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Ford Motor Co. late Tuesday swung to a quarterly profit and reported a 20% rise in sales, but the stock fell 1.4% in the extended session as Wall Street seemed to question Ford’s unchanged guidance.
Ford F “delivered a solid quarter while making real progress on our Ford+ growth plan,” Chief Executive Jim Farley said in a call with analysts following results.
“I…
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Tesla
shares have been on a wild ride lately as investors debate profit margins, price cuts and EV demand. Predicting what’s next is no easy task given all that, plus rising interest rates and persistent inflation. Stock charts and stock seasonality can help investors get a sense of whether or not they should just sell in May and come back and revisit shares later in the year.
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Self-driving-technology company
Mobileye Global
reported a disappointing quarter, and cut full-year financial guidance. The electric-vehicle price war, being led by
Tesla
is the main reason.
Mobileye
stock (ticker: MBLY) is down significantly in Thursday trading, falling more than 23%. The
S&P 500
and
Nasdaq Composite
are up about 0.6% and 0.9%, respectively.
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Price wars have consequences, even for Tesla, the world’s most valuable car company.
Tesla‘s (ticker: TSLA) first-quarter earnings, reported Wednesday evening, met expectations, but its first-quarter automotive gross profit margins were bad. No matter how investors slice and dice the numbers, results will leave them with questions about EV demand and Tesla’s pricing strategy.
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Tesla Inc. stock dropped more than 6% in the extended session Wednesday after the electric-vehicle maker narrowly missed quarterly expectations for its revenue and saw adjusted profit margins drop as it cut its EV prices.
Tesla
TSLA,
earned $2.5 billion, or 73 cents a share, in the first quarter, compared with $3.3 billion, or 95 cents a share, in the year-ago period. Adjusted for one-time items, the company earned 85 cents a share.
Revenue rose 24% to $23.3 billion. Ebitda profit margins dropped to 18.3%, from nearly 27% in the year-ago quarter, while operating margins dropped to 11%.
“We are taking a view that we want to keep making as many cars as we can,” Chief Executive Elon Musk said on a call with analysts after the results. “It’s a good time to increase our lead further.”
Analysts polled by FactSet expected Tesla to report adjusted earnings of 85 cents a share on sales of $23.6 billion. Adjusted profit margins were seen at around 20%.
Tesla’s margins “are still among the best in the industry,” Musk said on the call, adding that Tesla is betting that going for higher volumes and a larger EV fleet, one that in the future would be fully autonomous, are the right choices at the moment.
Later on in the call, Musk said he expects Teslas to be capable of being fully autonomous vehicles later this year. Musk has made similar, and ultimately unrealized, predictions on numerous other occasions.
The CEO also deflected a few follow-up questions around demand, commodity prices and other aspects of the business, saying in several instances that he lacked a “crystal ball” to peer through the future.
In a letter to shareholders accompanying results, Tesla said it expects “ongoing cost reduction of our vehicles, including improved production efficiency at our newest factories and lower logistics costs, and remain focused on operating leverage as we scale.”
The company unveiled a fresh round of U.S. price cuts earlier Wednesday in a bid to boost demand amid concerns of a weakening economy, but that are also bound to cut into its profit margins.
Pricing will continue to “evolve upwards or downwards, depending on a number of factors,” the company said in the letter.
The drop in Ebitda profit margin to 18.3% “doesn’t concern me at this point in time,” since it was reasonably close to expectations, Bill Selesky at Argus Research said after the results. “I don’t see it as a huge miss.”
Profit margins are “still very healthy” compared with others in the auto industry and taking into consideration the economy, said Jeff Windau, an analyst at Edward Jones.
Even as profit margins take a hit, Tesla “will find a way to grow and grow profitably based on past performance and the fact that the business is already EV-ready,” said Alyssa Altman, a consultant at Publicis Sapient who looks into transportation and mobility issues.
“The company has a strong advantage against most other competitors who are either building their presence or recreating their business models to be focused on the EV customer and software product development,” Altman said.
Tesla said it expects to “remain ahead” of its long-term goal of increasing its production rate by 50% annually, producing 1.8 million vehicles in 2023. Tesla has “a shot at 2 million, but that’s the upside case,” Musk said on the call.
The Cybertruck, Tesla’s electric pickup truck, is on track to begin production later in the year at the Texas plant and Tesla continues to “make progress” on its next-generation EV platform, it said in the letter.
Don’t miss: Tesla to break ground at Texas lithium refinery in May
The company ended the quarter with cash and equivalents as well as investments of $22.4 billion, $217 million more than at the end of the fourth quarter.
The economy presents a “unique opportunity” for the company, Tesla said in the letter.
Tesla is aiming “to leverage our position as a cost leader. We are focused on rapidly growing production, investments in autonomy and vehicle software, and remaining on track with our growth investments.”
See also: Here’s how much Tesla short sellers have lost so far this year
In January, Tesla reported operating margins of 16% for the fourth quarter and 16.8% for all of 2022. First-quarter 2022 margins were “over 19%,” Tesla said last April.
Tesla pinned the drop in first-quarter operating margins in part to higher commodities, logistics and warranty prices, lower credit revenue, and increases in ramping up production of new battery cells.
Tesla stock has fallen about 46% in the past 12 months, compared with losses of around 7% for the S&P 500 index
SPX,
So far this year, however, the stock is up 49%, compared with an advance of 8% for the S&P 500.
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Electric vehicle leader
Tesla
is expected to report lower earnings on higher sales Wednesday evening after the electric vehicle maker slashed prices to draw in buyers.
The EV war, with traditional auto makers spending billions to catch
Tesla
(ticker: TSLA), has morphed into a price war. The car maker’s quarterly earnings will help investors figure out who is winning.
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The Biden administration, pushing for more U.S. manufacturing, has issued its updated list of all-electric and gas-electric hybrid vehicles that qualify for the full $7,500 tax credit, and those that can earn at least a partial sweetener for buyers.
With the update, 16 models are now eligible for a full or partial tax credit, based on new thresholds that require a certain percentage of the battery parts and the minerals used in those batteries to come from North America, meaning the U.S., or a country with select trade agreements with the U.S.
The total is down from 25 electric and plug-in models previously eligible for a U.S. tax break, which were first introduced about 10 years ago.
The revision limits the selection to vehicles built by four car companies: Tesla Inc.
TSLA,
Ford Motor Co.
F,
General Motors Co.
GM,
and Stellantis NV
STLA,
which owns Jeep and Chrysler.
See the full list.
The government site also advises on tax incentives for used vehicles and leased vehicles.
For buyers to claim the full $7,500 tax credit, a percentage of the pre-determined battery parts must be made in North America and a percentage of critical minerals sourced in the U.S. or from certain trade-friendly countries. A partial $3,750 credit is available for meeting one of these two battery-sourcing requirements.
Not a single electric model from a foreign brand is eligible for the subsidy as revised. And EVs from startups, such as passenger- and commercial-truck maker Rivian Automotive Inc.
RIVN,
and luxury brand Lucid Group Inc.
LCID,
also missed making the list. That’s largely because their vehicles are too expensive for the price contingencies that inform which autos qualify. Income levels of buyers are also a consideration.
Still, the new rules make for certain immediate winners over others.
Nearly all of GM’s new EV models are eligible for the full $7,500 tax credit. Six Ford electric and plug-in hybrid models also qualify for a partial or full tax credit, including the Mustang Mach-E and F-150 Lightning.
Among Tesla’s models, some entry-level Model 3 sedans will get a $3,750 credit. That is because the car uses battery cells made in China. Higher-end Model 3s and all its Model Y configurations qualify for the full $7,500 credit.
Tesla has been cutting its retail prices, a move to boost sales and bring some offerings in line with the tax breaks. And analysts say the maker likely isn’t done cutting prices.
The tax credits made a big splash when they were included in 2022’s Inflation Reduction Act, the broad spending bill that observers labeled the biggest pro-climate action by an administration to date. But Biden’s pro-America stance soon came in conflict with the heart of the existing EV market, much of which is sourced abroad.
Read: Biden adds more EV charging across U.S., with pledges from Uber, Walmart, PG&E and others
The latest changes, which are intended to attract auto manufacturers into building domestically, apply to vehicles delivered to customers starting Tuesday. Several overseas makers, including Hyundai and Honda, have started to build battery plants in the U.S.
Other actions are intended to push EVs as well. The Environmental Protection Agency last week proposed its toughest restrictions ever on tailpipe emissions, a target that can likely only be met by turning out more EVs from assembly lines. The new standards aim for two-thirds of U.S. car sales to be electric by 2032.
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For anyone watching Netflix, the streaming services’ recent moves to cut costs could mean fewer films, lower-budget shows and — depending on your subscription — more ads. For anyone buying a Tesla, its moves to cut prices will make it easier on customers, but harder on profit-seeking investors.
With both companies reporting results this week, Wall Street will get a look at who still wants a Tesla, amid growing competition, and what kind of growth and viewership anyone can expect from Netflix, as it recalibrates its streaming ambitions and focuses more on profitability following years of rapid growth.
Netflix Inc.
NFLX,
which reports first-quarter results on Tuesday, is trying to crack down on shared accounts, and analysts polled by FactSet see subscriptions coming in well below the average. However, BofA analyst Jessica Reif Ehrlich said that first-quarter results would likely “mark the low point” of the year, “reflecting the initial impact of password sharing efforts in select markets.”
Netflix will report as shareholders’ growing influence over the streaming universe raises questions over what shows and films get streamed, and for how long, as Wall Street tries to wring more bottom-line gains from an industry that boomed before and during the pandemic but burned cash and got crowded in the process. Netflix, along with Walt Disney Co.
DIS,
have laid off employees, while Warner Brothers Discovery Inc.
WBD,
fuses its streaming holdings together.
“We expect Netflix to continue reining in spending, particularly by seeking alternatives to its past practices,” Wedbush analysts Alicia Reese and Michael Pachter wrote in a research note on Thursday. “The company appears to us to be producing fewer feature length films, which we have always viewed as a poor investment, and appears focused on lower cost television content.”
“We are equally encouraged that Netflix is looking at low-cost content like workout videos, which we believe will present a lot of value to subscribers at very low cost,” they added later.
The analysts said that they felt Netflix was well positioned, as other streamers rethink their approach to expansion and financials. And they said Netflix “should be valued as an immensely profitable, slow-growth company.” They also said that Netflix’s decision to launch a cheaper ad-supported option was a “great decision” after growth stalled in the U.S. and Canada and the company’s business in Europe, the Middle East and Africa reaches the saturation point.
For Tesla Inc.
TSLA,
which reports results on Wednesday, the focus for investors will be on price-cutting and its impact on margins. Still, Potter, an analyst at Piper Sandler, has said Tesla is on a “warpath” and “maintaining its aggressive approach to pricing,” and said investors “should expect relentless price cuts to continue.”
Base prices for Tesla’s Model S and Model X have fallen by around $5,000, MarketWatch has noted, as the electric-vehicle maker tries to stimulate demand. The company is also selling a more affordable Model Y SUV.
“Tesla concerns on pricing and a race to the bottom persisted as general sentiment on the stock is souring given recent price cuts after a brief period of stabilization,” TD Cowen analyst Jeffrey Osborne said in a note.
Tesla will report as the Biden administration tries to take a harder stance on auto pollution. The EPA recently proposed new emissions restrictions intended to hasten electric-vehicle usage, by incrementally curtailing tailpipe emissions each year for vehicle model years 2027 through 2032. However, some analysts said the measures would push prices higher for regular and electric vehicles.
The first-quarter earnings reporting season will pick up steam in the week ahead, with 60 S&P 500 companies, including six from the Dow Jones Industrial Average
DJIA,
reporting quarterly results, according to FactSet. Those companies will report as Wall Street analysts remain pessimistic about results for the quarter, and the prospect of another so-called “earnings recession” in which profits contract for at least two straight quarters.
“As of today, the S&P 500 is reporting a year-over-year decline in earnings of -6.5% for the first quarter, which would mark the largest earnings decline reported by the index since Q2 2020 (-31.6%) and the second straight quarter the index has reported a decline in earnings,” FactSet Senior Earnings Analyst John Butters said in a report on Friday.
After investors cheered JPMorgan Chase & Co.’s
JPM,
quarterly results on Friday — despite Silicon Valley Bank’s collapse and broader recession anxieties — other banking giants, like Bank of America Corp.
BAC,
Goldman Sachs Group Inc.
GS,
and Morgan Stanley
MS,
report during the week ahead. So does Johnson & Johnson
JNJ,
after it agreed to pay as much as $8.9 billion to settle scores of lawsuits alleging that its talc baby powder was linked to cancer. Charles Schwab Corp.
SCHW,
United Airlines Holdings Inc.
UAL,
and AT&T Inc.
T,
also report during the week.
Supply-chain update, anyone? Shipping rates have fallen. Labor tensions have risen. Railroad safety is under scrutiny. Elsewhere in that industry, hedge funders are applying pressure. Memories of 2021’s supply-chain meltdown are still fresh after it led to shipping delays and put the low-work labor that fuels much of that distribution network under a spotlight.
At any rate, trucking and logistics company J.B. Hunt Transportation Services Inc.
JBHT,
reports on Monday, while railroad giant CSX Corp.
CSX,
reports on Thursday. Both companies report after a drop-off in demand for goods last year, as inflation remolded consumers’ buying habits. They also report after rail workers threatened to strike over what they said were inadequate sick-time policies. More recently, a group representing the terminal operators at the ports of Los Angeles and Long Beach alleged that dockworkers were disrupting daily operations at the two massive import gateways, as the workers’ union and the terminal operators try to work out a contract. The quarterly financial reports and earnings calls will offer a look at what the year ahead has in store.
Credit-card transactions, charge-offs: Credit-card providers Discover Financial Services
DFS,
and American Express Co.
AXP,
report Wednesday and Thursday, respectively. The companies will report after Discover took a hit in January after it forecast credit-card net charge-offs — a measure of debt a company doesn’t think it’ll get back — that were worse than what Wall Street expected. Similar to the results from the big banks, the results from American Express and Discover will tells us how much consumers are still spending, and whether more are falling behind on their bills, as recession anxieties prevail.
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It feels as if every day brings new price changes from
Tesla
Investors are getting used to them. The bigger deal now is the electric-vehicle company’s first-quarter gross profit margins are due to be reported in just a few days.
Reuters reported Friday that Tesla cut prices for its electric vehicles in Europe and some other countries. The price of a Model 3 and Y in Germany were reduced about 5% and 10%, respectively.
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There is currently no dispute over who wears the crown of world’s wealthiest person. It isn’t Tesla Chief Executive Elon Musk.
The net worth of Bernard Arnault, the founder and chairman and chief executive officer of LVMH Moet-Hennessy Louis Vuitton SE
MC,
stood at $210 billion as of Thursday, according to the Bloomberg Billionaire Index. That makes him the world’s richest person by that marker, with an increasingly comfortable lead over Tesla’s
TSLA,
Musk, who also leads SpaceX and Twitter and whose wealth stands at $180 billion. At times the two have been in a neck-and-neck race for that top spot.
LVMH shares closed at a record €883 on Thursday, helping lift the French CAC-40
PX1,
to an all-time high. That followed forecast-beating first-quarter sales from the luxury giant, thanks to returning China shoppers as COVID-19 restrictions eased, and rebounding international travel that drove duty-free sales. Up 7% so far this week, LVMH shares rose another 0.5% on Friday to €888.70.
The stock surge padded Arnault’s fortune by $11.6 billion on Thursday, the second-biggest single-day gain ever for him and a fresh record fortune, according to Bloomberg. Musk didn’t do badly.
He increased his wealth by $3.83 billion on Thursday, before Tesla and U.S. equities
SPX,
generally retreated a bit on Friday.
Read: Who is Bernard Arnault, the world’s richest person after surpassing Elon Musk?
LVMH owns jewelers Bulgari and Tiffany, alongside fashion houses Louis Vuitton and Dior. Results released late Wednesday showed the luxury standard-bearer beating expectations across every division, led by fashion and leather goods, the latter of which is significant, Berenberg analysts observed.
“As the most profitable division, this also bodes well for margin development,” said Berenberg analyst Graham Renwick, in a note to clients on Friday.
“This performance sets the standard for [first quarter] luxury reporting and gives encouragement on China’s recovery from pandemic disruption. Overall, we think these results continue to demonstrate LVMH’s strong momentum and best-in-class execution — again reaffirming its high quality and strong track record, which we believe investors are favoring in this uncertain macro environment,” said Renwick, who reiterated a buy rating on LVMH’s stock and lifted his share-price target to €960.
The luxury sector got another confidence boost on Friday, as Hermès International SCA
RMS,
revealed sales momentum in the first quarter, driven by a bump in tourism and new stores. The maker of the legendary Birkin handbag saw a 23% annual increase in first-quarter sales and backed “ambitious” organic revenue-growth targets.
Luxury stocks have seen an impressive rebound in 2023, after a weak 2022 — LVMH shares fell 6% in 2022 as travel restrictions in China and overall economic worries weighed on shoppers.
LVMH shares are up 30% so far in 2023, with Hermès up 36% and Christian Dior SE
CDI,
and Gucci owner Kering SA
KER,
up 26% and 21%, respectively.
As for Musk, his wealth is divided among his businesses. While Tesla accounts for $76 billion, Bloomberg estimates his share of SpaceX is worth $49 billion, and his share of Tesla is worth nearly $10 billion. He paid $44 billion for Twitter last year, after an attempt to wriggle out of the deal, and its current valuation is a matter of much speculation. Musk has fired thousands of employees and claimed this week that a return to profitability is now just around the corner.
Tesla is slated to report quarterly results next week, and some analysts aren’t optimistic due to persistent price cuts of its models.
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CNN
—
The Environmental Protection Agency on Wednesday proposed ambitious new car pollution rules that could require electric vehicles to account for up to two-thirds of new cars sold in the US by 2032, in what would be one of the Biden administration’s most aggressive climate-change policies yet.
The tailpipe standards would also have the effect of cutting planet-warming pollution from cars in half. Transportation accounts for nearly 30% of all greenhouse gas emissions in the US, according to the EPA.
EPA Administrator Michael Regan called the regulations “the strongest-ever federal pollution standards for cars and trucks.”
Regan touted the proposed rules on “CNN News Central” on Wednesday, claiming they would bring down costs for consumers and slash planet-warming pollution.
“This is a future for everyone, and we’re starting to see all of the auto industry move in this direction,” Regan told CNN’s Sara Sidner, saying strong auto emissions rules have been part of President Joe Biden’s “vision from day one.”
EPA officials said that they are considering several different emissions proposals, which could result in anywhere from a 64% to 69% electric vehicle adoption rate by early next decade. If approved, the emissions standards would start model year 2027 vehicles.
The agency anticipates the new rules would mean EVs could also make up nearly half of all new medium-duty vehicles, like delivery trucks, by model year 2032. Officials are also proposing stronger standards for heavy-duty vehicles, including dump trucks, public utility trucks, and transit and school buses.
One expert told CNN the Biden administration’s proposal is a pivotal moment for the US auto industry and consumers.
“It’s a pretty big deal,” said Thomas Boylan, a former Environmental Protection Agency official and the regulatory director for the EV trade group Zero Emission Transportation Association. “This is really going to set the tone for the rest of the decade and into the 2030s in terms of what this administration is looking for the auto industry to do when it comes to decarbonizing and ultimately electrifying.”
Regan and White House National Climate Adviser Ali Zaidi hailed the proposed regulations as a major climate win that would also save American consumers money in the coming years.
Zaidi said that in the Biden administration’s first few years, the number of EVs on US roads had already tripled, while the number of public charging stations had doubled. And Zaidi vowed more to come, with funding from Biden’s infrastructure law for a network of EV charging stations combined with consumer tax credits.
“Whether you measure today’s announcements by the dollars saved, the gallons reduced, or the pollution that will no longer be pumped into the air, this is a win for the American people,” Zaidi said.
Yet even as the administration is writing aggressive regulations to push the market toward EVs, a Gallup poll released Wednesday suggests that Americans are not yet sold on the idea. Gallup polled more than 1,000 adults in the US last month and found that 41% said they would not buy an electric vehicle.
Not only are EVs still more expensive than gas-powered cars, but consumers also haven’t yet grasped the climate benefits of transitioning to zero-emissions vehicles, the poll found. Six in 10 respondents said they believe EVs help the environment “only a little” or “not at all,” Gallup reported.
Transportation is the biggest source of planet-warming pollution in the US, and light duty vehicles – the average cars Americans drive – account for 58% of those emissions. The UN’s Intergovernmental Panel on Climate Change reported last year that aggressive, pollution-slashing changes in the global transportation sector – including the transition to EVs – could reduce the sector’s emissions by more than 80%.
Speaking on CNN, Regan also emphasized that switching to an EV would save consumers money in the long run.
“Folks who purchase electric vehicles will see a cost savings over the lifespan of the vehicle, because they’re not having to buy gas, having to pay for maintenance,” Regan said. “So this is a huge opportunity for everyone in this country.”
Other countries, including the EU and China, are moving faster toward adopting EVs. In the US, California has already proposed that zero-emissions vehicles make up 70% of new car sales by 2030, and 17 other states plan to follow California’s lead.
That means much of the US car industry will already be transitioning ahead of the proposed federal rules.
“I believe it’s pretty doable,” Margo Oge, chair of the International Council on Clean Transportation and a former Obama EPA official, said of the aggressive transition to EVs. “The industry is there. Europe is ahead of the US, China is ahead of Europe – and these companies are global companies.”
New federal tax credits are coming next week that aim to help American consumers save up to $7,500 on an EV. But they have incredibly complex requirements for the auto industry – including that the cars’ batteries and components come from the US or countries it has a free-trade agreement with.
Still, Boylan said the regulations are designed to gradually work over the next decade, by which time consumers should have far more electric vehicle options to choose from.
“You’ve got the tax credits as the carrot,” Boylan said. The proposed tailpipe regulation “provides the stick to backstop these incentives and push the industry forward.”
Regan told CNN the rules would be phased in gradually, giving auto makers and consumers years before they fully go into effect. During that time, the administration is focused on installing more EV charging stations and expanding access to $7,500 federal EV tax credits.
“What we’re looking at is a ramp-up period,” Regan said on CNN. “We’re going to see a massive buildup over the next couple years, and we’re starting to see those electric vehicle sales numbers grow already.”
The EPA will take public comment on the proposal before finalizing the rules in the coming months.
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Tesla
is at it again.
The electric-vehicle maker lowered prices for its EVs in the U.S. again. This change hints at what might be happening to Tesla (ticker: TSLA) vehicles’ eligibility for purchase tax credits under stricter rules about to be applied by the IRS.
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After the start to the year
Tesla
shares have had, first-quarter deliveries better beat Wall Street expectations.
Shares of Tesla (ticker: TSLA) finished the first quarter up more than 68%—the best first-quarter performance ever. In second place: 2012’s first quarter, when shares gained 30.4%. This year’s first quarter is the sixth best quarter for shares ever. The stock has been trading for 51 quarters.
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CNN
—
A train hauling ethanol derailed Thursday morning in Raymond, Minnesota, igniting several rail cars and forcing a mandatory evacuation of the city of about 800, officials said.
The fire was still burning more than 8 hours after the derailment, the US Environmental Protection Agency said in a statement late Thursday morning.
“Four cars containing ethanol, a highly flammable product, ruptured, caught fire and continue to burn,” said the EPA, which had members at the scene by 6:30 a.m.
And there’s a risk that more ethanol could spill.
“Four additional cars containing ethanol may also release,” the EPA said. “The local fire department is currently the lead for the response and ordered a mandatory evacuation of the city. The evacuation remains in place.”
The EPA team is on the ground in Raymond to conduct air quality monitoring.
Preliminary information suggests 14 of the train’s 40 cars were carrying hazardous material, “including ethanol, which was released – leading to a fire,” US Transportation Secretary Pete Buttigieg told CNN on Thursday.
In addition to ethanol, the train was carrying mixed freight including corn syrup, said Lena Kent, general director of public affairs for BNSF Railway.
Ethanol can explode when mixed with vapor and air. Ethanol exposure can lead to coughing, dizziness, the feeling of burning eyes, drowsiness and unconsciousness.
The derailment happened around 1 a.m. Homes within a half-mile of the derailment were evacuated, the Kandiyohi County Sheriff’s Office said.
“There have been no injuries as a result of the crash or emergency response,” the sheriff’s office posted on Facebook. “BNSF specialists are on scene and continued mitigation is occurring.”
Brittney Phelps and her family were startled by a knock on their door at 1:30 a.m. It was a first responder going door to door telling residents to flee as a precaution.
“I heard a loud crash but didn’t think anything of it ‘til ambulances were outside the house,” Phelps said.
She soon smelled the stench of ethanol and saw the wrecked train cars and large fire, Phelps told CNN.
The Minnesota Department of Transportation closed a nearby highway due to the derailment and blaze, the fire department said. The main railroad track is blocked, and an estimated time for reopening the line was not available.
“The City of Raymond is not accessible to the public, so Unity Church in Prinsburg is willing to be a drop off location for bottled water and snacks for the firemen,” the wife of a fire department member said, according to the department’s Facebook page. “These brave souls have been working hard for hours already, and have several hours of work ahead for them.”
The cause of the derailment is under investigation. A team from the National Transportation Safety Board is expected to arrive at the site Thursday afternoon, the NTSB said.
Minnesota Gov. Tim Walz and state emergency management leadership will travel to Raymond on Thursday to visit the site of the derailment, the governor’s office said.
The derailment happened nearly two months after another train carrying hazardous chemicals derailed in East Palestine, Ohio – igniting a dayslong inferno, spewing poisonous fumes into the air and killing thousands of fish. The Ohio health department is preparing to offer health tests to first responders as part of a long-term effort to monitor the health of those who responded to the disaster.
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This copy is for your personal, non-commercial use only. To order presentation-ready copies for distribution to your colleagues, clients or customers visit http://www.djreprints.com.
https://www.barrons.com/articles/stock-market-movers-96dc510b
Stock futures rose Friday as the biggest banks in the U.S. moved to rescue beleaguered First Republic Bank.
These stocks were poised to make moves Friday:
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Rivian Automotive shares are basically free, the latest evidence, if any was needed, that the stock market is hard to figure out.
Shares of the electric- truck start-up (ticker: RIVN) fell for a fourth consecutive day on Tuesday. First there was the banking crisis, which hit most stocks last week. Then the market learned Monday that Rivian might end its exclusivity pact with
Amazon.com
(AMZN), freeing up the auto maker to sell electric vans to other customers.
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Shares of
Rivian Automotive
fell after a report said the electric truck start-up is in talks to end an exclusivity pact with Amazon.com. That might have been an overreaction, judging by Amazon’s response to the news.
The Wall Street Journal reported Monday that Rivian (ticker: RIVN) is seeking to remove an exclusivity term in its agreement with Amazon (AMZN) after the e-commerce retailer ordered about 10,000 electric delivery vans for this year, which was on the lower end of Amazon’s range.
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Rivian Automotive Inc.’s stock fell more than 3% Monday after news that the electric-vehicle maker and Amazon.com Inc. are discussing possible changes to their deal for electric delivery vans.
Citing people familiar with the matter, the Wall Street Journal reported Monday that the companies are in talks to end the exclusivity part of their electric-van deal. The talks started after Amazon’s order for the year was at the low end of the previous range, the report said.
A…
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CNN
—
Lithium-ion batteries, found in many popular consumer products, are under scrutiny again following a massive fire this week in New York City thought to be caused by the battery that powered an electric scooter.
At least seven people have been injured in a five-alarm fire in the Bronx which required the attention of 200 firefighters. Officials believe the incident stemmed from a lithium-ion battery of a scooter found on the roof of an apartment building. In 2022, the the New York City Fire Department responded to more than 200 e-scooter and e-bike fires, which resulted in six fatalities.
“In all of these fires, these lithium-ion fires, it is not a slow burn; there’s not a small amount of fire, it literally explodes,” FDNY Commissioner Laura Kavanagh told reporters. “It’s a tremendous volume of fire as soon as it happens, and it’s very difficult to extinguish and so it’s particularly dangerous.”
A residential fire earlier this week in Carlsbad, California, was suspected to be caused by an e-scooter lithium battery. On Tuesday, an alarming video surfaced of a Canadian homeowner running downstairs to find his electric bike battery exploding into flames. A fire at a multi-family home in Massachusetts last month is also under investigation for similar issues.
These incidents are becoming more common for a number of reasons. For starters, lithium-ion batteries are now in numerous consumer tech products, powering laptops, cameras, smartphones and more. They allow companies to squeeze hours of battery life into increasingly slim devices. But a combination of manufacturer issues, misuse and aging batteries can heighten the risk from the batteries, which use flammable materials.
“Lithium batteries are generally safe and unlikely to fail, but only so long as there are no defects and the batteries are not damaged or mistreated,” said Steve Kerber, vice president and executive director of Underwriters Laboratory’s (UL) Fire Safety Research Institute (FSRI). “The more batteries that surround us the more incidents we will see.”
In 2016, Samsung issued a global recall of the Galaxy Note 7 in 2016, citing “battery cell issues” that caused the device to catch fire and at times explode. HP and Sony later recalled lithium computer batteries for fire hazards, and about 500,000 hoverboards were recalled due to a risk of “catching fire and/or exploding,” according to the U.S. Consumer Product Safety Commission.
In 2020, the Federal Aviation Administration banned uninstalled lithium-ion metal batteries from being checked in luggage and said they must remain with a passenger in their carry-on baggage, if approved by the airline and between 101-160 watt hours. “Smoke and fire incidents involving lithium batteries can be mitigated by the cabin crew and passengers inside the aircraft cabin,” the FAA said.
Despite the concerns, lithium-ion batteries continue to be prevalent in many of today’s most popular gadgets. Some tech companies point to their abilities to charge faster, last longer and pack more power into a lighter package.
But not all lithium batteries are the same.
Dylan Khoo, an analyst at tech intelligence firm ABI Research, said electric bikes and scooters use batteries which can be around 50 times larger than the one in a smartphone. “So when a fire does happen, it’s much more dangerous,” Khoo said.
All lithium-ion batteries use flammable materials, and incidents such as the one in the Bronx are likely the result of “thermal runaway,” a chain reaction which can lead to a fire or catastrophic explosion, according to Khoo.
“This process can be triggered by a battery overheating, being punctured, or an electrical fault like a short circuit,” Khoo said. “In cases where fires occur spontaneously while charging, it is likely due to manufacturing defects.”
According to Kerber, the number of lithium-ion battery-based fires is growing with enormous frequency both in the United States and internationally, particularly when it comes to e-bikes and e-scooters, due to an uptick in purchases of these products during the pandemic.
“After Covid started, scooter use went dramatically up, especially in places like New York City, for deliveries,” Kerber said. “People started to get overcharged for them and turned to manufacturers which happened to have lower quality control with the battery systems. The quality manufacturers are not having issues.”
“It will continue to happen until there are regulations around the quality of these devices,” Kerber said.
Kerber recommends people buy UL-certified electric bikes and scooters from reputable retailers; online marketplaces often make it hard for customers to tell where products are actually coming from. If a fire occurs, he advised people to evacuate and call 911 immediately rather than trying to put it out themselves.
“The fire spreads incredibly fast and a fire extinguisher is not effective,” he said.
Beyond scooters and e-bikes, experts warn anyone with a lithium-ion battery should follow proper charging and battery usage guidelines. According to researchers at the University of Michigan, any device with this kind of battery should be charged and stored in a cool, dry place, and not left charging for too long or while you’re asleep – a recommendation likely at odds with how many consumers handle their devices.
“Elevated temperatures can accelerate degradation of almost every battery component and can lead to significant safety risks, including fire or explosion,” the researchers said. “If a laptop or cellphone is noticeably hot while it’s charging, unplug it. Minimize exposure to low temperatures, especially when charging.”
Batteries should also be routinely inspected to make sure there is no cracking, bulging or leaking, and people should always use the charger that came with the device or use one from a reputable supplier. When charging an electric scooter or bike, Kerber said it should never block a fire escape or exit route.
Although some battery chemistries are safer than others, we are still a few years away from adoption of a better, safer lithium-ion alternative, according to Sridhar Srinivasan, a senior director at market research firm Gartner.
For example, LFP (lithium iron phosphate) batteries don’t overheat as much as other types of lithium-ion batteries. Future battery technologies in development, such as sodium-ion or solid state batteries, are also expected to address some of the safety issues of lithium ion.
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