AUTOMAKERS
Hyundai expects slowdown
South Korea’s biggest automaking group, which last year faced a consumer backlash in China over tensions between the two countries, forecast a slowdown in sales this year, as political risks dent demand for its vehicles in the world’s major markets. Hyundai Motor Co and affiliate Kia Motors Corp yesterday said their combined sales last year dropped 7 percent to 7.25 million units, the least in five years and 1 million short of its record target. Citing stalling global economic growth, rising protectionism and dangers posed by geopolitics as threats, the companies set a goal to sell 7.55 million vehicles this year. With Ford Motor Co on its heels, Hyundai Motor group is fighting to maintain its rank as the world’s fifth-biggest automaker after underperforming rivals in the US.
ENERGY
BP to take tax hit from US
British energy major BP PLC yesterday said that it expected to take a US$1.5 billion hit from US President Donald Trump’s tax reforms. “The lowering of the US corporate income tax rate to 21 percent requires revaluation of BP’s US deferred tax assets and liabilities,” the company said in a statement. “The current estimated impact of this will be a one-off non-cash charge to the group income statement of around [US] $1.5 billion that will impact BP’s fourth quarter 2017 results.” However, the energy giant cautioned that longer-term earnings would be “positively impacted” by the US changes. The reform taxes these earnings at 15.5 percent on cash and equivalents and 8 percent on real estate and other illiquid assets.
SOCIAL MEDIA
WeChat denies storing chats
Tencent Holdings’ (騰訊) WeChat, China’s most popular messenger app, yesterday denied storing users’ chat histories, after a top businessman was quoted in media reports as saying he believed Tencent was monitoring everyone’s account. “WeChat does not store any users’ chat history. That is only stored in users’ mobiles, computers and other terminals,” WeChat said in a post on the social media platform. “WeChat will not use any content from user chats for big data analysis. Because of WeChat’s technical model that does not store or analyze user chats, the rumor that ‘we are watching your WeChat everyday’ is pure misunderstanding.” Li Shufu (李書福), chairman of Geely Holdings (吉利控股), owner of the Volvo car brand, was quoted in Chinese media on Monday as saying Tencent chairman Ma Huateng (馬化騰) “must be watching all our WeChats every day.”
SINGAPORE
Economy solid at end of year
The economy finished last year on a solid footing, allowing more room for policymakers as they consider raising taxes and tightening monetary policy this year. Growth was faster than economists predicted last quarter, resulting in the strongest full-year expansion in three years, preliminary figures released yesterday showed. The data also confirmed the recovery is broadening out, with services industries, such as finance and transport, among the main drivers of growth in the fourth quarter. GDP rose at a seasonally adjusted and annualized rate of 2.8 percent in the fourth quarter from the previous three months; median estimate of eight economists in a Bloomberg survey was for a 1.6 percent gain. GDP climbed 3.1 percent from a year earlier. Singapore, among Asia’s most export-reliant economies, has benefited from a global trade recovery that has boosted demand for its electronics goods.
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