AMERICA FIRST
The Canadian auto sector may dodge the worst of Donald Trump’s anti-NAFTA policies,
Trump, NAFTA and the auto sector Sergio Marchionne, for one, appears focused on his company’s Mexican operations rather than those in Canada as he speculates on the impact of Donald Trump’s strident criticisms of NAFTA.
That take on the U.S. presidentelect’s regard for the North American Free Trade Agreement by the Canadian-Italian CEO of Fiat Chrysler Automobiles N.V. aligns with a cautious consensus in the Canadian auto sector that it might escape serious injury from Trump’s “America First” policies.
Trump’s anti-NAFTA campaigning this year is “certainly a game changer,” says Marchionne, whose firm assembles 17 per cent of the vehicles it sells in North America at its Mexican plants. Trump has vowed to impose a 35- per-cent tariff on the vehicles of automakers that have shifted U.S. employment offshore, specifically targeting Fiat Chrysler, General Motors Co. and Ford Motor Co.
But how the game will change remains unclear. Far more U.S. jobs in the sector have been relocated to Mexico than Canada, whose exporters account directly and indirectly for about nine million American jobs.
Just the same, CEOs of global automakers will lobby fiercely for abeyance from harsh treatment from Trump in order to not take huge losses on the estimated $24 billion (U.S.) they’ve spent on Mexican facilities since 2010. Solar power roads Calgary will be among the first test sites for the roads built with solar panels devised by Bouygues S.A., the leading French engineering firm.
A Bouygues unit focused on exploring the potential of solar-panel roadways began construction of a 2,800-metre roadway in the Normandy village of Tourouvre in October, and has plans for as many as 100 additional test sites in North America, Africa, Japan and countries in the European Union.
The solar roadways are designed to feed power directly into local power grids, to recharge electric vehicles, to power roadway lighting and to light electronic billboards.
Making the innovations possible is the dropping price of solar panels. But so far, the layers of plastic that encase the roadway panels and can withstand an 18-wheeler truck, the electrical wiring embedded in the road, and the anti-slip surface made of crushed glass add up to a costly venture for Bouygues.
It’s a promising one, though: the pilot project in Normandy will generate enough lighting for a town of 5,000 from just a short stretch of road.
Bouygues plans to refine its technology to be competitive with traditional solar-panel farms by 2020, just four years away. And Bouygues has rivals, including Sweden’s Scania and U.S. developer Solar Roadways, further signalling the viability of solar roadways. The twin-engine takeover Twin-engine jetliners like the Boeing 737 are already the civil-aviation industry’s workhorse for domestic routes. And so-called “twinjets” are becoming the mainstay on intercontinent routes, too, thanks to upgraded versions of the twinjets with bigger passenger payloads, more powerful engines and greater fuel efficiency.
But the leaders in the emerging “big twin” sector are the Airbus A350-1000, which last week achieved the goal of Airbus Group SE to have the plane in the air by the end of this year with its maiden flight last week.
The expanded A350 seats 366 people, just 44 fewer than the latest version of Boeing’s 747 jumbo.
It is also cannibalizing sales of Airbus’s own 380 superjumbo, already a slow seller due to resistance of airports to undergo costly retrofits of their terminals to accommodate the world’s only double-decker passenger plane.
And by 2020, Airbus’s new big twin will be competing with Boeing’s 777X, which will carry up to 425 people, and a still bigger, 450-seat big twin yet to be green-lighted.
Experts warn that the aircraft makers shouldn’t give up on the 747 and other four-engine behemoths, since they might enjoy a revival as tourism and business travel recovers.
“The last thing you want to do is abandon that product,” Sandy Morris, analyst at Jefferies International in London, told Bloomberg News, “only to discover in a relatively short time frame that you need to come back into it.” An impressive Trump cabinet pick Wilbur Ross is heavily rumoured to be Donald Trump’s pick for commerce secretary, which will be announced this week.
If it is Ross, Trump will finally have announced a cabinet nominee without ideological baggage who seems tailor-made for his post.
Ross, 78, became a billionaire by consolidating rundown U.S. steel mills and flipping the much-improved operation to Indian-born, London-based Lakshmi Mittal, world’s biggest steelmaker and owner of the former Dofasco Inc.
Dealmaker Trump takes a back seat in that skill to Ross, who has also put together smart deals in the textile, auto parts and coal mining sectors, among others.
Ross’s signature has been deals that work for all parties; that result in more efficient, modernized facilities; and exact a minimum of pain from workforces that are larger than product demand.
Ross was a Democrat until endorsing Trump early this year. He comes across as a rare social-justice industrialist.
Ross told CNBC in June that the U.S. needs “a more radical, new approach to the government” to recognize the justified anger of American workers who have “not really benefited by the last 10 to 15 years of economic activity, and they’re sick and tired of it.”
That prescient comment five months ago largely explains how Trump got elected. Earnings reports this week Tuesday: Bank of Nova Scotia Wednesday: Royal Bank of Canada, American Eagle Outfitters Thursday: Toronto-Dominion Bank, Canadian Imperial Bank of Commerce, Reitmans, Sears Canada, Sears Holdings Corp Friday: National Bank of Canada