the station, the project "will literally
run out of time", the committee fears.

 

The Department for Transport (DfT) said it was making significant progress
delivering HS2.

 

Euston Station is an important part of the first phase of the rail project,
both as a London terminus and as a link to other infrastructure such as the
London Underground.

 

But the DfT "is yet to make key decisions on the design and approach to
construction there" despite having the necessary planning consents.

 

 

This could "lead to yet more costs, delays and uncertainty over the promised
benefits of the programme", the committee said.

 

Dame Meg Hillier, chair of the Public Accounts Committee, said: "HS2 is
already one of the single most expensive taxpayer-funded programmes in the
UK but there's actually no clear end in sight in terms of the final cost, or
even the final route.

 

"The project was plagued by a lack of planning and transparency from the
start and there are many difficulties ahead.

 

"This project cannot simply keep sinking more taxpayer funds without greater
clarity on the later phases. The development of Euston is a real challenge
that must be resolved swiftly now."

 

The current estimated cost of completing HS2 is between £72bn and £98bn at
2019 prices, compared with an original budget of £55.7bn in 2015 at 2015
prices.

 

The DfT said: "We are making significant progress delivering HS2, a key part
of our promise to build back better from Covid-19.

 

"We will continue to rigorously control pressures, and as our latest update
to Parliament confirmed, Phase One remains within budget and schedule."

 

The Integrated Rail Plan would soon outline how major rail projects,
including HS2 Phase 2b, would work together to "deliver the reliable train
services that passengers across the North and Midlands need and deserve", it
added.

 

Bounce back

HS2 Ltd, the firm behind the project, said: "HS2 Phases One and 2a have
received parliamentary approval and have very clear cost ranges.

 

"Although there have been challenges - particularly relating to the pandemic
- the project remains on budget."

 

The company said the HS2 was supporting more than 20,000 jobs.

 

The Public Accounts Committee has been critical of the rail project in the
past, and in May 2020 said HS2 was "badly off course" and that bosses had
been "blindsided by contact with reality".

 

The committee accused HS2 Ltd and the DfT of lacking transparency and
undermining public confidence.

 

Following this criticism, the government was now providing "a clearer
explanation of costs than we have previously seen in its reporting to
Parliament", the MPs said on Wednesday.

 

As tunnelling machines bore into the earth below the Chilterns, intense
scrutiny of HS2 continues above ground.

 

HS2's huge budget, environmental impact and community disruption are making
lots of MPs and their constituents angry. But last week the government's
high speed minister recommitted to the project "going full steam ahead".

 

But there is still a major political issue for the government on HS2 - will
it all get built?

 

The prime minister still hasn't confirmed if the Eastern leg from the West
Midlands to Leeds will happen, and Northern politicians are starting to
express their frustration.

 

Conservative and Labour MPs in Yorkshire see it as crucial for
"levelling-up" the region, alongside other major rail investment they want
too.

 

But the government's cheque book is under pressure after a huge year of
Covid spending. And with inflation rising and costs growing, we wait to see
if the chancellor and prime minister push the button for it in full - or if
HS2 will be slimmed down.-BBC

 

 

 

German elections: Businesses face future without Merkel

Europe's powerhouse stands on the brink of significant political upheaval.

 

After more than 15 years at the helm of Europe's largest economy, Chancellor
Angela Merkel is stepping down.

 

Following elections this weekend, Germany will be looking at a new
government, and a new leader as well - businesses large and small are
wondering what that will mean for them after a very tough 18-months.

 

On an otherwise quiet side street in Munich, a line of cars is queuing up.
As they wait, in front of a garage concealed by a heavy velvet curtain, the
people inside are treated to a juggling display by a couple of exuberant
clowns.

 

Every few minutes, the curtain lifts, and a car is ushered through. Inside,
it's a maelstrom. A large group of clowns are busy throwing huge quantities
of soap and water over each car as it comes in - and even more over each
other.

 

There's a sound system belting out disco hits, it's noisy, hot and very,
very wet.

 

Further on, the cars pass through a rather more sophisticated automatic
washing and drying machine, before the occupants are entertained with
another display - this time featuring strongmen, acrobats and even a
fire-breather, as well as the inevitable clowns.

 

This extraordinary carwash is run by the Circus Krone, a business which has
been a fixture in central Munich for more than a century.

 

The circus itself normally operates out of a permanent 3000 seat arena - but
it has been unable to host any shows since March last year, due to the
pandemic.

 

According to the Circus' director and lion tamer, Martin Lacey, the car wash
has served a vital purpose during Covid, keeping his performers busy while
bringing in a small amount of much-needed income.

 

Together with funding from the government's Kurzarbeit scheme, which
subsidises wages when employees' hours are cut, it has helped the company
avoid firing any of its 240-strong workforce.

 

But Mr Lacey is frustrated. He is unhappy that despite the company's best
efforts to make the circus arena Covid-safe, it has been unable to open,
while other parts of the economy are well on their way back to normal life.
The new government, he says, will have to offer more consistent policies in
the future.

 

"It costs a lot of money to run this business, and therefore we do need help
in these situations", he points out.

 

"When they make a law they have to really think about the laws they're
making. There's been a lot of backwards and forwards. So that's been very,
very difficult".

 

A short distance across town, in the cellars beneath the ornate neo-Gothic
New Town Hall, the Ratskeller restaurant is preparing a range of Bavarian
delicacies for its evening customers.

 

"Schnitzel, schweinshaxe, sauerbraten
Many tourists come in here, and of
course they eat Bavarian food", explains restaurant manager Peter Wieser.

 

Life has been difficult during the pandemic, but customer numbers are
picking up, Mr Wieser says.

 

He wants the new government to ensure that consumer taxes, cut during the
outbreak, stay low. He is also hoping it will become easier to recruit
immigrant labour, to help solve a shortage of workers.

 

"We need employees", he says.

 

"In the past, we had immigrants here. We trained them, they paid taxes, they
worked here. Then they had to go back to their country. This is not the
right way - we need these people right now."

 

But on the prospect of life under a new Chancellor, he insists he's very
relaxed.

 

"We had 15 years of Angela Merkel. I'm a fan of Angela Merkel, but now it's
time to change, and we'll handle it somehow", he says with a grin.

 

Many small and medium sized businesses in Germany, as in other countries,
are currently focused on short-term survival in the hope of medium-term
revival. But larger companies are able to focus on the longer term.

 

Race for technology

At the IAA International mobility show in Munich, I meet with Wolf-Henning
Scheider, the chief executive of ZF Group, a major supplier of high-tech
systems for the world's carmakers.

 

As he prepares to welcome Mrs Merkel herself to his stand at the show, he
tells me the new Chancellor will have to take her place as a leader on the
European stage.

 

"We need a strong Europe, focusing on technology", he says.

 

"We see a North America, we see a China, focusing heavily on most advanced
technology and education, and trying to take a lead. That is a competition
where Europe has to play the game."

 

It's a theme which is echoed by plenty of other senior executives at the
show - and indeed, across the business community.

 

With the fortunes of the main parties fluctuating throughout the election
campaign, it is still by no means clear who will lead the next government,
even if the Social Democrats of Vice Chancellor Olaf Scholz now seem to be
in pole position.

 

But whoever inherits the keys to the Chancellery, it is clear Germany is
facing a new era - and for the new leader there will be no shortage of tough
economic challenges.-BBC

 

 

 

Salesforce rival Freshworks raises $1.03 bln in U.S. IPO, valued at $10.13
bln

(Reuters) - Business software firm Freshworks said it had priced its U.S.
initial public offering well above the target range to raise $1.03 billion,
valuing the Salesforce.com (CRM.N) rival at $10.13 billion as hybrid work
fuels demand for its products.

 

Freshworks priced 28.5 million shares at $36 per share, the company backed
by Accel and Sequoia Capital said on Tuesday. It had earlier expected to
raise $969 million at the top end of its increased price range of $32 to $34
per share. read more

 

San Mateo, California-based Freshworks joins a number of big names from the
enterprise software business that have taken advantage of red-hot U.S.
capital markets over the past 18 months.

 

Most software IPOs during that period have been well-received by investors
who see room for growth in the sector even after the pandemic, as the
adoption of hybrid work models by companies across the world drive up demand
for enterprise software products.

 

Founded in Chennai, India, in 2010, Freshworks helps businesses with
customer management, offering products including a messaging platform, an
artificial intelligence-powered chatbot for customer support and call-center
solutions that promise shorter wait times.

 

Freshworks shares are scheduled to start trading on the Nasdaq on Wednesday
under the symbol "FRSH".

 

Morgan Stanley, J.P. Morgan, BofA Securities are the lead underwriters for
the offering.

 

The Thomson Reuters Trust Principles.

 

 

 

Facebook wraps up deals with Australian media firms, TV broadcaster SBS
excluded

(Reuters) - Facebook Inc (FB.O) has told Australian publishers it has
stopped negotiating licensing deals, an email to the industry seen by
Reuters showed, a move which came just six months after the passing of a law
designed to make tech giants pay for news content.

 

While Facebook has announced deals with most of the country's largest news
outlets, some companies including TV broadcaster SBS and smaller publishers
have been left out in the cold, raising questions about the scope and
effectiveness of the ground-breaking law.

 

Australia is the only country with a law where the government may set the
fees if negotiations between tech giants and news providers fail, but the
rejected companies are left with little recourse for the time being and are
waiting for the government to review the law in 2022 as planned.

 

Facebook's regional head of news partnerships, Andrew Hunter, said in an
August email to publishers it had "now concluded" deals where it would pay
Australian companies for content on its just-launched "Facebook News"
channel.

 

Nick Shelton, founder of Broadsheet Media, a website which publishes
entertainment news, reviews and listings and was rebuffed by Facebook, said
the decision to close off on new deals was "clearly an attempt from Facebook
to cap their exposure to independent publishers."

 

The Special Broadcasting Service, or SBS, one of Australia's five national
free-to-air broadcasters and the country's main source of foreign language
news, said Facebook declined to enter negotiations despite months of
attempts and that it was surprised and disappointed. It noted it had
successfully concluded a deal with Google (GOOGL.O).

 

"This outcome is at odds with the Government's intention of supporting
public interest journalism, and in particular including the public service
broadcasters in the Code framework with respect to remuneration," an SBS
spokesperson said in a statement on Wednesday.

 

Hunter said in the email to publishers, which has not been made public, that
rejected publishers would continue to benefit from clicks directed from
Facebook and recommended they tap a new series of industry grants.

 

In a separate statement to Reuters, Hunter said content deals were "just one
of the ways that Facebook provides support to publishers, and we've been
having ongoing discussions with publishers about the types of news content
that can best deliver value for publishers and for Facebook".

 

Facebook did not respond directly to questions about the statements from
Broadsheet Media and SBS.

 

The U.S. social media giant has inked deals with a range of large Australian
big media companies including News Corp (NWSA.O) and the Australian
Broadcasting Corp and has a collective bargaining arrangement with rural
publishers. But only a handful of independent and smaller publishers have
reached deals.

 

Other rejected publishers include the Conversation, which publishes public
affairs commentary by academics, Reuters has previously reported. That
prompted a rebuke from the regulator which drafted the law. The Australian
Competition and Consumer Commission declined to comment on Wednesday.

 

Under the law, which drove Facebook to block third-party content on
newsfeeds briefly in the country in February, Facebook and Google must
negotiate with news outlets for content that drives traffic to their
websites or face possible government intervention.

 

But before there can be any government intervention, the federal treasurer
must determine that either Facebook or Google failed to negotiate in good
faith, a step known as "designation". A representative for Treasurer Josh
Frydenberg was not immediately available for comment.

 

Facebook's rejection of SBS and the Conversation flies in the face of law's
core proposition that it "should be required to compensate public interest
journalism", said Peter Lewis, director of the Centre for Responsible
Technology, a think tank.

 

"The treasurer has no alternative but to revisit designating Facebook to
ensure that it meets its commitments to public interest journalism in
Australia."

 

The Thomson Reuters Trust Principles.

 

 

 

German auto giants place their bets on hydrogen cars

(Reuters) - Battery power may be the frontrunner to become the car
technology of the future, but don't rule out the underdog hydrogen.

 

That's the view of some major automakers, including BMW (BMWG.DE) and Audi
(VOWG_p.DE), which are developing hydrogen fuel-cell passenger vehicle
prototypes alongside their fleets of battery cars as part of preparations to
abandon fossil fuels.

 

They are hedging their bets, calculating that a change in political winds
could shift the balance towards hydrogen in an industry shaped by
early-mover Tesla's (TSLA.O) decision to take the battery-powered road to
clean cars.

 

Global auto hub Germany is in sharp focus. It is already betting billions on
hydrogen fuel in sectors like steel and chemicals to meet climate targets,
and closely-fought elections this month could see the Greens enter the
coalition government and further push the technology.

 

BMW is hydrogen's biggest proponent among Germany's carmakers, charting a
path to a mass-market model around 2030. The company also has one eye on
shifting hydrogen policies in Europe and in China, the world's largest car
market.

 

The Munich-based premium player has developed a hydrogen prototype car based
on its X5 SUV, in a project already partly funded by the German government.

 

Jürgen Guldner, the BMW vice president who heads up the hydrogen fuel-cell
car programme, told Reuters the carmaker would build a test fleet of close
to 100 cars in 2022.

 

"Whether this (technology) is driven by politics or demand, we will be ready
with a product," he said, adding that his team is already working to develop
the next generation vehicles.

 

 

"We're on the verge of getting there and we're really convinced we'll see a
breakthrough in this decade," he said.

 

VW's premium Audi brand told Reuters it had assembled a team of more than
100 mechanics and engineers who were researching hydrogen fuel cells on
behalf of the whole Volkswagen group, and had built a few prototype cars.

 

Hydrogen is viewed as a sure bet by the world's biggest truckmakers, such as
Daimler AG (DAIGn.DE) unit Daimler Truck, Volvo Trucks (VOLVb.ST) and
Hyundai (005380.KS), because batteries are too heavy for long-distance
commercial vehicles.

 

Yet fuel cell technology - where hydrogen passes through a catalyst,
producing electricity - is for now too costly for mass-market consumer cars.
Cells are complex and contain expensive materials, and although refuelling
is quicker than battery recharging, infrastructure is more scarce.

 

The fact that hydrogen is so far behind in the race to the affordable market
also means even some champions of the technology, like Germany's Greens,
favour prioritising battery-powered passenger cars because they see them as
the fastest way to reach their main goal of decarbonising transport.

 

The Greens do, however, back the use of hydrogen fuel for ships and planes
and want to invest heavily in "green" hydrogen produced solely from
renewable sources.

 

"Hydrogen will play a highly important role in the transport industry," said
Stefan Gelbhaar, the party's transport policy spokesperson in the Bundestag.

 

Politics can be unpredictable though - diesel went from saint to sinner
following Volkswagen's Dieselgate emissions-cheating scandal, which came to
light in 2015. Some carmakers view hydrogen technology as an insurance
policy as the EU targets an effective ban on fossil-fuel cars from 2035.

 

Last year Daimler said it would wind down production of the Mercedes-Benz
GLC F-CELL, a hydrogen fuel-cell SUV, but a source familiar with company
plans said the project could easily be revived if the European Commission or
a German government with Green participation decide to promote hydrogen
cars.

 

"We're focusing on (battery) electric first, but we're in close cooperation
with our truck guys," said Jörg Burzer, Daimler's head of production, when
asked about that approach.

 

"The technology is always available."

 

180 KPH IN HYDROGEN X5

 

For years Japanese carmakers Toyota (7203.T), Nissan (7201.T) and Honda
(7267.T), and South Korea's Hyundai, were alone in developing and pushing
hydrogen fuel-cell cars, but now they have company.

 

China is expanding its hydrogen fuelling infrastructure, with several
carmakers now working on fuel-cell cars, including Great Wall Motor
(601633.SS), , which plans to develop hydrogen-powered SUVs.

 

The EU wants to build more hydrogen fuelling stations for commercial
vehicles. Fitch Solutions auto analyst Joshua Cobb said the bloc was only
likely to start pushing hydrogen passengers cars in two to three years'
time, given it was still figuring out how to pay for its battery-electric
car push and how to obtain enough "green" hydrogen from renewable sources.

 

But he added: "It's not out of bounds to think if the (German) Greens come
into power they could accelerate the push to adopt regulations favouring
hydrogen fuel-cell cars."

 

BMW's Guldner acknowledged hydrogen technology was too expensive to be
viable for the consumer market today, but said costs would come down as
trucking companies invested in the technology to bring fuel-cell vehicles to
market at scale.

 

To demonstrate BMW's hydrogen X5 prototype, Guldner took Reuters for a spin
at 180 km (112 miles) per hour on the autobahn near the carmaker's Munich
headquarters and in a few minutes gave it enough fuel to run 500 km using a
hydrogen gas pump at a Total petrol station.

 

Guldner said BMW saw hydrogen fuel-cell cars as "complementary" to its
future battery electric model range, providing an alternative for customers
who cannot charge at home, want to travel far and refuel swiftly. The motor
in the hydrogen X5 is the same as BMW's all-electric iX.

 

"When the future is zero emissions, we believe having two answers is better
than one," he added.

 

A LONG AND WINDING ROAD

 

Yet Fitch Solutions' Cobb said that it would still take years before any
European policy support for hydrogen-powered cars translated into
significant sales.

 

Indeed, auto consultancy LMC forecasts that various uses of hydrogen - in
commercial vehicles, aviation and energy storage - would spur its adoption
in passenger cars, but over the longer term.

 

"We're just not going to get there any time soon," said LMC senior
powertrain analyst Sam Adham. LMC estimates in 2030 hydrogen fuel-cell
models will make up just 0.1% of sales in Europe, and sales will only take
off after 2035.

 

There remain divisions about the technology's prospects in the global car
industry, and even within auto groups.

 

VW's Audi unit might be researching fuel cells, for example, but Volkswagen
group CEO Herbert Diess has been scathing about hydrogen-powered cars.

 

"The hydrogen car has proven NOT to be the solution to climate change," he
said in a tweet this year. "Sham debates are a waste of time."

 

Stephan Herbst, general manager of Toyota in Europe, has a different view.

 

Speaking in his role as a member of the Hydrogen Council business group,
which forecasts that hydrogen will power more than 400 million cars by 2050,
Herbst said he was confident that now governments had set ambitious
carbon-reduction targets, they would push hydrogen alongside battery
electric cars.

 

"We strongly believe this is not a question of either or," he added. "We
need both technologies."

 

The Thomson Reuters Trust Principles.

 

 

 

 

 

 

 


 


 


Invest Wisely!

Bulls n Bears 

 

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INVESTORS DIARY 2021

 


Company

Event

Venue

Date & Time

 


 

 

 

 

 


 

 

 

 

 


 

 

 

 

 


Star Africa

AGM

virtual

September 23 -11am

 


 

National Unity Day

 

December 22

 


 

Christmas Day

 

December 25

 


 

Boxing Day

 

December 26

 


 

Public Holiday in lieu of Boxing Day falling on a Sunday

 

December 27

 


Companies under Cautionary

 

 

 


 

 

 

 


ART

PPC

 

 


Starafrica

Fidelity

Turnall

 


Medtech

Zimre

Nampak Zimbabwe

 


 

 

 

 


 <mailto:info at bulls.co.zw> 

 


 

 


DISCLAIMER: This report has been prepared by Bulls ‘n Bears, a division of
Faith Capital (Pvt) Ltd for general information purposes only and does not
constitute an offer to sell or the solicitation of an offer to buy or
subscribe for any securities. The information contained in this report has
been compiled from sources believed to be reliable, but no representation or
warranty is made or guarantee given as to its accuracy or completeness. All
opinions expressed and recommendations made are subject to change without
notice. Securities or financial instruments mentioned herein may not be
suitable for all investors. Securities of emerging and mid-size growth
companies typically involve a higher degree of risk and more volatility than
the securities of more established companies. Neither Faith Capital nor any
other member of Bulls ‘n Bears nor any other person, accepts any liability
whatsoever for any loss howsoever arising from any use of this report or its
contents or otherwise arising in connection therewith. Recipients of this
report shall be solely responsible for making their own independent
investigation into the business, financial condition and future prospects of
any companies referred to in this report. Other  Indices quoted herein are
for guideline purposes only and sourced from third parties.

 


 

 


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<mailto:info at bulls.co.zw> info at bulls.co.zw Tel: +263 4 2927658 Cell: +263 77
344 1674

 


 

 

 

 

 

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