On the Move, June 10-16, 2024

Umicore warns of electric vehicle market downturn

Umicore a leading battery materials manufacturer, has reported a sharp decline in demand for electric vehicles, causing a reduction in its profit forecast. The company has observed weakening orders from major customers like Volkswagen and 宝马 , with expected volumes for 2024 now projected to be flat or lower compared to last year. Umicore's shares dropped to a 10-year low following the announcement. The firm is also grappling with competition from cheaper Chinese batteries. In response, Umicore is cutting its capital expenditure and adjusting its strategies to navigate the challenging market conditions.

Hyundai to list Indian unit in massive IPO

Hyundai Motor Company (?????) plans to list its Indian subsidiary in one of the largest-ever public offerings in India, aiming to capitalise on the booming car market. The South Korean automaker will sell up to 17.5% of its shares in Hyundai Motor India, potentially raising about $2.5bn and valuing the company at around $25bn. This IPO could surpass India's largest to date, the $2.45bn Life Insurance Corp IPO in 2022. Hyundai's listing follows record auto sales and is slated for around the Diwali festival, depending on regulatory approval. The move is part of Hyundai's strategy to boost corporate value and increase production capacity in India.

BYD shares soar as EU imposes lower-than-expected tariffs

Shares of 比亚迪 , backed by Warren Buffett, surged by 9% after the EU announced lower-than-anticipated tariffs on Chinese electric vehicles. The European Commission imposed a 17.4% additional tariff on BYD, lower than the market's forecast. BYD's strategic investment in a Hungarian EV factory and high profit margins position it well to navigate the new tariffs. Beijing criticised the tariffs as protectionist, while Shanghai-based SAIC rebuked the EU's decision, stating it contradicts market economy principles. The tariffs are expected to drive consolidation in China's car industry, benefiting larger firms like 比亚迪 and 吉利控股集团 .

Tesla shareholders approve Musk's record pay deal and Texas move

Tesla shareholders have reapproved Elon Musk's $56bn pay package and voted to reincorporate the company in Texas. This decision follows a Delaware court's voiding of the 2018 compensation package. The pay deal, backed by 77% of votes, will increase Musk's stake to over 20%. Despite Tesla's stock falling 29% in the past year, the vote is seen as a major win for Musk, who addressed cheering investors in Austin. Tesla's future now hinges on the outcome of a Delaware hearing next month regarding the compensation package.

Lloyd's CEO says insurers can't deny climate change

Lloyd's of London CEO, John Neal , stresses the undeniable impact of climate change on insurance. Meeting in New York, Neal discusses the rising frequency and severity of weather-related losses, noting that insurers acknowledge the reality of climate change. He highlights the complex risk landscape, from geopolitical to technological challenges, and the necessity for new public-private partnerships to manage these risks. Neal points out the skyrocketing premiums in vulnerable areas and the growing trend of self-insurance. He emphasises the evolving nature of insurance, requiring more scientists and data analysts to navigate today's multifaceted risks.

Hydrogen's future shifts from hype to practical applications

Once hailed as the ultimate green fuel, the energy sector is now more discerning about hydrogen's practical applications. UK energy minister Claire Coutinho MP 's recent endorsement of JCB 's hydrogen-powered digger highlights Britain's commitment to hydrogen. However, experts question its viability for heavy machinery due to logistical and safety concerns. High costs and limited production remain obstacles, with promising sectors being fertiliser, steelmaking, shipping, and aviation. Despite projections of rising demand, the market's future hinges on infrastructure, incentives, and global adoption, especially by major players like China.