COMPANY NEWS IN BRIEF
07 October 2021 | Business
PepsiCo Inc said on Tuesday it would likely raise prices again early next year, as it looks to overcome ever increasing supply-chain challenges that include everything from a shortage of Gatorade bottles to a lack of truck drivers.
Chief Financial Officer Hugh Johnston told Reuters that PepsiCo had to "scramble" to overcome a shortage of cans and Gatorade bottles in the last few months as demand for its beverages jumped at restaurants and theatres following the lifting of pandemic-induced restrictions.
PepsiCo has already raised prices of its sodas and snacks in recent weeks, echoing the strategy of broader packaged foods industry as rising raw material prices pinch profit margins.
"I do expect there will probably be some price increases in the first quarter of next year as well, as we fully absorb and lock down the impact of commodity inflation," Johnston said, adding that he expects most supply-chain disruptions to moderate by the end of 2021.
PepsiCo's UK business has also been hit by a shortage of truck drivers in post-Brexit Britain due to immigration rules and a loss of about a year of driver testing and training. -Nampa/Reuters
Emirates slams Boeing over 777X delays
The head of Dubai airline Emirates piled pressure on plane maker Boeing on Tuesday over delays to its 777X jetliner, warning that the uncertainty would cause significant disruption for one of the world's biggest carriers.
Emirates President Tim Clark said he wanted "another grown-up conversation" with the U.S. plane maker over the timing of the twin-engine jumbo, which is running at least two and a half years behind its originally planned arrival of June 2020.
"We work to precision. I struggle with others who can't get that," Clark told reporters shortly before he was due to meet Boeing leaders on the side-lines of an airline industry summit.
Clark, an airline industry veteran who was closely involved in the development of the current 777-300ER model, has lambasted Boeing this year over repeated delays to its 777X.
The company has previously said it plans to start delivering the new, larger version of the 777 wide-body jet by late 2023, three years later than originally planned, partly owing to a longer certification process after fatal 737 MAX jet crashes. -Nampa/Reuters
GM to open battery cell centre
General Motors Co on Tuesday said it will open a battery cell development centre in southeast Michigan to help it drive down the cost and boost the driving range of electric vehicles with lithium ion and solid-state battery cells.
The Wallace Battery Cell Innovation Centre, to be located on the No. 1 US automaker's technical campus in Warren, Michigan, is expected to open in mid-2022 and begin building prototype cells in the fourth quarter, GM said.
"The key to making these vehicles affordable is going to be the cell cost in the battery packs," Ken Morris, GM's vice president of electric and self-driving vehicles, said on a conference call with reporters. GM will spend "hundreds of millions" of dollars on the new centre, he added.
Part of that push is GM's partnership with LG Energy Solutions, a unit of South Korea's LG Chem 051910.KS, to develop its Ultium batteries. The companies have announced two joint-ventures battery plants and GM has said it intends to open two more. -Nampa/Reuters
Swisscom loses appeal
Switzerland's Federal Administrative Court has rejected Swisscom's appeal over the standards it has to use in expanding fibre-optic networks to consumers, the court said on Tuesday.
The case centred on whether Swisscom could use a different standard than the one telecoms company had agreed in a round table with regulators, the court said in a statement.
The Swiss Competition Commission had provisionally prohibited Swisscom from pursuing its network expansion until the commission had concluded an investigation, a decision that Swisscom had appealed against in January.
"Swisscom was unable to credibly substantiate to the court that there were sufficient technological or economic grounds to deviate from the fibre-optic standard," it ruled in a verdict that may be appealed at the Swiss supreme court.
The telecom company said that it regrets the court decision and considers the precautionary measures to be misguided. -Nampa/Reuters
Daimler production below demand
Daimler Trucks CEO Martin Daum said the truck maker, set to spin-off from Daimler in December, will continue to sell fewer vehicles than it could have in the coming year as chip shortages hamper production.
"We will certainly be delivering less than we could have sold, and that also applies to next year," he said at a roundtable with journalists on Tuesday, echoing recent warnings from competitors like Traton that profits could fall in the second half due to supply chain issues.
While passenger vehicle producers such as BMW or Daimler can increase prices to offset chip losses, trackmakers do not have this flexibility, he said.
Still, the company has committed to a 15% fixed-cost reduction from 2019 levels by 2025, and cuts are "well underway", he said. A concrete update will be provided at the company's Capital Markets Day on Nov. 11.
Daimler Trucks & Buses, which prior to the pandemic reaped annual profits of around 2 billion euros (US$2.3 billion), is set to become the world's largest truck maker once the spin-off from Daimler approved by shareholders on Friday is complete. -Nampa/Reuters