Multinational Corporation Dynamics [2018.10.25]
Volkswagen, a joint venture between German Volkswagen and China's SAIC Group, has started building a 17 billion yuan (2.5 billion US dollars) new energy vehicle factory in Shanghai, which will produce products from Volkswagen's luxury car brand Audi. The new factory will have an annual production capacity of 300000 vehicles and will be put into operation starting from 2020. After the completion of the new factory, it will produce multiple pure electric models such as Audi, Volkswagen, and Skoda based on the MEB platform, to assist Volkswagen in entering the rapidly developing new energy market in China. The MEB platform is a new generation platform specifically designed for pure electric vehicles by Volkswagen.
German automaker Daimler has announced that it will establish a high-end car travel joint venture with China's Geely Holding Group. Both parties will each hold 50% of the shares in the new company. The initial models include Daimler's Mercedes Benz S-Class, E-Class, and V-Class models, as well as Maybach cars, but the joint venture's vehicles will not be limited to Mercedes Benz cars. Geely has launched Cao Cao's special car travel service in the local market of China, with over 17 million registered users in 28 cities
The London electric vehicle company, owned by China Automotive Group Zhejiang Geely Holding Group, announced on Thursday that black taxis from London will be driven into Paris next year, after obtaining approval from the Paris government to operate this iconic taxi locally. LEVC plans to introduce its flagship TX eCity model to Paris in the first half of 2019, continuing its global expansion pace; This model is an electric version of the well-known London black taxi. The company's taxis have already entered Amsterdam, Berlin, Hamburg, and Oslo.
French Renault and its Chinese partner Brilliance Automobile Group plan to launch three electric van delivery vehicles within two years. The joint venture between Renault and Brilliance, Brilliance Renault Jinbei Automobile Co., Ltd., announced on Tuesday that it will launch seven light commercial vehicles, including the three electric vehicles mentioned above. The joint venture was established in December last year. There will be two electric vehicles, namely the commercial vehicle and passenger vehicle of Brilliance's Jinbei Automobile. Another Renault car powered by batteries will be launched in 2020. Renault expects the growth momentum of commercial vehicle sales to remain strong, with sales expected to increase by 11% to 3.2 million units this year and further increase by 8-9% in 2019.
Mitsubishi Motors' joint venture in China will produce a new type of electric vehicle (EV). This move aims to launch a popular new sport utility vehicle (SUV) in the Chinese market to increase sales. Mitsubishi will also start producing engines at new local factories in an attempt to strengthen the Chinese market. The new car will be produced at the factory of the local joint venture company GAC Mitsubishi Motors in Changsha, Hunan Province, and sold under the GAC Mitsubishi brand. According to China's fuel efficiency measurement standards, the new car has a range of 410 kilometers on one charge.
Brazilian National Petroleum Corporation and China National Petroleum Corporation (CNPC) have signed an agreement to study the economic feasibility of completing the construction of the Comperj refinery in Rio de Janeiro. This marks another step forward for China towards establishing a foothold in the refining industry in the Americas. Once the research is completed, both parties will establish a joint venture to complete the construction of the refinery. Petrobras will hold 80% equity, while China National Petroleum Exploration and Development Corporation (CNODC), a subsidiary of China National Petroleum Corporation, will hold 20% equity.
General Electric's new CEO, Larry Culp, stated on Wednesday that he will abide by his predecessor's work commitments in France, otherwise he will be punished. When General Electric acquired Alstom's energy business in 2015, it promised a net increase of 1000 jobs by the end of this year. In June of this year, former CEO Flannery of General Electric stated that this goal was 'out of reach', and the French government raised the possibility of imposing a fine of 50000 euros on every job that was not created.
American pharmaceutical company Pfizer plans to reduce the global workforce by approximately 2% through voluntary retirement and layoffs this year and early next year. Pfizer hopes to streamline the company structure and eliminate some management roles. Pfizer has approximately 90000 employees worldwide.
Meng unconditionally approved Microsoft's $7.5 billion acquisition of GitHub. The European Commission stated in a statement that the merger of Microsoft and GitHub will not raise competitive concerns, as the new entity after the merger will continue to face strong challenges from competitors in the market. Microsoft announced in June this year that it would acquire GitHub for $7.5 billion in stock. GitHub is a leading global software development platform with over 28 million developer users.
JPMorgan Chase CEO Jamie Dimon has never felt shy about his jealousy of Silicon Valley. In an effort to keep up with the changes in digital payments, JPMorgan Chase will build a fintech park in Silicon Valley, which will accommodate over 1000 employees in one of the most expensive locations in the United States, San Francisco Palo Alto. Damon stated that the bank has nearly 50000 technical personnel and is investing in artificial intelligence and machine learning to reduce risks and improve underwriting, while also establishing cloud infrastructure. The Financial Technology Park is planned to open in 2020. Previously, JPMorgan Chase had acquired WePay, a payment startup.
American Express and PayPal have stated that they will expand their strategic partnership and improve the experience of American Express cardholders using PayPal and Venmo. The new partnership plan will allow American Express members to use their membership points to purchase products from PayPal merchants online, and will allow members to transfer funds through PayPal or Venmo on American Express's mobile applications. Members will also be able to use PayPal or Venmo balances to pay American Express bills.
Standard Chartered is preparing for a new round of layoffs to reduce costs and respond to investors' concerns about performance. Standard Chartered may announce layoffs when it releases its third quarter results later this month. The bank plans to lay off no more than 300 employees in the Middle East and Africa, and will partially freeze recruitment and restrict employee travel.
Malaysian state-owned oil company Petronas has agreed to acquire approximately 10% of the shares in Oman's natural gas field. This will give Petronas a place in one of the largest hydraulic fracturing projects outside the United States. The project was developed by BP PLC with an investment of $12 billion last year. BP's partner in the project, Oman Oil Company, holds a 40% stake in the natural gas field and has been seeking to sell some of its shares.
According to a new stock exchange interconnection mechanism between London and Shanghai, HSBC is expected to become the first foreign company to trade on a Chinese exchange. The purpose of the 'Shanghai London Stock Exchange' is to enable global investors to buy stocks of Chinese listed companies and give Chinese investors the opportunity to buy stocks of companies listed on the London Stock Exchange (LSE) and Shanghai Stock Exchange (SSE) through interconnection. After years of planning, HSBC's plan to list and issue CDRs in Shanghai is seen as a symbolic listing transaction.
China National Offshore Oil Corporation Limited and Royal Dutch Shell Group signed a memorandum of understanding on the cooperation of Huizhou Petrochemical Project in The Hague, Netherlands on the 16th. At present, Shell and CNOOC jointly operate a world-class Nanhai Petrochemical Joint Plant in Dayawan District, Huizhou City, Guangdong Province. The second phase project - the second ethylene cracking unit with a capacity of 1.2 million tons per year - was officially put into operation in May this year, and the factory's production capacity has doubled. The project also includes the largest styrene and propylene oxide (SMPO) production unit in China.
ExxonMy, the world's largest listed oil and gas company, is making a big bet on China's surging demand for liquefied natural gas, combining the global production projects of billions of dollars with the company's first storage and distribution center in Chinese Mainland. The company's natural gas strategy is advancing on two tracks: expanding production of supercooled natural gas in places such as Papua New Guinea and Mozambique, while creating demand for these supplies by opening ExxonMobil's first import and storage center in China.
Swiss pharmaceutical giant Novartis has announced a $2.1 billion acquisition of cancer focused biotechnology company Endocell Inc. The board of directors of Endocyte has approved the transaction.
Starbucks announced that Beijing and Shanghai have basically completed the coverage of its 'Special Star Delivery' stores throughout the city. On October 22nd, 'Special Star Delivery' will officially enter nine cities, including Guangzhou, Shenzhen, Chengdu, Hangzhou, Tianjin, Nanjing, Wuhan, Ningbo, and Suzhou. Starbucks will work together to provide customers with a high-quality delivery experience. By the end of this year, Starbucks will complete the 'Special Star Delivery' landing plan for over 2000 stores in 30 cities across the country. Starbucks has also launched trial operations in Shanghai and Hangzhou through another dedicated delivery channel outside of its 'Third Space' stores - the exclusive Star Delivery 'Star Chef Delivery' jointly innovatively created with Hema.
Sam's Club, Wal Mart's membership warehouse retailer, said Thursday that its grocery delivery service through Instacart will expand to 90 new markets by the end of October. Prior to this, Sam's Club teamed up with Instaart to pilot delivery services in Fort Worth and Austin, Texas, as well as in St. Louis, San Diego, and Los Angeles.
Huawei Technologies will open a new information security laboratory in Bonn, Germany next month and conduct source code reviews, aiming to win the trust of regulatory agencies before bidding for 5G mobile spectrum in Germany. The opening of Huawei's laboratory coincides with the German Federal Network Regulatory Agency (BNetzA), also headquartered in Bonn, finalizing the terms for its planned 5G license issuance in the first quarter of 2019. The total cost of constructing a 5G network in Germany may reach as high as 80 billion euros (92 billion US dollars), which is a huge investment for Huawei, the world's largest supplier, and its competitors Ericsson, Nokia, ZTE, and Samsung.
Midea Group, a major Chinese home appliance manufacturer, has announced a restructuring plan to acquire its controlling subsidiary, Little Swan, through a stock exchange merger. The two sides aim to integrate resources under a global strategy. This time, Midea Group issued shares to all other exchange shareholders of Little Swan, except for Midea Group and its wholly-owned subsidiary TITONI, in exchange for their A-share and B-share holdings of Little Swan. The value of this merger is RMB 14.383 billion. Little Swan has a leading advantage in the field of washing machines, while Midea Group is a diverse consumer electronics company that also engages in robotics and automation systems, intelligent supply chain (logistics), and more.