Company news in brief

WeWork IPO still on despite setbacks

WeWork owner The We Company said on Monday it expected to complete its initial public offering (IPO) by the end of the year, after walking away from preparations earlier in the day to proceed with it stock market debut this month.

The US office-sharing startup was getting ready to launch an investor road show for its IPO this week before making a last-minute decision on Monday to stand down, because of concerns not enough stock market investors would participate, people familiar with the matter said.

The company has been under pressure to proceed with the stock market flotation to secure funding for its operations.

In the run-up to the launch of its IPO, We Company has faced concerns about its corporate governance standards, as well as the sustainability of its business model, which relies on a mix of long-term liabilities and short-term revenue, and how such a model would weather an economic downturn.

Reuters reported last week that We Company might seek a valuation in its IPO of between US$10 billion and US$12 billion, a dramatic discount to the US$47 billion valuation it achieved in January. – Nampa/Reuters

Boeing raises forecast for Chinese demand

Boeing Co yesterday raised its forecast for China's aircraft demand for the next 20 years, underpinned by expectations of robust air travel demand, but growth in new fleet will be slower than the planemaker's prediction last year.

Chinese carriers will need 8 090 new planes through 2038, 5.2% higher than Boeing's forecast last year. That would be worth nearly US$1.3 trillion based on list prices.

Last year, Boeing forecast a 6.2% growth in the country's new aircraft demand to 7 690 planes for the period to 2037.

"An expanding middle class, significant investment in infrastructure, and advanced technologies that make airplanes more capable and efficient, continue to drive tremendous demand for air travel," said Randy Tinseth, vice president of commercial marketing for Boeing.

Boeing and its European rival, Airbus, have been jostling to increase market share in China, the world's fastest growing aviation market, with both opening assembly plants in the country. – Nampa/Reuters

Almost 50 000 GM workers on strike

Almost 50,000 US auto workers went on strike on Monday in a pay dispute with General Motors, the largest industrial action to hit the carmaker in more than a decade.

Workers from 31 plants opted to walk out after talks between the company and the United Auto Workers Union (UAW) hit an impasse as they tried to negotiate a replacement agreement when the manufacturer's four-year contract with workers expired.

How long the labour action might last was uncertain.

Car production at the Detroit giant, which was saved by a multi-billion dollar bailout from the Obama administration after the 2008 economic crash, was brought to a complete standstill on Monday, Rothenberg said.

On Wall Street, GM shares fell 4.3%. CNBC said the strike could cost the automaker US$90 million a day. – Nampa/AFP

Airbus sees no major impact from tariffs

Possible US tariffs against Airbus aircraft and European parts are unlikely to have a major impact on the European planemaker's 2019 results, but disruption cannot be ruled out, its chief executive said.

In an interview with Politico, released by German stablemate Die Welt on Monday, CEO Guillaume Faury the main risk was that airlines would refuse to buy Airbus jets because of the risk that repeat purchases would be rendered uneconomic by future tariffs.

The World Trade Organisation has at least partially approved a US request to impose tariffs on European Union aircraft and other goods as part of a 15-year trade dispute in which the EU is also preparing similar action against the US.

Analysts say airlines tend to renew their fleets only every 15 years or so, meaning long-term risks must factored in whenever they are making purchase decisions.

Turning to the impact of Britain's departure from the European Union, Faury said that while it would be impossible to move ongoing production of aircraft wings from Britain, Brexit could have an impact on future investment decisions. – Nampa/Reuters

Sainsbury's outperforms rivals

Sainsbury's was the best performing of Britain's big four supermarket groups in the latest 12 week period, indicating its tentative recovery was gaining momentum after a prolonged period of underperformance, industry data showed yesterday.

Market researcher Kantar said Sainsbury's sales fell 0.1% in the 12 weeks to 8 September. That compared with falls of 1.4%, 1% and 2% at market leader Tesco, Asda and Morrisons respectively.

However, all of the big four still lost market share to German owned discounters Aldi and Lidl.

Kantar said total UK grocery sales rose 0.5% over the 12 weeks, while grocery inflation was 1.0%. – Nampa/Reuters