German government says airlines could face more bankruptcies

BERLIN, Oct 18 — Increasing competitive pressures inside and outside Europe could lead to additional airline restructurings and bankruptcies, the German government said in a response to a parliamentary query that was published today by the…

Labour strife in India’s manufacturing hubs may undermine Modi’s jobs push

CHENNAI/NEW DELHI: Labour unrest is on the rise at two centres in India where motorcycles and components are manufactured, underlining the problems Prime Minister Narendra Modi’s government faces in creating new manufacturing jobs that are sustainable and pay attractive wages. Motorbike makers, such as Japan’s Yamaha, and India’s Eicher Motors – maker of the iconic Royal […]

Jeff Bezos to invest more than US$1b in Blue Origin in 2019

SAN FRANCISCO: The world's richest man, billionaire entrepreneur and Amazon boss Jeff Bezos, said Monday that he is planning to boost his annual investment in Blue Origin, the aerospace company he launched in 2000.

Bezos — whose real-time net worth was estimated at US$145 billion, (RM602 billion) by Forbes, in large part thanks to his shares in Amazon — said he had spent about a billion dollars a year on developing Blue Origin.

“Next year, it'll be a little more — I just got that news from the team, recently,” Bezos said at the Wired 25th anniversary summit in San Francisco. “I always say yes — I'm, like, the worst”.

Blue Origin is working on space tourism, and developing rockets for satellite launches and space exploration, much like its rival, Elon Musk's SpaceX.

SpaceX, however, is ahead, having been operational in the rocket race for six years already.

In addition to his position as Amazon CEO, Bezos also owns The Washington Post.

“We need the same dynamism in space that we've seen online over the last 25 years,” he explained, saying he wanted to help launch a new age in space exploration. “We can do that — we need reusable space vehicles”.

Blue Origin's stated goal, much like SpaceX, is to lower the cost of space launches, as the next logical innovation following the work of US space agency Nasa, the Soviet Union and others.

Those Golden Era space programs used rockets that were destroyed upon re-entry into the Earth's atmosphere. Blue Origin and SpaceX are developing recyclable rockets.

Blue Origin's New Glenn rocket — named for pioneering astronaut John Glenn — is not expected to be ready before 2021.

The smaller New Shepard — named for Alan Shepard, the first American to go to space — is designed to take six passengers past the so-called Karman line, the internationally recognized boundary of space, to experience weightlessness.

Several key tests carried out this year were a success, and it could be ready in 2019, Bezos says. In the space tourism game, Blue Origin is competing with Virgin Galactic.

“I keep telling the team — it's not a race,” Bezos said. “I want this to be the safest space vehicle in the history of space vehicles”. — AFP

Resilience expected for the rest of AirAsia’s year

KUCHING: Analysts expect AirAsia Group Bhd (AirAsia) to remain resilient for the first half of its financial year 2018 (1HFY18) in spite of its net profit coming in lower by 10.5 per cent year on year (y-o-y) due to impact of fuel price increase. DF Amanah Investment Bank Bhd (MIDF Research) saw that in addition, […]

Canada sees little chance of quick end to US metals tariffs, sources say

OTTAWA, Oct 12 — Canada does not hold out much hope that Washington will quickly lift tariffs that it imposed on steel and aluminium exports and is resisting a US push to agree to strict quotas, two sources familiar with the matter said. The…

BMW to buy control of China venture in ‘new era’ for foreign carmakers

SHENYANG, China: Germany's BMW will pay 3.6 billion euros (US$4.2 billion) to take control of its main joint venture in China, the first such move by a global carmaker as Beijing starts to relax ownership rules for the world's biggest auto market.

The luxury carmaker said on Thursday it would increase its stake in its venture with Brilliance China Automotive Holdings Ltd to 75% from 50%, with the deal closing in 2022 when rules capping foreign ownership for all auto ventures are lifted.

The move will likely spur BMW to shift more production to China, helping to protect profits amid a whipsawing trade war between Washington and Beijing that has raised the cost of BMW importing cars manufactured at its U.S. plant in South Carolina.

The deal also marks a milestone for foreign carmakers which have been capped at owning 50% of any Chinese venture and have had to share profits with their local partner, and could encourage rivals such as Mercedes maker Daimler.

“We are now embarking on a new era,” BMW Chief Executive Harald Krueger said in a speech in Shenyang, northeast China, where the joint venture is based. He thanked Chinese Premier Li Keqiang, whom he said “personally supported” the plan.

Evercore ISI analyst Arndt Ellinghorst called the deal a major breakthrough. “In the future, BMW will have the full control over the biggest regional profit pool of its business,” he wrote.

Beijing has been keen for global carmakers to invest more in China and has also eased restrictions that cap foreign ownership of electric vehicle businesses at 50%.

The joint venture plans to add a new plant, spending over three billion euros on a large-scale expansion of the existing production facility, Krueger said.

Yale Zhang, head of Shanghai-based consultancy Automotive Foresight, said: “Others will follow over time, but the divorce schedule depends on how strong or capable the local partner is.”

Daimler's Chief Executive Dieter Zetsche told Reuters last week that recent signals from the Chinese authorities were encouraging, but the German carmaker did not yet have legal permission to make a move.

“If we do, we need to see what opportunities there are,” Zetsche said at the Paris Motor Show, adding any steps depended on talks with BAIC Motor Corp, Daimler's partner in joint venture Beijing Benz.

As trade tensions have escalated, China's government has pledged to open up its markets more widely, including cutting taxes on imported vehicles, cancer medicines and a range of consumer goods.

The country's leaders have also played up other milestone deals such as German chemical maker BASF winning approval in July to build China's first wholly foreign-owned chemicals complex.

The rule changes have already helped Tesla Inc gain Beijing's approval for a wholly-owned manufacturing and sales company in Shanghai, the first time a foreign carmaker will be able to establish a full presence in China without a partner.

BMW is one of the biggest exporters of vehicles from the United States to China, putting it firmly in the crosshairs of the trade war.

“Given the trade dispute between the U.S. and China, there is a powerful incentive for automakers to produce vehicles in the market where they sell them,” said independent auto industry analyst James Chao.

He said control of the joint venture could spur BMW to bring production of models like the BMW X4, X5 and X6 sport utility vehicles, which are currently built in the United States, to China.


But if the move is a big win for BMW, it spells a diminished role for its Hong Kong-listed partner.

Brilliance, which makes the vast majority of its revenue from BMW-branded cars, has seen its shares tumble nearly 50% this year on talk that such a deal was in the offing. Its shares were suspended on Thursday.

Brilliance Chairman Qi Yumin lauded the venture's past success and said the future offered further opportunities, in comments posted on the firm's WeChat account. He added that while the situation was complex, the partners would need to “stick together through thick and thin”.

A number of carmakers said earlier this year they had no immediate plans to change their Chinese joint venture structures despite the planned rule changes.

But Chinese demand for mass-market passenger cars has fallen, increasing the dependence of some local players such as BAIC on income from ventures with premium brands like Daimler.

Industry insiders and analysts fear sales could fall this year for the first time in decades. China auto sales dropped in July and August.

BMW finance chief Nicolas Peter, however, said the firm remained bullish about its top market.

“Number one reason why we invest in China is because we are absolutely convinced the market has a further growth potential,” Peter said in an interview at the Shenyang event. He said the firm was also investing in extra capacity in the United States.

The term of the joint venture will also be extended to 2040 from 2028.

MAHB records 2.0pc passenger growth in September 2018

KUALA LUMPUR, Oct 10 — Malaysia Airports Holdings Bhd’s (MAHB) network of airports recorded 10.8 million passenger movements in September 2018, a two per cent year-on-year (y-o-y) growth. In a filing with Bursa Malaysia today, MAHB said…

Mexico president-elect eyes Slim, others to complete airport

MEXICO CITY, Oct 9 — Mexican President-elect Andres Manuel Lopez Obrador floated the possibility yesterday of having business leaders, including billionaire Carlos Slim, complete a new Mexico City airport if it gets taxpayers off the hook….

TUI group to set up office in Malaysia

KUALA LUMPUR, Oct 8 — TUI Group, one of the world’s largest tour operators, has been given the nod to set up its own travel agency in Malaysia. The Germany-based company received the inbound, outbound and ticketing licences from the Tourism,…

Lim: RM5.22 bln saved in MRT2 construction cost

KUALA LUMPUR: The government saved RM5.22 billion, or 23 per cent of the cost of building the Mass Rapid Transit 2 (MRT2) project through renegotiation with MMC-Gamuda Joint Venture, the project delivery partner (PDP). Finance Minister Lim Guan Eng said this was achieved after the Ministry of Finance, together with the Attorney-General’s Chamber, the Ministry of […]