Team Play­ers

Bloomberg Businessweek (North America) - - Companies / Industries -

work will re­sult in less pass­ing, quicker brak­ing, and fuel sav­ings of about 10 per­cent for the fol­low­ing trucks and a smaller gain for the lead ve­hi­cle, ac­cord­ing to Daim­ler. And it will help re­duce con­ges­tion. When a hu­man is at the wheel, a truck in some coun­tries must main­tain a dis­tance of about half a foot­ball field from the ve­hi­cle in front of it to stop safely in an emer­gency. With au­toma­tion, that dis­tance shrinks to about 50 feet. “Traf­fic on the whole will be­come calmer,” says An­dreas Ren­schler, who heads the Sca­nia and MAN truck brands for Volk­swa­gen.

Man­u­fac­tur­ers ex­pect pla­toon­ing to start tak­ing off in 2020. Most trucks made in the past decade have sen­sors that alert driv­ers when they wan­der out of a lane or get too close to the ve­hi­cle ahead of them, re­ly­ing on cam­eras and radar sim­i­lar to those found in high-end Mercedes-benz and BMW sedans. Adding au­to­mated steer­ing and brak­ing wouldn’t be com­pli­cated, ve­hi­cle mak­ers say. Lori Tavasszy, a lo­gis­tics pro­fes­sor at Delft Univer­sity of Tech­nol­ogy in the Nether­lands, says half the Euro­pean fleet of big rigs— 750,000 trucks—could be pla­toon-ready by 2025. “The tech­nol­ogy for this is there,” says Erik Jon­naert, sec­re­tary gen­eral of the Euro­pean Au­to­mo­bile Man­u­fac­tur­ers’ As­so­ci­a­tion. “The bot­tle­neck is reg­u­la­tion and how it can be de­ployed com­mer­cially so freight com­pa­nies pick it up.”

In Brus­sels, law­mak­ers are con­sid­er­ing Europewide reg­u­la­tions for things such as the min­i­mum le­gal dis­tance be­tween ve­hi­cles—164 feet in Ger­many, but sim­ply “a safe dis­tance” in the Nether­lands—and adopt­ing stan­dard rules about dis­solv­ing pla­toons at busy high­way junc­tions. On April 14 trans­port min­is­ters, the Euro­pean Com­mis­sion, and in­dus­try rep­re­sen­ta­tives agreed to co­op­er­ate on con­nected and au­to­mated driv­ing, fo­cus­ing on traf­fic rules and mak­ing test­ing eas­ier. Close co­op­er­a­tion “is needed if we want a wide-scale in­tro­duc­tion of pla­toon­ing,” says Har­rie Schip­pers, who heads DAF Trucks, the Euro­pean unit of Pac­car, a man­u­fac­turer based near Seat­tle.

In April’s dry run, six con­voys of two or three trucks each—in­clud­ing Kropp’s—trav­eled to Rot­ter­dam from Swe­den, Ger­many, and Bel­gium. Three Sca­nia trucks cov­ered the long­est dis­tance, start­ing near Stock­holm, cross­ing the 10-mile Ore­sund Bridge and tun­nel to Den­mark, head­ing south to Ger­many and then into the Nether­lands. Each car­a­van in the test com­pleted the jour­ney as a unit, but man­u­fac­tur­ers en­vi­sion con­voys form­ing on an ad hoc ba­sis, with driv­ers fol­low­ing a leader for any­where from a few ex­its to hun­dreds of miles as in­di­vid­ual ve­hi­cles pull off to make de­liv­er­ies or take al­ter­nate routes to their fi­nal des­ti­na­tions. Daim­ler says cars seek­ing to leave the high­way can ef­fec­tively nudge their way into a con­voy: The truck be­hind rec­og­nizes the in­ter­loper and in­creases its dis­tance ac­cord­ingly, then closes the gap once the car ex­its. If a ve­hi­cle pulls out in front of the first truck, the lead driver hits the brakes and the fol­low­ers be­gin to slow al­most im­me­di­ately.

Even though the ini­tia­tive started in Europe, the man­u­fac­tur­ers say pla­toon­ing may be even more rel­e­vant in places with wide-open roads such as Aus­tralia or the western U.S., where dis­tances trav­eled are greater. “The event in Rot­ter­dam re­ally broke the ice,” says Odile Ar­beit de Chal­en­dar, an of­fi­cial of the Con­fer­ence of Euro­pean Di­rec­tors of Roads, who helped set up the April test. “For the first time, we put pla­toons on the road, in real traf­fic, across borders, and long dis­tance.” �Elis­a­beth Behrmann

The bot­tom line Man­u­fac­tur­ers say the tech­nol­ogy for con­voys of semi­au­tonomous trucks can lead the way to driver­less ve­hi­cles.

sports-per­for­mance brand—with en­ergy drinks, Ron­aldo-branded sup­ple­ments, and a leaf-shaped logo he hopes will be­come as rec­og­niz­able as Nike’s swoosh. Her­bal­ife de­clined to com­ment for this story.

The sports push, which has in­cluded soc­cer stars David Beck­ham and Lionel Messi as en­dorsers, has helped the com­pany ex­pand be­yond the U.S. into soc­cer-ob­sessed Latin Amer­ica and Europe, de­spite a whirl­wind of bad press about its busi­ness model. “If you see Her­bal­ife on David Beck­ham’s shirt, that makes you be­lieve it is some­thing cred­i­ble and le­git­i­mate—some­thing you can trust,” says An­drew Hol­land, en­gage­ment man­ager for brand strat­egy con­sul­tant Vi­valdi Part­ners Group.

Hedge fund man­ager Bill Ack­man has spent three years and more than $50 mil­lion try­ing to con­vince in­vestors that the com­pany is an il­le­gal pyra­mid scheme. Ack­man’s cam­paign, which he be­gan af­ter bet­ting $1 bil­lion against Her­bal­ife’s stock, has been beaten back by not only the com­pany’s vig­or­ous de­nials of the al­le­ga­tions but also the cred­i­bil­ity of its brand am­bas­sadors. Her­bal­ife has en­dorse­ment deals with 40 teams and 80 ath­letes, and its pop­u­lar­ity has helped it keep re­cruit­ing peo­ple to re­sell its teas and vi­ta­mins. It’s added 800,000 so-called dis­trib­u­tors since Ack­man be­gan mak­ing his al­le­ga­tions in De­cem­ber 2012, lift­ing the to­tal to 4 mil­lion at the end of 2015.

Ron­aldo, with more than 100 mil­lion fol­low­ers on so­cial me­dia, is a po­tent weapon. Be­fore Ron­aldo, Her­bal­ife fea­tured Messi, ar­guably the big­gest star of the world’s most pop­u­lar sport, and for five years had its name em­bla­zoned on Beck­ham’s Los An­ge­les Galaxy jer­sey.

To­day Her­bal­ife’s en­dorse­ment deals in­clude an In­dian crick­eter and a Malaysian squash player. There’s an Is­raeli women’s bas­ket­ball team bear­ing its name—her­bal­ife Ra­mat Hasharon—an off-road rac­ing squad from Peru, and hand­ball play­ers in France. All this mar­ket­ing comes at the rel­a­tively skimpy cost of only about 1.5 per­cent of its $4.47 bil­lion in sales last year. Consumer gi­ants Nike and Proc­ter & Gam­ble ded­i­cate about 10 per­cent of rev­enue to mar­ket­ing.

Ack­man has com­plained that Her­bal­ife’s suc­cess can be at­trib­uted to con­sumers see­ing it as a le­git­i­mate en­ter­prise be­cause of its re­la­tion­ship with Ron­aldo, Messi, and other pub­lic fig­ures it’s em­ployed, in­clud­ing for­mer Sec­re­tary of State Madeleine Al­bright and An­to­nio Vil­laraigosa, for­mer mayor of Los An­ge­les. “The best pyra­mid schemes try to re­cruit cred­i­ble peo­ple to give them cred­i­bil­ity,” Ack­man said dur­ing a 2014 pre­sen­ta­tion in which he claimed Her­bal­ife nu­tri­tion clubs run by dis­trib­u­tors were a ruse to bleed money from poor con­sumers. Her­bal­ife has de­fended the clubs.

Yet Her­bal­ife’s en­dorse­ments mimic what brands have been do­ing for decades to con­nect with con­sumers. It’s tar­get­ing peo­ple in more than 90 na­tions, with a fo­cus on Latin Amer­ica. Other soc­cer deals in­clude top clubs Barcelona, Mex­ico’s Pu­mas, and Brazil’s San­tos FC (for­mer team of the leg­endary Pelé). Spokes­men for Ron­aldo, Messi, Vil­laraigosa, and the LA Galaxy didn’t re­spond to re­quests for com­ment. A rep­re­sen­ta­tive for Al­bright’s con­sult­ing firm, Al­bright Stone­bridge Group, de­clined to com­ment.

Dur­ing Beck­ham’s 2007-12 Galaxy ten­ure, Her­bal­ife’s sales dou­bled. Its dis­trib­u­tor ranks also rose to 3.2 mil­lion from 1.5 mil­lion, with huge gains com­ing from soc­cer-lov­ing na­tions. Ex­plained John­son in a 2007 in­vestor call: “Adi­das pro­duced more than 600,000 Galaxy jer­seys in its ini­tial run, and ev­ery­one in ev­ery one of those is a mo­bile Her­bal­ife bill­board.” Ap­par­ently Ack­man wasn’t lis­ten­ing in. �Matt Townsend

July 2007 Beck­ham’s LA Galaxy de­but in an Her­bal­ife-branded jer­sey June 2010 Her­bal­ife signs deals with Messi and his club, FC Barcelona De­cem­ber 2012 Ack­man launches cam­paign against Her­bal­ife June 2013 The com­pany signs Ron­aldo to a five-year deal The bot­tom line Her­bal­ife’s ties to soc­cer stars have al­lowed it to ex­pand be­yond the U.S. de­spite crit­i­cism of its busi­ness model.

treat­ment in­volves 20 to 30 tiny in­jec­tions by a doc­tor, who must avoid the nerves and ma­jor blood ves­sels run­ning un­der the jaw­line. Each ses­sion costs about $1,500, and most pa­tients re­quire two to four, says Dr. Anne Cha­pas, a der­ma­tol­o­gist in New York. Her prac­tice, Union Square Laser Der­ma­tol­ogy, now per­forms about two Ky­bella treat­ments a week and ex­pects to do more with the mar­ket­ing push. “We were ab­so­lutely ex­cited about it,” she says. “We know there’s huge po­ten­tial.”

Ky­bella bol­sters Al­ler­gan’s po­si­tion in aes­thetic treat­ments, an area San­ford C. Bern­stein an­a­lysts fore­cast to grow 10 per­cent a year through 2020. Be­sides wrin­kle-end­ing Bo­tox, with $2 bil­lion in 2015 sales, Al­ler­gan also sells der­mal fillers like Voluma for dra­matic cheek­bones. Schai­son al­ready has a name for its nee­dle-based trio of Bo­tox, der­mal fillers, and Ky­bella: the liq­uid face-lift. “Now we’re al­most a one-stop shop,” he says. “We own the face.”

Schai­son isn’t just on top of the busi­ness push­ing no-cut facelifts; he’s also a client who got his Ky­bella treat­ment last June. “I was not both­ered by my chin, but I wanted to ex­pe­ri­ence it,” he says of the 10-minute pro­ce­dure. “I ab­so­lutely loved the re­sults.”

Ky­bella faces few ri­vals. The most pop­u­lar al­ter­na­tive in the U.S., li­po­suc­tion, can cost more than $6,000 and re­quires an in­ci­sion, a few days in ban­dages, and oc­ca­sional scar­ring. Un­like Bo­tox, the ef­fect of Ky­bella doesn’t wear off in a few months. That means the rev­enue stream is short, but the drug may have a broader ap­peal than many plas­tic surgery or der­ma­to­logic treat­ments. Al­ler­gan says Ky­bella in tri­als was ef­fec­tive for 80 per­cent of pa­tients.

El­iz­a­beth Kru­to­holow, a drug an­a­lyst at Bloomberg In­tel­li­gence, says Ky­bella could log $500 mil­lion in an­nual sales. Al­ler­gan says men could ac­count for 30 per­cent of pa­tients vs. 10 per­cent of Bo­tox users. That fig­ure may go higher if the com­pany is suc­cess­ful in tests of the drug against an­other en­dur­ing beauty scourge: love han­dles. �Kyle Stock

Edited by James E. El­lis and Dim­i­tra Kessenides Bloomberg.com Num­ber of very small cars sold in Ja­pan for which Mit­subishi Mo­tors ex­ag­ger­ated fuel-ef­fi­ciency fig­ures. The car­maker is now in­ves­ti­gat­ing its mileage claims on cars sold in in­ter­na­tional mar­kets. The bot­tom line Al­ler­gan’s Ky­bella drug to treat dou­ble chins could even­tu­ally bring in more than $500 mil­lion an­nu­ally.

The prin­ci­pal value of the Re­tire­ment Funds is not guar­an­teed at any time, in­clud­ing at or af­ter the tar­get date, which is the ap­prox­i­mate year an in­vestor plans to re­tire (as­sumed to be age 65) and likely stop mak­ing new in­vest­ments in the fund. If an in­vestor plans to re­tire sig­nif­i­cantly ear­lier or later than age 65, the funds may not be an ap­pro­pri­ate in­vest­ment even if the in­vestor is re­tir­ing on or near the tar­get date. The funds’ al­lo­ca­tions among a broad range of un­der­ly­ing T. Rowe Price stock and bond funds will change over time. The funds em­pha­size po­ten­tial cap­i­tal ap­pre­ci­a­tion dur­ing the early phases of re­tire­ment as­set ac­cu­mu­la­tion, bal­ance the need for ap­pre­ci­a­tion with the need for in­come as re­tire­ment ap­proaches, and fo­cus on sup­port­ing an in­come stream over a long- term postre­tire­ment with­drawal hori­zon. The funds are not de­signed for a lump- sum re­demp­tion at the tar­get date and do not guar­an­tee a par­tic­u­lar level of in­come. The funds main­tain a sub­stan­tial al­lo­ca­tion to eq­ui­ties both prior to and af­ter the tar­get date, which can re­sult in greater volatil­ity over shorter time hori­zons.

Newspapers in English

Newspapers from Canada

© PressReader. All rights reserved.