Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., July 21, 2022. REUTERS/Brendan McDermid
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Walmart cuts profit forecast; news hits retailers
McDonald’s up as sales, profit top estimates
Coca-Cola up on forecast raise
Indexes down: Dow 0.8%, S&P 500 1.3%, Nasdaq 2%
NEW YORK, July 26 (Reuters) – U.S. stocks were sharply lower on Tuesday afternoon, with Nasdaq down more than 2%, as a profit warning by Walmart dragged down retail shares and fueled fears about consumer spending.
Walmart (WMT.N) shares fell 8% after the retailer cut its full-year profit forecast late on Monday. Walmart blamed surging prices for food and fuel, and said it needed to cut prices to pare inventories. read more
Shares of Target Corp (TGT.N) declined 3.8% and Amazon.com Inc (AMZN.O) dropped 5.1%. read more
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Also, Amazon said it would raise fees for delivery and streaming service Prime in Europe by up to 43% a year. read more
Amazon was among the biggest drags on the Nasdaq and S&P 500, while consumer discretionary (.SPLRCD) fell more than 3% and led declines among S&P 500 sectors.
“The majority of companies that reported today beat earnings, and that’s been the case. But of course there have been some warnings, and that’s what the market is focusing on,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.
“Walmart basically pulled the plug, and most retailers are lower across the board.”
Meanwhile, Coca-Cola Co (KO.N) gained 1.9% after the company raised its full-year revenue forecast. McDonald’s Corp (MCD.N) rose 3% after beating quarterly expectations. read more
A busy week for earnings includes reports from Alphabet Inc (GOOGL.O) and Microsoft Corp (MSFT.O) after the bell. Microsoft was down 3.4% and Alphabet was down 2.9%.
The Dow Jones Industrial Average (.DJI) fell 239.66 points, or 0.75%, to 31,750.38, the S&P 500 (.SPX) lost 52.28 points, or 1.32%, to 3,914.56 and the Nasdaq Composite (.IXIC) dropped 239.38 points, or 2.03%, to 11,543.29.
The Federal Reserve started a two-day meeting and on Wednesday, it is expected to announce a 0.75 percentage point interest rate hike to fight inflation. read more Investors have worried that aggressive interest rate hikes by the Fed could tip the economy into recession.
Earnings from S&P 500 companies are expected to have risen 6.2% for the second quarter from the year-ago period, according to Refinitiv data.
Among the week’s heavy slate of economic news, data Tuesday showed U.S. consumer confidence dropped to nearly a 1-1/2-year low in July, pointing to slower economic growth at the start of the third quarter. read more
Advance second-quarter GDP data on Thursday is likely to be negative after the U.S. economy contracted in the first three months of the year.
Declining issues outnumbered advancing ones on the NYSE by a 1.82-to-1 ratio; on Nasdaq, a 1.51-to-1 ratio favored decliners.
The S&P 500 posted 1 new 52-week highs and 30 new lows; the Nasdaq Composite recorded 32 new highs and 123 new lows.
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Additional reporting by Shreyashi Sanyal and Aniruddha Ghosh in Bengaluru; Editing by Arun Koyyur, Anil D’Silva and David Gregorio
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International economic forum June 15-18 in St Petersburg
No Western bigwigs at ‘Russian Davos’ due to sanctions
Putin to give big speech June 17, speak to media – aide
June 14 (Reuters) – Russia for years hosted world leaders and business titans at its annual economic forum in St Petersburg, but the “Russian Davos” will see little of the global financial elite this year with Moscow isolated by sanctions over its actions in Ukraine.
This week, to make up for the lack of major Western attendees, Russia is giving pride of place to smaller players or countries like China – the world’s second largest economy – that have not joined in sanctions.
“Foreign investors are not only from the United States and European Union,” Kremlin spokesperson Dmitry Peskov told reporters on Tuesday, pointing to the Middle East and Asia.
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President Vladimir Putin will give a major speech on Friday focusing on the international economic situation and Russia’s tasks in the near future, Interfax news agency cited Kremlin aide Yuri Ushakov as saying.
He will also meet media on the sidelines of the forum at about 8 p.m. Moscow time (1600 GMT) that day, he said.
The Kremlin launched the St Petersburg International Economic Forum (SPIEF) in 1997 to attract foreign investment, discuss economic policy and project an image it was open for business after the demise of Soviet rule.
Russia long compared SPIEF with the World Economic Forum, the annual blue-ribbon event for global VIPs held in the Swiss Alpine resort of Davos.
Now, with Western leaders shunning dealings with Russia, Putin will have no traditional meeting with political movers and shakers and corporate bigwigs from the United States and Europe.
There were no names of U.S. and European companies or their CEOs on the published schedule for the June 15-18 SPIEF – reflecting fears of punishment under the most sweeping sanctions regime ever imposed on a major power.
Even companies that have hung on in Russia despite the general exodus of Western investors were not listed.
Ushakov said high-level delegations from more than 40 nations were expected while 1,244 Russian and 265 foreign companies had confirmed they would be there.
In one exception to the absence of Western figures, the head of the American Chamber of Commerce in Russia along with French and Italian counterparts will speak at a session on Thursday called “Western Investors in Russia: New Reality.”
TOXIC RELATIONS
Russia’s relations with the West have turned toxic since it sent armoured forces into Ukraine on Feb. 24 in what it calls a “special military operation” to remove threats to its security. Ukraine and its Western backers call Russia’s actions an unprovoked invasion aimed at grabbing territory.
SPIEF will therefore look and feel very different.
Having once welcomed then- German chancellor Angela Merkel, ex-IMF chief Christine Lagarde, Goldman Sachs’ Lloyd Blankfein, Citi’s Vikram Pandit and ExxonMobil’s Rex Tillerson, Russia will give top billing this week to the presidents of allied states Kazakhstan and Armenia.
Egyptian President Abdel Fattah al-Sisi will address the meeting via video link, RIA news agency cited Ushakov as saying.
As foreign companies write down billions of their once promising Russian investments, domestic firms and banks are rushing to take over businesses left behind. read more
“Sanctions are for the long haul. Globalisation as it used to be has ended,” Andrey Kostin, CEO of sanctioned bank VTB, Russia’s second-largest, told RBC business daily.
‘NEW OPPORTUNITIES IN A NEW WORLD’
In past years, SPIEF’S sessions would focus on investment-oriented topics such as privatisation by Moscow and initial public offerings (IPOs).
This year, SPIEF’s official title is “New Opportunities in a New World”. Session topics include new possibilities for Russian economic growth, improving trade with the five non-Western BRICS powers and the future of Russia’s sanctioned financial sector.
Another session – “A new form of international cooperation: how will payments be made?” – touches on Russia’s ejection from the global SWIFT payment system and its move to circumvent the ban by demanding payments for gas exports in roubles. It will have speakers from allies Cuba and Venezuela as well as Turkey and Egypt, which have also eschewed sanctions.
There will be a session on “fake news” – a panel attended by state media, the General Prosecutor’s Office and the Foreign Ministry as Moscow pursues an information war with the West.
Other countries sending officials to attend or speak there via videolink include China, Belarus, Central African Republic, India, Iran, Nicaragua, Serbia and the United Arab Emirates.
Some participants asked their employers’ names not be printed on their personal badges, RBC reported, citing Rosgoncress, the state company organising the forum.
“Money loves silence now as never before,” said Denis Denisov, head of the Russian branch of international advisory firm EM.
($1 = 57.4500 roubles)
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Reporting by Reuters
Editing by Mark Heinrich and Grant McCool
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LOS ANGELES, June 8 (Reuters) – President Joe Biden announced on Wednesday a proposed new U.S. economic partnership with Latin America aimed at countering China’s growing clout as he kicked off a regional summit marred by discord and snubs over the guest list.
Hosting the Summit of the Americas in Los Angeles, Biden sought to assure the assembled leaders about his administration’s commitment to the region despite nagging concerns that Washington, at times, is still trying to dictate to its poorer southern neighbors.
The line-up of visiting heads of state and government in attendance was thinned down to 21 after Biden excluded Cuba, Venezuela and Nicaragua, prompting Mexican President Andres Manuel Lopez Obrador and several other leaders to stay away in protest.
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“We have to invest in making sure our trade is sustainable and responsible in creating supply chains that are more resilient, more secure and more sustainable,” Biden told a gala opening ceremony.
Biden is seeking to present Latin American countries with an alternative to China that calls for increased U.S. economic engagement, including more investment and building on existing trade deals.
However, his “Americas Partnership for Economic Prosperity,” which still appears to be a work in progress, stops short of offering tariff relief and, according to a senior administration official, will initially focus on “like-minded partners” that already have U.S. trade accords. Negotiations are expected to begin in early fall, the official added.
Biden outlined his plan as he launched the summit, which was conceived as a platform to showcase U.S. leadership in reviving Latin American economies and tackling record levels of irregular migration at the U.S.-Mexico border.
But his agenda has been undermined by the partial boycott by leaders upset at Washington’s decision to cut out its main leftist antagonists in the region.
As a result, Biden found himself welcoming a larger-than-normal contingent of foreign ministers sitting in for their national leaders as the arriving dignitaries walked one-by-one up a red carpet flanked by a military honor guard.
U.S. officials hope the summit and a parallel gathering of business executives can pave the way for greater cooperation as governments grappling with higher inflation work to bring supply chains stretched by the COVID-19 pandemic closer to home.
Biden also used his speech to preview a summit declaration on migration to be rolled out on Friday, calling it “a ground-breaking, integrated new approach” with shared responsibility across the hemisphere. But he provided few specifics.
Even as Biden deals with priorities such as mass shootings, high inflation and the Ukraine war, the U.S. official said the president is seeking to press the administration’s competitive goals against China with the launch of the new partnership for the region.
The U.S. plan also proposes to revitalize the Inter-American Development Bank and create clean energy jobs
Still, the administration appeared to be moving cautiously, mindful that an initiative that promotes jobs abroad could face U.S. protectionist pushback.
CHINA’S CHALLENGE
The challenge from China is clearly a major consideration.
China has widened the gap on the United States in trade terms in large parts of Latin America since Biden came into office in January 2021, data show.
An exclusive Reuters analysis of U.N. trade data from 2015-2021 shows that outside of Mexico, the top U.S. trade partner, China has overtaken the United States in Latin America and increased its advantage last year. read more
“The best antidote to China’s inroads in the region is to ensure that we are forwarding our own affirmative vision for the region economically,” the administration official said.
Biden’s aides have framed the summit as an opportunity for the United States to reassert its leadership in Latin America after years of comparative neglect under his predecessor Donald Trump.
But diplomatic tensions broke into the open this week when Washington opted not to invite the three countries it says violate human rights and democratic values.
Rebuffed in his demand that all countries must be invited, Lopez Obrador said he would stay away, deflecting attention from the U.S. administration’s goals and toward regional divisions.
Biden’s national security adviser Jake Sullivan told reporters the choice by some leaders not to attend reflected their own “idiosyncratic decisions” and that substantive work would still be accomplished.
Cuban President Miguel Diaz-Canel said the United States lacked “moral authority” to lecture on democracy and thanked Lopez Obrador for his “solidarity.”
The leaders of Guatemala and Honduras, two of the countries that send most migrants to the United States, also stayed home, raising questions about the significance of the coming joint migration declaration.
Still, leaders from more than 20 countries, including Canada, Brazil and Argentina, are attending the summit, hosted by the United States for the first time since its inaugural session in 1994.
Biden will use a meeting on Thursday with Brazilian President Jair Bolsonaro to talk about climate change and will also discuss the topic of “open, transparent and democratic elections” in Brazil. read more
Bolsonaro, a populist admirer of Trump who has had chilly relations with Biden, has raised doubts about Brazil’s voting system, without providing evidence, ahead of October elections that opinion polls show him losing to leftist rival Luiz Inacio Lula da Silva.
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Reporting by Trevor Hunnicutt, Daina Beth Solomon, Matt Spetalnick, Dave Graham, Humeyra Pamuk; Additional reporting by Jeff Mason, Steve Holland and Dave Sherwood; writing by Matt Spetalnick and Dave Graham; Editing by Grant McCool and Richard Pullin
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UVALDE, Texas, May 26 (Reuters) – The gunman in the Texas school massacre barged unchallenged through an unlocked door, then killed 19 children and two teachers while holed up in their classroom for an hour before a tactical team stormed in and killed him, police said on Thursday.
The latest official details from the Texas Department of Public Safety (DPS) on Tuesday’s mass shooting differed sharply from initial police accounts and raised questions about security measures at the elementary school and the response of law enforcement.
The school district in Uvalde, Texas, about 80 miles (130 km) west of San Antonio, has a standing policy of locking all entrances, including classroom doors, as a safety precaution. But one student told Reuters some doors were left unlocked the day of the shooting to allow visiting parents to come and go for an awards day event.
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The newly detailed chronology came hours after videos emerged showing desperate parents outside Robb Elementary School during the attack. They pleaded with officers to storm the building, and some fathers had to be restrained.
The human toll of the rampage, which ranks as the deadliest U.S. school shooting in nearly a decade, deepened with news that the husband of one of the slain teachers died of a heart attack on Thursday while preparing for his wife’s funeral. read more
At a briefing for reporters, DPS spokesperson Victor Escalon said the gunman, Salvador Ramos, 18, made his way unimpeded on to the school grounds after crashing his pickup truck nearby. The carnage began 12 minutes later.
Preliminary police reports had said that Ramos, who drove to the school from his home after shooting and wounding his grandmother there, was confronted by a school-based police officer as he ran toward the school. Instead, no armed officer was present when Ramos arrived at the school, Escalon said.
The suspect crashed his pickup truck nearby at 11:28 a.m. (1628 GMT), opened fire on two people at a funeral home across the street, then scaled a fence onto school property and walked into one of the buildings through an unlocked rear door at 11:40 a.m. (1640 GMT), Escalon said.
Two responding officers entered the school four minutes later but took cover after Ramos fired multiple rounds at them, Escalon said.
The shooter then barricaded himself inside the fourth-grade classroom of his victims, mostly 9- and 10-year-olds, for an hour before a U.S. Border Patrol tactical team breached the room and fatally shot him, Escalon said. Officers reported hearing at least 25 gunshots coming from inside the classroom early in the siege, he said. read more
‘TOUGH QUESTION’
The hour-long interval before border agents stormed in appeared to be at odds with an approach adopted by many law enforcement agencies to confront “active shooters” at schools immediately to stop bloodshed.
Asked if police should have made en masse entry sooner, Escalon answered, “That’s a tough question,” adding that authorities would offer more information as the investigation proceeded.
He described a chaotic scene after the initial exchange of gunfire, with officers calling for backup and evacuating students and staff.
Crosses with the names of victims of a school shooting, are pictured at a memorial outside Robb Elementary school, after a gunman killed nineteen children and two teachers, in Uvalde, Texas, U.S. May 26, 2022. REUTERS/Marco Bello
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In one video posted on Facebook by a man named Angel Ledezma, parents can be seen breaking through yellow police tape and yelling at officers to go into the building.
“It’s already been an hour, and they still can’t get all the kids out,” Ledezma said in the video. He did not immediately respond to a request for comment.
Another video posted on YouTube showed officers restraining at least one adult. One woman can be heard saying, “Why let the children die? There’s shooting in there.”
“We got guys going in to get kids,” one officer is heard telling the crowd. “They’re working.”
‘AWARDS DAY’
Investigators were still seeking a motive, Escalon said. Ramos, a high school dropout, had no criminal record and no history of mental illness. Minutes before the attack, however, he had written an online message saying he was about to “shoot up an elementary school,” according to Governor Greg Abbott.
The gunman’s father, also named Salvador Ramos, 42, expressed remorse for his son’s actions in an interview published Thursday by news site The Daily Beast.
“I just want the people to know I’m sorry, man, [for] what my son did,” he was quoted as saying. “He should’ve just killed me, you know, instead of doing something like that to someone.”
In one of the more chilling accounts of the shooting, a fourth-grade boy who was in the classroom told local TV station KENS5 that the gunman announced his presence when he entered by crouching slightly and saying, “It’s time to die.”
Why a rear door to the school building would be left unsecured remained under investigation, Escalon said.
Miguel Cerrillo, 35, and his 8-year-old daughter, Elena, a third-grader at Robb, said the door the shooter used was usually locked.
“But that day they were not locked because it was awards day, and some parents were coming in through those doors,” said Elena, who was in the school at the time of the shooting. “The parking was really packed in front so people were parking back there and using that door.”
At least 17 people, including children, were also injured in the massacre.
The attack, coming 10 days after 10 people were killed by an 18-year-old gunman in a supermarket in Buffalo, New York, has reignited a national debate over firearms. U.S. President Joe Biden and fellow Democrats have vowed to push for new gun restrictions, despite resistance from Republicans. read more
Biden is due to travel Uvalde on Sunday.
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Reporting by Gabriella Borter and Brad Brooks in Uvalde, Texas; additional reporting by Brendan O’Brien in Chicago, Doina Chiacu in Washington, Andrew Hay in Taos, New Mexico and Costas Pitas in Los Angeles; writing by Joseph Ax and Steve Gorman; editing by Cynthia Osterman and Stephen Coates
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WASHINGTON, May 18 (Reuters) – President Joe Biden took steps on Wednesday to address the shortage of infant formula in the United States, invoking the Defense Production Act to help manufacturers obtain the ingredients needed to ramp up supply, the White House said.
Biden also directed U.S. agencies to use Defense Department commercial aircraft to bring formula into the United States from overseas.
Baby formula aisles at U.S. supermarkets have been decimated since top U.S. manufacturer Abbott Laboratories (ABT.N) in February recalled formulas after complaints of bacterial infections.
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On Monday, Abbott said it had reached an agreement with the U.S. health regulator to resume production of baby formula at its Michigan plant, a major step toward resolving the nationwide shortage.
In a letter to Health and Human Services Secretary Xavier Becerra and Agriculture Secretary Tom Vilsack, Biden noted that the industry should be producing more formula in the coming weeks and months.
Empty shelves show a shortage of baby formula at CVS in San Antonio, Texas, U.S. May 10, 2022. REUTERS/Kaylee Greenlee Beal
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“Imports of baby formula will serve as a bridge to this ramped-up production. Therefore I am requesting you take all appropriate measures available to get additional safe formula into the country immediately,” he said.
The White House said Biden was invoking the Defense Production Act to ensure manufacturers have the ingredients to make safe formula.
“The president is requiring suppliers to direct needed resources to infant formula manufacturers before any other customer who may have ordered that good,” the White House said.
In addition, he launched “Operation Fly Formula” to hasten imports of infant formula and get more formula to stores quickly.
Biden has directed HHS and USDA to use military commercial aircraft to pick up overseas infant formula that meets U.S. health and safety standards.
“Bypassing regular air freighting routes will speed up the importation and distribution of formula and serve as an immediate support as manufacturers continue to ramp up production,” the White House said.
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Reporting by Eric Beech and Steve Holland; Editing by Tim Ahmann and David Gregorio
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Empty shelves show a shortage of baby formula at a Target store in San Antonio, Texas, U.S. May 10, 2022. REUTERS/Kaylee Greenlee Beal
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NEW YORK, May 13 (Reuters) – Perrigo Company PLC (PRGO.N), which makes store-brand baby formulas for retailers including Walmart Inc (WMT.N) and Amazon.com Inc (AMZN.O) expects shortages and heightened demand to last for the “balance of the year,” said CEO Murray Kessler in an interview with Reuters.
Perrigo’s formula manufacturing facilities in Ohio and Vermont are now running at 115% of capacity, Kessler said. At the request of the U.S. Food and Drug Administration, the company is making only four items, the store-brand versions of Similac Pro Sensitive and Pro Advance and Enfamil Gentle Ease and Infant, Kessler said. Perrigo also has a smaller business making some national formula brands including Bobbie.
The closure of Abbott Laboratories’ (ABT.N)infant-formula plant in Sturgis, Michigan, exacerbated national pandemic-related shortages, leading to empty shelves in big box stores and supermarkets and panicked parents. Abbott’s brands include Similac formulas.
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Perrigo is working with retailers including Walmart and Target Corp (TGT.N) so they “get something each week,” Kessler said. Retailers’ allocations are based on an average of what the retailers received prior to “this crisis,” he said.
“We have stepped up and are killing ourselves to do everything we can,” Kessler said.
Some retailers including CVS Health Corp (CVS.N) and Target are rationing baby formula.
The White House on Thursday announced steps taking to alleviate the shortage, including permitting more imports.
French food and beverage company Danone SA(DANO.PA), which also makes infant formulas,said the “unexpected Abbott Nutrition recall in February has led to a surge in demand in the U.S. market.
“We are in discussions with the U.S. authorities to see how we can support them in addressing their shortages.”
Of the total U.S. baby formula market, Perrigo makes up roughly 8%, Kessler said, adding that it has gained share as it has worked to satisfy the soaring demand.
Due to “massive inflation,” Perrigo raised prices by about 3% in the first quarter, Kessler said.
The company has ordered materials to meet the heightened level of demand throughout the year, he said.
Bobbie, a European-style infant formula new to the market, saw its customer count double the first week after the recall of Abbott formulas, and it has continued to climb, CEO Laura Modi told Reuters. Perrigo manufacturers Bobbie’s formula, but can only meet about 50% of the company’s demand, Modi said, leading it to stop taking new customers. Perrigo can meet 100% of Bobbie’s current customer needs, she said.
Bobbie has about 70,000 customers.
Abbott closed its manufacturing facility in Michigan after complaints of bacterial contamination.
The FDA later cited five bacterial infections reported in babies given the company’s formula, including two deaths. Abbott has said its plants are “not likely the source of infection” and is planning on re-opening the facility in the next two weeks.
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Reporting by Jessica DiNapoli in New York and Richa Naidu in London
Editing by Nick Zieminski
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A trader works on the trading floor at the New York Stock Exchange (NYSE) in Manhattan, New York City, U.S., May 5, 2022. REUTERS/Andrew Kelly/Files
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A look at the day ahead in markets from Dhara Ranasinghe.
When the blue-chip Dow Jones index slides more than 1,000 points on one day, U.S. Treasury yields jump as much as 20 basis points and Britain’s pound drops more than 2%, you’d be forgiven for thinking that investors have gone into a sell everything mode.
But with the safe-haven dollar at 20-year highs, there was at least one asset benefiting from Thursday’s market mayhem.
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For sure, waters seem calmer as European trading gets underway, although Asia shares slumped overnight.
Having breathed a sigh of relief that the Federal Reserve didn’t opt for a massive 75 bps rate hike at this week’s meeting, in a change of mind investors fretted that aggressive rate hikes – like the 50 bps move the Fed delivered – could trigger a sharp economic slowdown or recession.
Adding to the volatility was a surge in U.S. real or inflation-adjusted bond yields, which rose to their highest since early 2020 .
The Bank of England warning of recession risk and inflation rising above 10% only exacerbated concerns about the growth outlook, sparking the biggest one-day drop since March 2020 (and we all remember why that month stands out, right?)
Given that it’s non-farm payrolls day in the United States, Friday’s trading session may not bring a quiet end to the week.
Economists polled by Reuters predict the U.S. economy created a solid 391,000 new jobs in April, versus 431,000 a month earlier.
The unemployment rate is expected to fall to 3.5%, which would make a pre-pandemic low.
The jobs data, alongside next week’s U.S. inflation data , should help frame the debate over the Fed policy outlook.
Key developments that should provide more direction to markets on Friday:
– Tokyo consumer prices rise at fastest pace in 7 years read more
– ECB must quickly raise key rates, says head of Germany’s Ifo institute –
– Swedish Central Bank minutes
– Federal Reserve Bank of New York President John Williams
– U.S. non-farm payrolls
– Brazil April CPI
– European earnings: Adidas, IAG, Amadeus, Intesa San Paulo, Beazley
– U.S. earnings: CIGNA, Goodyear
US non-farm payrolls
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Reporting by Dhara Ranasinghe, editing by Karin Strohecker
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DETROIT/BEIJING, March 25 (Reuters) – A year ago Tesla dismissed the alternative path of electric car battery swapping as “riddled with problems and not suitable for widescale use”. It seems Beijing disagrees.
In fact, China is pushing hard for swappable batteries for electric vehicles (EVs) as a supplement to regular vehicle charging, with the government throwing its weight behind several companies advancing the technology.
Four companies – automakers Nio and Geely, battery swap developer Aulton and state-owned oil producer Sinopec (600028.SS) – say they plan to establish a total of 24,000 swap stations across the country by 2025, up from about 1,400 today.
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Battery swapping allows drivers to replace depleted packs quickly with fully charged ones, rather than plugging the vehicle into a charging point. Swapping could help mitigate the growing strains placed on power grids as millions of drivers juice up, yet specialists caution it can only take off in a big way if batteries become standardized industry-wide.
If China is successful in making swapping successful on a large scale, though, the shift could undermine the business models of global brands like Tesla, Volkswagen and General Motors, whose EVs are designed for and powered by their own proprietary batteries and, in Tesla’s case, its own charging network.
Even slight changes of fortune in the country can have significant consequences for these carmakers, whose futures rely on achieving success in the world’s largest car market.
The Chinese swapping plans, announced piecemeal in recent weeks and months but not widely known outside the domestic auto sector, are part of Beijing’s broader plan to make 25% of car sales fully electric by 2025, or more than 6 million passenger vehicles based on current forecasts. Estimates vary widely as to how many will have swappable batteries.
The Ministry of Industry and Information (MIIT), a major supporter of battery swapping, did not immediately respond to a request for further comment about China’s battery swapping strategy
Furthermore, big Chinese players are also looking overseas.
Ningde-based CATL (Contemporary Amperex Technology Company Ltd) (300750.SZ), the world’s biggest battery maker, told Reuters it was developing swapping services not only for China, but “to meet the demand of global markets”.
“We are accumulating experience in the Chinese market and at the same time communicating closely with overseas partners. You’ll receive more concrete information soon,” said CATL, which supplies about half of China’s market and more than 30% of the battery cells used in EVs globally.
Nio, among China’s top EV makers, plans to offer U.S. customers battery-swapping services by 2025, the company’s North American head Ganesh Iyer said. It has more than 800 swap stations in China and has just set up its first in Europe.
‘NEVER GOING TO HAPPEN’
Such plans clash with the views expressed by global EV pioneer and leader Tesla in March 2021 when it dismissed the viability of large-scale battery swapping in China. It trialed swapping in the United States years ago and abandoned it.
Industry executives are divided over whether China’s push can overcome the reluctance of European and U.S. automakers to abandon their own battery designs and adopt standardized ones.
“You’ll never ever get carmakers to agree to swappable batteries,” said Andy Palmer, former CEO of Aston Martin and currently head of EV maker Switch Mobility.
John Holland, wireless EV charging company Momentum Dynamics’ commercial director for Europe and the Middle East, said convergence on batteries created a quandary for automakers.
“Then how do you differentiate your product?”
Tesla (TSLA.O), GM (GM.N) and Volkswagen (VOWG_p.DE) say they are not exploring battery swapping right now.
A GM spokesperson told Reuters that swappable batteries “are not part of our strategy at present.”
A VW spokesperson said the company originally considered battery swapping to avoid waiting times at charging stations, but that advances in fast charging and the lower costs of non-swappable batteries had led it to shift focus to the latter.
“Nevertheless, our strategists closely monitor and evaluate the competitive environment and all developments in this area,” the German carmaker said.
A Tesla spokesperson didn’t immediately respond to a request for comment.
Swapping and regular grid-charging both have critics and cheerleaders in a rapidly evolving auto tech arena.
The ease of exchanging batteries in e-scooters has been demonstrated in Asia and Europe, but the challenge is adapting the technology to larger and more complex cars, trucks and vans. See accompanying short story: read more
Concerns about the length of swapping times have also faded, with Nio saying it has automated the process so it takes as little as 90 seconds.
Yet the more familiar grid-charging side has a huge head start, and is bolstered by the fact there’s already billions of dollars’ worth of charging infrastructure built globally.
Automakers are also rolling out EVs with improved batteries that boast longer ranges and shorter charge times, which could make swapping obsolete.
‘BIGGEST GAME IN TOWN’
In China, MIIT released the global auto industry’s first standards for swapping technology last year. They went into effect in November, specifying safety requirements, test methods and inspection rules for EVs with swappable batteries.
The ministry aims to have more than 100,000 battery-swappable vehicles and more than 1,000 swap stations, in total, in 11 cities by 2023; stations in the bigger cities will accommodate both passenger and commercial vehicles, while outlying provincial cities will focus on electric heavy-duty trucks.
Yet a key uncertainty for China’s ambitions is whether enough carmakers adopt standardized batteries, an obstacle that scuttled attempts at battery swapping in the last decade – yet, if overcome, could propel the technology to a viable scale. Read a short history of swappable batteries: read more
There’s a long way to go. Even the swapping option offered to customers by Nio uses the company’s own batteries, thus limiting the service to people driving Nio cars equipped with the company’s proprietary batteries.
CATL, which helped Nio develop swappable batteries, has signed up China’s FAW Motor as the first customer for its new Evogo battery swapping service and expects to extend the service to other Chinese automakers.
CATL wants domestic firms to accept its standard battery design so its stations can service models from multiple brands, according to a person close to the company who declined to be named due to commercial sensitivities, adding that it expected more car brands to adopt its standardized designs.
The company is “the biggest game in town” for EV batteries, said Tu Le, managing director of Sino Auto Insights.
“They can offer a large footprint for swapping stations and a low cost to use those stations,” he said.
Meanwhile, among those Chinese companies building out swap station networks, Shanghai-based Aulton New Energy Automotive Technology has said it is working with automakers to develop standardized batteries, and with Sinopec to install stations at 30,000 Sinopec gas stations in China by 2030.
Aulton didn’t respond to a request for comment.
MAGIC IN AMERICA?
While international carmakers may resist swappable batteries, they are reliant on Chinese sales to fund their costly transition to electric and will have little choice but to adapt to the market there, according to many industry experts.
Furthermore, if Beijing ultimately mandates swappable batteries “and starts saying, ‘okay, the only car you’re allowed to produce is one that meets the standard’ . . . you would have to comply to stay in business” in China, says John Helveston, assistant professor at George Washington University’s School of Engineering.
Some advocates of swapping are looking beyond China.
Battery swapping “is too convenient, too economical and too logical for this not to happen at scale in Europe and the United States,” said Levi Tillemann, head of policy and international business at San Francisco-based battery swap startup Ample.
“It’s a sort of magical thinking to imagine that this is a uniquely Chinese phenomenon,” he added.
Ample, one of just a handful of battery swapping developers outside China, has raised $275 million from investors, including energy companies Shell, Repsol and Eneos, boosting its valuation to $1 billion.
It is running pilot programs with Uber (UBER.N) and car rental startup Sally, and says it is collaborating with several unnamed automakers.
“With a relatively small number of vehicles that are heavily utilized, we can deploy and operate a battery swap system profitably,” Tillemann said. “So fleets are a prime target for us.”
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Reporting by Paul Lienert in Detroit, Nick Carey in London and Norihiko Shirouzu in Beijing; Additional reporting by Victoria Valdersee in Berlin; Editing by Pravin Char
Our Standards: The Thomson Reuters Trust Principles.
March 9 (Reuters) – A 57-year-old man with terminal heart disease who made history as the first person to receive a genetically modified pig’s heart died on Tuesday at the University of Maryland Medical Center (UMMC), the hospital said.
David Bennett received the transplant on Jan 7. read more
His condition began deteriorating several days ago, the hospital said in a statement on Wednesday, and he was given “compassionate palliative care” after it became clear that he would not recover.
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Bennett “wasn’t able to overcome what turned out to be the devastating debilitation” caused by the heart failure he experienced before the transplant, Dr. Bartley Griffith, director of the UMCC cardiac transplant program, said in a videotaped statement.
The transplanted heart functioned “beautifully,” Griffith said.
Bennett was able to communicate with his family during his final hours, the hospital said.
Surgeon Muhammad M. Mohiuddin, MD leads a team placing a genetically-modified pig heart into a storage device at the Xenotransplant lab before its transplant on David Bennett, a 57-year-old patient with terminal heart disease, at University of Maryland Medical Center in Baltimore, Maryland, U.S. January 7, 2022. Picture taken January 7, 2022. University of Maryland School of Medicine (UMSOM)/Handout via REUTERS.
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Bennett first came to UMMC as a patient in October and was placed on a heart-lung bypass machine, but was deemed ineligible for a conventional heart transplant.
After Bennett received a pig heart that had been modified to prevent rejection with the use of new gene editing tools, his son called the procedure “a miracle.”
For Bennett, the procedure was his last option.
“Before consenting to receive the transplant, Mr Bennett was fully informed of the procedure’s risks, and that the procedure was experimental with unknown risks and benefits,” the hospital said.
Researchers have long considered pigs to be a potential source of organs for transplants because they are anatomically similar to humans in many ways. Prior efforts at pig-to-human transplants had failed because of genetic differences that caused organ rejection or viruses that posed an infection risk.
“The demonstration that it was possible – that we were able to take a genetically engineered organ and watch it function flawlessly for nine weeks, is pretty positive in terms of the potential for this therapy,” Griffith said.
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Reporting by Kanishka Singh in Bengaluru and Nancy Lapid in New York; Editing by Chizu Nomiyama, Bill Berkrot, Caroline Humer and Robert Birsel
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Feb 16 (Reuters) – The following is a summary of some recent studies on COVID-19. They include research that warrants further study to corroborate the findings and that has yet to be certified by peer review.
Higher estrogen levels tied to lower COVID death risk
A new study strengthens suspicions that the female hormone estrogen protects against death from COVID-19.
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Researchers in Sweden studied 14,685 older women with COVID-19, all of whom were past menopause, during which estrogen levels decline dramatically. Seventeen percent were taking estrogen supplements to relieve menopausal symptoms. After adjusting for other risk factors, women getting extra estrogen had a 53% lower risk of dying from COVID-19 compared to untreated women, the researchers reported on Monday in BMJ Open. Observational studies such as this one cannot prove higher estrogen levels are protective. Furthermore, the women were infected before vaccines were available, said Dr. Malin Sund of Umea University.
“Vaccination has clearly been shown to protect from COVID-19 related mortality and the potential added value from estrogen (in vaccinated women) cannot be estimated from this data,” Sund said. The idea that estrogen might be protective in hospitalized COVID-19 patients is now being tested more rigorously in a randomized controlled trial at Tulane University.
Antacid shows promise against COVID-19 symptoms
In non-hospitalized, unvaccinated adults with mild-to-moderate COVID-19, treatment with a high dose of the antacid drug famotidine helped speed resolution of symptoms and inflammation in a small randomized controlled trial.
Roughly half of those in the 55-patient trial took famotidine – the main ingredient in Johnson & Johnson’s (JNJ.N) widely used over-the-counter Pepsid heartburn drug – three times a day for two weeks. The others took a dummy pill. Patients in the famotidine group had faster resolution of 14 of 16 symptoms assessed in the study, including loss of smell and taste, difficulty breathing and abdominal pain. Famotidine treatment also led to faster improvements in markers of inflammation without any detrimental effects on patients’ immune responses, the researchers reported in the journal Gut. About a third of the study’s participants were Black and a quarter Hispanic.
“We hope that the data we are sharing with this study guide future trials that are necessary to confirm famotidine as a treatment for patients with COVID-19,” study leader Dr. Tobias Janowitz of Northwell Health and Cold Spring Harbor Laboratory said in a news release.
U.S. may have overestimated COVID-19 hospitalizations
U.S. statistics likely overestimate how many patients have been hospitalized for COVID-19, according to a new study.
At 60 hospitals near Boston, Pittsburgh and Chicago, researchers manually reviewed the charts of a random sample of 1,123 patients with confirmed coronavirus infections hospitalized between March 2020 and August 2021. Roughly 1-in-4 patients “actually were admitted for a different problem and should not have been included” in data analytics calculations of the severity of COVID-19, said Dr. Shawn Murphy of Massachusetts General Hospital in Boston. Patients were more likely to have been admitted specifically for COVID-19 when local infection rates were high, his team reported on Tuesday on medRxiv ahead of peer review. When infection rates were low last summer, up to half the patients were hospitalized for other reasons, with SARS-CoV-2 infection found coincidentally on mandatory testing. The researchers were able to identify indicators in patients’ charts that admissions were actually due to COVID-19, such as whether doctors ordered lab tests related to inflammation.
“This study highlights an important weakness in COVID-19 reporting, which might have implications on intensive care utilization, cost analysis, resource planning, and research,” said Jeffrey Klann, also of Mass General. Adding the identified indicators to data analytics software “could help mitigate these problems.”
Click for a Reuters graphic on vaccines in development.
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Reporting by Nancy Lapid and Megan Brooks; Editing by Bill Berkrot
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