Carrefour SA, the world's biggest retailer after Wal-Mart Stores Inc, plans to increase revenue from Asia by opening more stores in the region as sales in its home market France slow.
"Asia is our real engine of growth," Carrefour Chief Executive Jose Luis Duran, 40, said yesterday in Bangkok, where he headed a French delegation aimed at boosting trade with Thailand. "The only thing I can anticipate is probably half of the new stores to be opened in 2005 and 2006 are going to come in Asia," he said.
Asia makes up 7 percent of revenue at Paris-based Carrefour, which has about 10,000 stores on three continents. Second-half profit fell 23 percent to 853 million euros (US$1.14 billion), partly because of writedowns in Japan, where Carrefour is selling its stores after failing to make them profitable.
"We are not going to exit any other market in Asia," Duran said. "We are No. 1 in Taiwan, in China, in Indonesia."
Soaring economic growth, particularly in China, is boosting incomes and allowing people to eat better and buy pricier imported goods. China's economic growth reached 9.5 percent last year. Per capita disposable incomes in urban areas, home to a third of the nation's 1.3 billion people, rose 7.7 percent in real terms to 9,422 yuan (US$1,138) last year.
"In China, we have 59 hypermarkets and around 200 hard discount stores," Duran said. "We are pretty happy with how we are developing two of our main formats, the hypermarkets and the hard discount stores." Carrefour, which opened 15 hypermarkets last year in China, plans to open a similar number this year there, adding about 200,000m2 (2.2 million square feet) of sales area, Duran said.
Overall retail sales in China sales climbed 13.6 percent in the first two months of this year as rising incomes spurred spending in the world's most-populous nation.
Rising spending is prompting companies including LVMH Moet Hennessy Louis Vuitton SA and Wumart Stores Inc to expand in China, helping sustain economic growth amid a government clampdown on investment in industries including real estate, autos and steel. Premier Wen Jiabao (
In Thailand, Carrefour ranks No. 4 with 20 stores, after Tesco Plc, the largest UK food retailer, and Big C Supercenter Pcl, the Thai unit of Casino Perrachon SA of France.
"We are opening around three to four new hypermarkets a year," Duran said. "The target is to reinforce our investments in Thailand. If we could open more, we are going to open all what can be approved by the government." Tesco has 49 hypermarkets, each spanning as much as 12,000m2, 16 smaller supermarkets and 50 convenience stores.
Big C plans to spend 3 billion baht (US$77 million) this year to add four stores for a total of 44, Chief Financial Officer Rumpa Kumhomruen said on March 9.
In France, Carrefour said it will concentrate on reviving stores in that country and in Europe after price cuts failed to halt a drop in market share to the benefit of competitors such as E. Leclerc.
Carrefour, like German retailer KarstadtQuelle AG, has suffered as consumer spending in Europe has stagnated, hurt by an unemployment rate of 8.8 percent. Retail sales in the dozen nations sharing the euro fell by the most last year, the Bloomberg purchasing managers index showed.
MULTIFACETED: A task force has analyzed possible scenarios and created responses to assist domestic industries in dealing with US tariffs, the economics minister said The Executive Yuan is tomorrow to announce countermeasures to US President Donald Trump’s planned reciprocal tariffs, although the details of the plan would not be made public until Monday next week, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. The Cabinet established an economic and trade task force in November last year to deal with US trade and tariff related issues, Kuo told reporters outside the legislature in Taipei. The task force has been analyzing and evaluating all kinds of scenarios to identify suitable responses and determine how best to assist domestic industries in managing the effects of Trump’s tariffs, he
TIGHT-LIPPED: UMC said it had no merger plans at the moment, after Nikkei Asia reported that the firm and GlobalFoundries were considering restarting merger talks United Microelectronics Corp (UMC, 聯電), the world’s No. 4 contract chipmaker, yesterday launched a new US$5 billion 12-inch chip factory in Singapore as part of its latest effort to diversify its manufacturing footprint amid growing geopolitical risks. The new factory, adjacent to UMC’s existing Singapore fab in the Pasir Res Wafer Fab Park, is scheduled to enter volume production next year, utilizing mature 22-nanometer and 28-nanometer process technologies, UMC said in a statement. The company plans to invest US$5 billion during the first phase of the new fab, which would have an installed capacity of 30,000 12-inch wafers per month, it said. The
Taiwan’s official purchasing managers’ index (PMI) last month rose 0.2 percentage points to 54.2, in a second consecutive month of expansion, thanks to front-loading demand intended to avoid potential US tariff hikes, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. While short-term demand appeared robust, uncertainties rose due to US President Donald Trump’s unpredictable trade policy, CIER president Lien Hsien-ming (連賢明) told a news conference in Taipei. Taiwan’s economy this year would be characterized by high-level fluctuations and the volatility would be wilder than most expect, Lien said Demand for electronics, particularly semiconductors, continues to benefit from US technology giants’ effort
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his