Stock Markets
Explainer-What happens as EU concludes investigation of Chinese-made EVs?
By Philip Blenkinsop
BRUSSELS (Reuters) – The European Union formally approved imposing tariffs on Chinese-made electric vehicles (EVs) on Tuesday after an investigation that has divided the bloc and prompted retaliation from Beijing.
The European Commission has set rates ranging from 7.8% for Tesla (NASDAQ:) to 35.3% for China’s SAIC and other producers deemed not to have cooperated with the EU’s anti-subsidy probe. These will be on top of the EU’s standard 10% car import duty.
WHEN AND FOR HOW LONG?
The EU plans to publish its regulation imposing tariffs later on Tuesday or early on Wednesday.
Final or “definitive” tariffs are expected to apply from the following day for five years.
The Commission has decided that provisional duties dating back to July will not be collected. Companies had been able to cover these with a bank guarantee.
The tariff imposition follows a vote on the Commission’s proposal for definitive tariffs by the EU’s 27 members on Oct. 4 – with 10 in favour, five against and 12 abstentions.
CONTINUED TALKS WITH BEIJING
The Commission has said it is willing to continue negotiating an alternative to tariffs with China even after tariffs are imposed. Both sides have agreed to a ninth round of technical negotiations, although the EU said there were “large remaining gaps”.
The EU executive said last month it could re-examine price undertakings – involving minimum import prices and typically volume caps – having previously rejected those Chinese companies have offered.
Previous minimum price deals agreed by the EU have been for homogenous commodities, rather than complex products such as cars. The Commission believes a single minimum price would not be adequate to counter injury caused by subsidies.
It might also have to be different for separate producers, depending on the value of sales and receipt of subsidies.
Beijing has repeatedly warned the Commission against separate negotiations with EV companies. Various manufacturers have authorised the China Chamber of Commerce for Machinery and Electronics to negotiate on their behalf.
The Commission has said any alternative must be in line with World Trade Organization (WTO) rules, adequate to remove the injury due to subsidies, and enforceable.
CHINESE RETALIATION
In moves seen as retaliation, China has launched anti-dumping investigations into EU exports of pork and brandy, and an anti-subsidy probe into EU dairy products, but it has yet to impose any measures.
The EU launched a challenge at the WTO in September against the dairy probe.
China’s Commerce Ministry has also met with automakers and industry associations to discuss raising import duties on large-engined gasoline vehicles, which would hit German producers hardest.
Germany’s exports of vehicles with engines of 2.5 litres or larger to China were worth $1.2 billion last year, Chinese customs data shows.
WHAT HAPPENS AFTER THE INVESTIGATION?
Any company not in the sample group of BYD (SZ:), Geely and SAIC that wishes to have its own individual duty can ask for an “accelerated review” just after the imposition of definitive measures. Such a review should last a maximum of nine months.
The Commission can also carry out an “interim review” after a year has elapsed if the measures are no longer necessary or if they are not sufficient to counteract subsidies.
The Commission often looks into whether producers are evading duties via exports of parts for assembly elsewhere. For the EU, such circumvention exists if 60% or more of the value of parts are imported from the country subject to duties and if the value added in the assembly is no more than 25%.
Companies can dispute the measures at the European Court of Justice. China has already launched a challenge at the WTO. Both legal paths can take well over a year.
The Commission has said it is confident its investigation and measures are compatible with WTO rules.
Investing.com — Needham on Friday initiated its coverage on On Holding AG (NYSE:) with a “buy” rating and a target price of $64.
Brokerage said On has shown industry-leading growth, with impressive revenue increases and healthy margin expansion. The company is likely to keep growing as it increases brand awareness and gains space with top sneaker retailers worldwide.
“We believe the company has a continued runway for strong growth, as they increase brand awareness and gain shelf space with the biggest and best sneaker retailers in the world,” analyst Tom Nikic wrote in the note.
Needham analyst noted that Roger Federer-backed On was valued at 5 times its expected 2025 revenues, which make stock may seem expensive but strong fundamentals could support continued stock momentum.
“Although valuation metrics are lofty, we believe the shares can continue to exhibit momentum as long as fundamentals”
ON is the fastest growing company in Needham’s coverage, with expected 32% revenue growth in 2024. Its Direct-to-Consumer (DTC) growing 43% year-to-date, compared to 24% growth for wholesale sales.
Brokerage highlighted despite this growth, the brand’s awareness is still relatively low. In major markets like the U.S., U.K., France, and Australia, awareness was under 10% a year ago. However, it’s increasing rapidly, with U.S. awareness doubling to around 20%, and tripling in France.
Stock Markets
Toll Brothers Announces Final Opportunity at Verona Estates Community in Chatsworth, California
CHATSWORTH, Calif., Nov. 22, 2024 (GLOBE NEWSWIRE) — Toll Brothers , Inc. (NYSE:), the nation’s leading builder of luxury homes, today announced the final opportunity to own a new home at Verona Estates, an exclusive gated community in Chatsworth, California. Only a few homes remain available for sale in this prestigious community, including the professionally decorated Siena Modern Farmhouse model home.
The intimate gated enclave of Verona Estates is a rare find showcasing award-winning architecture and innovative home designs. Nestled in an established Chatsworth neighborhood south of the Santa Susana Mountains and adjacent to the Vineyards at Porter Ranch, this exceptional community offers a serene and relaxed atmosphere with the convenience of nearby shopping and easy access to freeways, entertainment, and recreation.
Toll Brothers residents in Verona Estates will enjoy distinctive architecture, quality craftsmanship, luxurious home designs with open floor plans, expansive home sites, and proximity to the future 50-acre Porter Ranch community park. Verona Estates offers generous two-story home designs ranging from 4,700 to 6,000+ square feet, with 5 to 6 bedrooms, 4.5 to 6.5 bathrooms, and 3-car garages. The homes also feature popular floor plan options including prep kitchens, guest suites, floating staircases, indoor and outdoor fireplaces, and more. Move-in ready homes in the community are priced from $1,979,995.
We are thrilled to offer the final opportunity to own a home in the exclusive Verona Estates community, said Nick Norvilas, Division President of Toll Brothers in Los Angeles. The Siena model home is a showcase of luxury and design, and we encourage interested home buyers to visit and experience this exceptional home along with the final few quick move-in homes remaining in the community firsthand.
The Siena Modern Farmhouse model home features designer upgrades throughout, including fully landscaped and furnished interiors, offering an unparalleled living experience. The professionally decorated model home is priced at $2,999,995.
For more information, call 844-700-8655 or visit TollBrothers.com/LA. The Sales Center for Verona Estates is located at 20508 Edgewood Court in Chatsworth and is open by appointment only.
About Toll Brothers
Toll Brothers, Inc., a Fortune 500 Company, is the nation’s leading builder of luxury homes. The Company was founded 57 years ago in 1967 and became a public company in 1986. Its common stock is listed on the New York Stock Exchange under the symbol TOL. The Company serves first-time, move-up, empty-nester, active-adult, and second-home buyers, as well as urban and suburban renters. Toll Brothers builds in over 60 markets in 24 states: Arizona, California, Colorado, Connecticut, Delaware, Florida, Georgia, Idaho, Indiana, Maryland, Massachusetts, Michigan, Nevada, New Jersey, New York, North Carolina, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Virginia, and Washington, as well as in the District of Columbia. The Company operates its own architectural, engineering, mortgage, title, land development, smart home technology, and landscape subsidiaries. The Company also develops master-planned and golf course communities as well as operates its own lumber distribution, house component assembly, and manufacturing operations.
In 2024, Toll Brothers marked 10 years in a row being named to the Fortune World’s Most Admired Companies™ list and the Company’s Chairman and CEO Douglas C. Yearley, Jr. was named one of 25 Top CEOs by Barron’s magazine. Toll Brothers has also been named Builder of the Year by Builder magazine and is the first two-time recipient of Builder of the Year from Professional Builder magazine. For more information visit TollBrothers.com.
From Fortune, ©2024 Fortune Media IP Limited. All rights reserved. Used under license.
Contact: Andrea Meck | Toll Brothers, Director, Public Relations & Social Media | 215-938-8169 | ameck@tollbrothers.com
A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/cbb8cf4a-a018-4df0-955e-3cf4ab63edeb
Sent by Toll Brothers via Regional Globe Newswire (TOLL-REG)
Verona Estates by Toll Brothers
Toll Brothers announced the final opportunity to own a new home at Verona Estates, including the designer-decorated Siena model home, in Chatsworth, California.
Source: Toll Brothers, Inc.
By Marie Mannes, Alessandro Parodi and Stine Jacobsen
STOCKHOLM/GDANSK (Reuters) – Northvolt’s financial collapse deals a blow to Europe’s plan to set up its own battery industry to power electric cars, stirring a debate about whether it needs to do more to attract investment as startups struggle to catch up with Chinese rivals.
Europe’s biggest hope for an electric vehicle battery champion filed for U.S. Chapter 11 bankruptcy protection on Thursday after talks with investors and creditors including Volkswagen (ETR:) and Goldman Sachs for funding failed.
The Swedish company, whose motto is “make oil history”, has received more than $10 billion in equity, debt and public financing since its 2016 start-up. Volkswagen and Goldman Sachs each own about one fifth of its shares.
Northvolt said on Friday it needed $1.0-$1.2 billion in new funds under the restructuring process, which it hopes will end by the end of March.
In recent months, it has shrunk the business and cut jobs in a bid to shore up its finances. But it has struggled to produce sufficient volumes of high-quality batteries, and lost a 2 billion euro ($2.1 billion) contract from BMW (ETR:) in June.
That has left Europe’s ambitions to build its own battery industry looking a distant dream.
In recent years, Northvolt led a wave of European startups investing tens of billions of dollars to serve the continent’s automakers as they switch from internal combustion engines to electric vehicles.
But growth in EV demand is moving at a slower pace than many in the industry projected, and China has taken a huge lead in powering EVs, controlling 85% of global battery cell production, International Energy Agency data shows.
Making batteries and cells, the units that store and convert chemical energy into electricity, is a delicate process and doing so at scale is a challenge for any battery maker.
Northvolt has missed some in-house targets and curtailed production at its battery cells plant in northern Sweden, underscoring the difficulties, Reuters reported on Monday.
“The biggest issue is that batteries are not easy to make and Northvolt haven’t satisfied the supply demands of their customers – that is a management issue,” said Andy Palmer, founder of consultancy Palmer Automotive said.
“The Chinese are technologically 10 years ahead of the West in batteries. That’s a fact,” he said.
At least eight companies have postponed or abandoned EV battery projects in Europe this year, including China’s Svolt and joint venture ACC (NS:), led by Stellantis (NYSE:) and Mercedes-Benz (OTC:).
In 2024, Europe’s battery pipeline capacity out to 2030 has fallen by 176 gigawatt-hours, according to data firm Benchmark Minerals. That’s equivalent to almost all the current installed capacity in Europe, according to Reuters calculations.
RETHINK
Some executives say Europe should do more to attract and support home-grown projects so they can compete with Chinese rivals such as CATL and BYD (SZ:).
“Europe needs to rethink how it supports a nascent sector before China eats up the entire value chain, which is due to smart planning,” said James Frith, European head of Volta Energy Technologies, which specialises in battery and energy storage technology.
Among its $5.8 billion in debts, Northvolt owes the European Investment Bank (EIB) some $313 million.
EIB vice president Thomas Östros said it had been a constructive partner to Northvolt, but it needed to safeguard the EIB and EU’s interests.
“It remains the case that Europe has a strategic interest in a European battery industry for electric cars and we will follow developments very closely. But it is much to early to say what the outcome will be,” he said.
The Swedish government has repeatedly said it does not plan to take a stake in Northvolt.
On Friday, Northvolt’s outgoing CEO and co-founder Peter Carlsson said he was a “little worried” Europe is giving up on its dream of competing with China.
He said Europe would regret it in 20 years time if it retreated.
“It’s not a straight journey and right now, we’re all in a bit of a down in that journey where there’s more hesitations, there’s more questions on the speed of the transition from the carmakers, from policymakers, from the investor community,” he told reporters in a call.
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