ITALY
Economy shrank in Q3
The Italian economy contracted in the third quarter, signaling the country may have entered its fifth recession since 2001 as the government adopts new austerity measures that will further weigh on growth. GDP dropped 0.2 percent from the second quarter, when it grew 0.3 percent, Rome-based national statistics institute Istat said in its final GDP report yesterday. It was the first contraction since the final three months of 2009 and matched the median forecast for a 0.2 percent contraction in a survey of 23 economists by Bloomberg News. The economy expanded 0.2 percent from a year earlier, Istat said. Consumer spending declined 0.2 percent from the second quarter, with investment declining 0.6 percent. Exports grew 1.6 percent in the quarter, while imports fell 1.1 percent.
INDUSTRY
Siemens to cut 1,600 jobs
Siemens AG, Europe’s largest engineering company, plans to cut as many as 1,600 jobs at its health-care division and will scale back the business after falling behind competitors including Roche Holding AG. The planned cuts amount to as much as 8 percent of workers at the diagnostics subsidiary, said Michael Sen, the chief financial officer of the health-care operations. Another 400 jobs will go as Siemens stops making linear accelerators that create radiation for cancer treatment. Order intake and sales at the health-care unit failed to grow in the most recent quarter, and profitability at the diagnostics business has slumped to less than half the rate two years earlier.
AUTOMAKERS
Saab declared bankrupt
Famed Swedish car maker Saab was declared bankrupt by a court on Monday, ending a nine-month survival battle by its Dutch owner. Saab, which has made cars for 64 years, has suffered cash problems since March after last year’s sales fell short of target amid the disruption of its sale by General Motors. It has not made any vehicles since April and several rescue attempts have failed. Saab owner Swedish Automobile said former owner and key licence holder General Motors had blocked a last-ditch rescue plan by Chinese investor Youngman. It also criticized the court-appointed administrator who had been overseeing its creditor protection process and who, it said, had meddled in the deals. Saab proposed a new rescue involving Zhejiang Youngman Lotus Automobile, but that was rejected by GM at the weekend. “That, basically, was the last nail in the coffin of this beautiful company,” Swedish Automobile chief executive Victor Muller told reporters hours after handing in a request to a Swedish court to have Saab made bankrupt. The court later approved the request and appointed two receivers to run the company.
HUNGARY
Interest rate could go up
Hungary may need to raise the EU’s highest benchmark interest rate next year as talks over a bailout stalled and the government and the central bank spar over monetary-policy independence. The Magyar Nemzeti Bank increased the two-week deposit rate by a half-point for a second month to 7 percent yesterday and said it would raise borrowing costs further if country risk worsens. Policymakers also considered a quarter-point increase. The European Commission and the IMF suspended talks on a financial aid package to Hungary last week, citing objections to a draft law on the central bank that they say may undermine policy autonomy. The forint is the worst-performing currency in the world since June 30, Bloomberg data show.
WASHINGTON’S INCENTIVES: The CHIPS Act set aside US$39 billion in direct grants to persuade the world’s top semiconductor companies to make chips on US soil The US plans to award more than US$6 billion to Samsung Electronics Co, helping the chipmaker expand beyond a project in Texas it has already announced, people familiar with the matter said. The money from the 2022 CHIPS and Science Act would be one of several major awards that the US Department of Commerce is expected to announce in the coming weeks, including a grant of more than US$5 billion to Samsung’s rival, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), people familiar with the plans said. The people spoke on condition of anonymity in advance of the official announcements. The federal funding for
HIGH DEMAND: The firm has strong capabilities of providing key components including liquid cooling technology needed for AI servers, chairman Young Liu said Hon Hai Precision Industry Co (鴻海精密) yesterday revised its revenue outlook for this year to “significant” growth from a “neutral” view forecast five months ago, due to strong demand for artificial intelligence (AI) servers from cloud service providers. Hon Hai, a major assembler of iPhones that is also known as Foxconn, expects AI server revenues to soar more than 40 percent annually this year, chairman Young Liu (劉揚偉) told investors. The robust growth would uplift revenue contribution from AI servers to 40 percent of the company’s overall server revenue this year, from 30 percent last year, Liu said. In the three-year period
LONG HAUL: Largan Energy Materials’ TNO-based lithium-ion batteries are expected to charge in five minutes and last about 20 years, far surpassing conventional technology Largan Precision Co (大立光) has formed a joint venture with the Industrial Technology Research Institute (ITRI, 工研院) to produce fast-charging, long-life lithium-ion batteries for electric vehicles, mobile electronics and electric storage units, the camera lens supplier for Apple Inc’s iPhones said yesterday. Largan Energy Materials Co (萬溢能源材料), established in January, is developing high-energy, fast-charging, long-life lithium-ion batteries using titanium niobium oxide (TNO) anodes, it said. TNO-based batteries can be fully charged in five minutes and have a lifespan of 20 years, a major advantage over the two to four hours of charging time needed for conventional graphite-anode-based batteries, Largan said in a
Taiwan is one of the first countries to benefit from the artificial intelligence (AI) boom, but because that is largely down to a single company it also represents a risk, former Google Taiwan managing director Chien Lee-feng (簡立峰) said at an AI forum in Taipei yesterday. Speaking at the forum on how generative AI can generate possibilities for all walks of life, Chien said Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) — currently among the world’s 10 most-valuable companies due to continued optimism about AI — ensures Taiwan is one of the economies to benefit most from AI. “This is because AI is