© Reuters. A electric vehicle charger is seen as a vehicle charges in Manhattan, New York, U.S., December 7, 2021. REUTERS/Andrew Kelly
By Paul Lienert
(Reuters) – German industrial giant Siemens AG (OTC:SIEGY) is investing more than $100 million in Volkswagen AG (OTC:VWAGY)’s Electrify America unit, becoming the first outside investor in the North American network of electric vehicle charging stations.
Including new funds from its parent Volkswagen (ETR:VOWG_p), the Electrify America unit would receive a total injection of $450 million, the companies said.
The partnership in Electrify America is “part of a much larger investment that Siemens is making in the electrification market,” said John DeBoer, head of the Siemens’ North American e-mobility unit.
Electrify America was established by VW in 2017 with a 10-year, $2-billion investment commitment in the wake of the German automaker’s diesel emissions cheating scandal.
The two companies did not specify the exact amount each is contributing to the latest investment, other than to say Siemens’ share is more than $100 million.
Siemens, which is making the investment through financing arm Siemens Financial Services, will be a minority investor with a seat on Electrify America’s board.
A year ago, Reuters reported that VW intended to sell a stake in Electrify America as the automaker hoped to attract up to $1 billion in outside funding to help expand infrastructure for electric vehicles.
In an interview, Giovanni Palazzo, Electrify America president and CEO, said the company still plans to more than double its charging infrastructure to 1,800 charging stations and more than 10,000 fast chargers by 2026.
Electrify America has EV charging partnerships with a broad array of vehicle manufacturers outside the Volkswagen Group, including Ford Motor (NYSE:F) Co, Hyundai/Kia, BMW, Mercedes-Benz, Geely Automobile’s Volvo and Polestar, and Tesla (NASDAQ:TSLA) rival Lucid.
Siemens, which builds charging stations for commercial fleets and other customers, has invested in several electrification companies, including Swedish battery startup Northvolt and wireless charging startup WiTricity, as well as Electrify America competitor ChargePoint, according to investor website PitchBook.
Morgan Stanley: bear market rally to continue
One of Wall Street’s best-known bears, Michael Wilson, thinks the S&P 500 will rise another 7% before turning down, so the bear market rally will continue for now, writes Market Watch.
After the Dow Jones, S&P 500 and Nasdaq Composite joined their strongest weekly gains since at least May last Friday, Wilson, who is chief strategist and head of U.S. equity markets at Morgan Stanley (NYSE:MS), told clients that there could be another 5% to 7% before the downward trajectory of U.S. stocks resumes during the latest bear market recovery.
Wilson has held a bearish view of the stock market for about 2 years and correctly predicted a sell-off this year.
Wilson explained in a research note sent out to clients on Monday that a pullback in the 38-50% drop in the stock market this year “would not seem like something unnatural, not consistent with the previous bear market rally.”
While growth concerns have triggered a sell-off in commodities and lowered inflation expectations, the fact that the U.S. economy is already slowing and heading toward recession means that any market rally is likely to be short-lived, and U.S. stocks are likely to eventually fall.
Wilson mentioned in the note that the bear market is not over yet, although it may appear otherwise in the next few weeks as the market takes the rate cut as a sign that the Fed can still manage a “soft landing” and prevent a meaningful revision to earnings forecasts.
U.S. stocks rose last week as investors now hope the slowing economy and falling commodity prices may inspire the Fed to raise interest rates less sharply. Federal funds futures, a derivative used by investors to bet on the pace of the Fed’s monetary policy changes, estimate with a high probability that the Fed will be forced to start cutting interest rates again as soon as next summer.
They also consider the lower peak in the federal funds rate: it will peak around 3.5% at the end of 2022 instead of 3.75% just a couple of weeks ago. Wilson also pointed out the drop in Treasury yields: the 10-year Treasury bond yield went from 3.230% to a low of 3.07% on Friday before rebonding again on Monday.
Wilson expects the S&P 500 index to fall to around 3,400 points if the U.S. Federal Reserve manages to get a “soft landing” for the economy — which Fed Chairman Jerome Powell said last week would be “a very difficult thing to do.”
Wilson expects that if the U.S. economy plunges into recession, the S&P 500 index will fall to around 3,000 points. In any case, Wilson believes that U.S. stocks are still highly valued because the risk premium — that is, the measure of compensation that investors receive for the extra risk of owning stocks instead of bonds — remains about 300 basis points higher than the 10-year Treasury bond yield, which is considered a “risk-free rate.”
Easing chip shortages to help Volkswagen in H2 – CEO
© Reuters. FILE PHOTO: Volkswagen logo is pictured at the 2022 New York International Auto Show, in Manhattan, New York City, U.S., April 13, 2022. REUTERS/Brendan McDermid/File Photo
BERLIN (Reuters) – Volkswagen (ETR:VOWG_p) sees a strong second half of 2022 and expects progress in catching up with rival Tesla (NASDAQ:TSLA) as easing chip shortages start to offset supply chain bottlenecks and rising costs, the carmaker’s CEO said on Tuesday.
“We are earning more than ever,” Chief Executive Herbert Diess said at a works meeting, adding Volkswagen is ramping up electric vehicle volumes in its biggest markets in Germany and China thanks to easing semiconductor shortages.
This should allow the carmaker to narrow the Volkswagen-Tesla gap this year and meet its goal of becoming market leader by 2025 if it seizes the moment while the U.S. electric car maker burns cash on large investments, the CEO said.
“Elon (Musk) has to ramp up two highly complex factories in Austin and Gruenheide at the same time – as well as expand production in Shanghai. That’s going to take strength out of him,” Diess said.
Reliance Chairman Mukesh Ambani steps down as director of telecom arm
© Reuters. FILE PHOTO: Mukesh Ambani, Chairman and Managing Director of Reliance Industries, arrives to address the company’s annual general meeting in Mumbai, India July 5, 2018. REUTERS/Francis Mascarenhas
BENGALURU (Reuters) – Reliance Industries Chairman Mukesh Ambani has stepped down as director of Reliance Jio Infocomm Ltd, the conglomerate’s telecom arm said on Tuesday.
Reliance Jio said https://refini.tv/3Nrs773 it has appointed Mukesh’s son and non-executive director Akash Ambani as the chairman of its board. Akash has been involved with the telecom unit since its launch in late 2016, where he started as a director.
India’s telecoms sector had been upended after the entry of Jio, which triggered a price war that forced some rivals out of the market and turned profits into losses.
Jio, which started out offering mobile teleservices, has been aggressively investing in services like internet broadband and forging ties with handset makers to launch low-cost smartphones and providing 5G services.
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