JAPAN
Factory output increases
Factory output expanded the most in more than a year in May, signaling fresh resilience despite a global economic slowdown and rising trade tensions. Separate data showed core inflation in Tokyo weakened to 0.9 percent this month. Industrial production rose 2.3 percent from a month earlier, beating the 0.7 percent gain estimated by economists, according to the Japanese Ministry of Economy, Trade and Industry. Output increased despite an extended public holiday at the start of the month and an escalation of the US-China trade war. The auto sector was a big driver of the expansion in production, with output rising 5.2 percent from the previous month. Auto shipments in May rose 6 percent from a month earlier. Some economists cited demand for vehicles and other big-ticket items ahead of a sales tax increase in October as a possible factor.
AUTOMAKERS
Regulator might fine Nissan
The Securities and Exchange Surveillance Commission aims to fine Nissan Motor Co more than ¥2 billion (US$18.6 million) for allegedly under-reporting the pay of the firm’s former chairman, Carlos Ghosn, a person familiar with the matter said. The commission is to start an investigation into the automaker in July or August, the person said, asking not to be identified, because the matter is private. Depending on the outcome of that probe, the watchdog could recommend that the Financial Services Agency impose a fine on Nissan, the person said. Representatives for the commission and Nissan declined to comment. Japanese newspaper Asahi first reported the fine being sought on June 26.
UNITED STATES
Growth forecast to slow
The economy grew at a healthy 3.1 percent rate in the first three months of this year, but signs are mounting that growth has slowed sharply this quarter amid slower global growth and a confidence-shaking trade battle between the US and China. The gain in the gross domestic product, the broadest measure of economic health, was unchanged from an estimate made a month ago, the Department of Commerce reported on Thursday. However, the components of growth shifted slightly with stronger business investment and consumer spending slowing more than previously estimated. Economists believe growth has slowed sharply in the current April-to-June quarter to about 2 percent. They expect similar meager gains for the rest of the year, a forecast that runs counter to the government’s expectations of strong growth above 3 percent.
ELECTRONICS
Canon fined over merger
Canon Inc was fined 28 million euros (US$31.9 million) by the European Commission for moving forward with a takeover of Toshiba Corp’s medical systems unit before seeking merger approval. The Japanese firm deployed a tactic known as “warehousing” that was aimed at circumventing requirements to file for approval, the EU’s antitrust arm said in a statement. The EU has come down hard on companies that do not strictly follow its merger rules, fining Facebook Inc for providing misleading information during the 2014 review of its WhatsApp takeover. It also fined Altice NV last year for similar “gun-jumping” when it implemented its takeover of PT Portugal before it received permission. Altice is challenging the EU decision in court. In Thursday’s case, the commission said that, as a first step, an interim buyer purchased 95 percent of the capital of the unit for 800 euros, while Canon paid 5.28 billion euros for the remaining 5 percent stake.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
MAJOR BENEFICIARY: The company benefits from TSMC’s advanced packaging scarcity, given robust demand for Nvidia AI chips, analysts said ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packaging and testing service provider, yesterday said it is raising its equipment capital expenditure budget by 10 percent this year to expand leading-edge and advanced packing and testing capacity amid strong artificial intelligence (AI) and high-performance computing chip demand. This is on top of the 40 to 50 percent annual increase in its capital spending budget to more than the US$1.7 billion to announced in February. About half of the equipment capital expenditure would be spent on leading-edge and advanced packaging and testing technology, the company said. ASE is considered by analysts