MarketLine Blog

Posts written in March 2013

Tough Competition by Chinese Solar Panel Manufacturers

MarketLine

Plunging prices in the photovoltaic (PV) solar panels market has caused a number of bankruptcies, mergers and acquisitions. Additionally, many governments are reducing feed-in-tariff subsidies as part of their austerity measures, affecting the affordability of solar panels for homeowners. With China now manufacturing around 60% of the world’s solar panels, Chinese manufacturers are at the forefront of the solar panel market. As the market consolidates, only those companies best positioned are likely to survive until solar panel prices recover. Suntech Power Holdings is a vertically integrated multi-national solar panel manufacturing… Read more

Siemens’ move from nuclear energy to renewable energy

MarketLine

Following the Fukushima earthquake and tsunami on the 11th March 2011, and the ensuing nuclear disaster, Siemens AG announced on September 19th 2011 its exit from the nuclear power industry. Siemens announced its withdrawal from the nuclear power industry with immediate effect as a result of the March 2011 Fukushima nuclear disaster and due to the position of German society and politics, however the company stressed it was not pressured by the German government. Although there is growing public and governmental distrust of nuclear power production volumes are forecast to… Read more

Where all the Cash is

MarketLine

US corporates, especially tech corporations, represent the most liquid corporations in the world. Moody’s has estimated that the US tech sector holds $550bn in cash reserves, a vast proportion of 38% of all corporate cash reserves in the US. To further narrow this insight, Apple alone held $137bn in cash at the end of 2012. For context, any prospective Cyprian bailout is estimated to cost under €20bn; the British government’s immediate bailout of the banking sector in 2008 was £50bn; and the entire EU budget in 2007 equated to €120.7bn…. Read more

A Realistic Budget on Assumptions of Austerity

MarketLine

Taking “24m people out of tax”, a freezing of the alcohol duty escalator, and more realistic growth forecasts seem to be the big headlines, or rumoured to be headlines resulting or will result from the 2013 budget in the UK. There seems to be little mention of investment, save in social housing – something which, of course, seems to be completely consistent with any conservative growth estimates for the economy. Indeed, the coalition can only take 24 million people out of tax — with a raising in the tax-free allowance… Read more

Bank deposit levy rejected by Cyprus MPs

MarketLine

Prior to the last week, the word ‘Cyprus’ probably conjured up images of an idyllic holiday destination in the Mediterranean or, at a push if you’re a football fan, APOEL Nicosia’s heroic run to the Champions League quarter final last year. This week however, it has become associated with one thing and one thing only: a bank deposit levy. As part of a €10bn bailout package agreed in Brussels, a one-off tax on savings was to be levied, but the plan was today left in tatters as MPs voted against… Read more

Sainsbury’s and Tesco: Retaining market share during the credit crunch

MarketLine

Sainsbury’s looks to be gaining ground on Tesco, at least in terms of sales revenue as the third largest (following Asda and Tesco) supermarket group announced a fourth quarter sales increase of 7.1% (excluding fuel). This, in conjunction with Tesco’s shrinking grocery market share, seems to make Sainsbury’s the biggest ‘winner’ following the horsemeat scandal, as consumers flock to the seemingly better quality meats and provisions in the iconic orange branded stores. Whenever an industry-wide scandal or external shock racks a market or industry, it is a race for PR… Read more

John Lewis faces backlash after it demands rebate from suppliers despite announcing record profits

MarketLine

The John Lewis Partnership is made up of 84,700 permanent staff, or Partners, who own 39 John Lewis shops and 290 Waitrose supermarkets. The Partners also run a John Lewis e-commerce and catalogue business, a production unit, and a farm. The Partners share in the company’s benefits and profits. On March 7th, the company’s financial results for the year ended 26 January 2013 were released. The release pointed to a company that was outperforming with strong results, even in the current economic climate, when many other companies were struggling to… Read more

Farnell acquires CAD company

MarketLine

Premier Farnell (Farnell) is a leading distributor of electrical and electronic components. In 2009, it acquired CadSoft Computer, a publisher of computer-aided design (CAD) software for the design of printed circuit boards (PCBs). While sales of CadSoft products will in themselves contribute only a small amount to Farnell’s revenues, the acquisition shows how Farnell and its rivals are competing on service as well as price. Farnell is a leading high service technology distribution company. This means that it offers customers a wide range of electronic parts, with rapid order turnaround… Read more

JD Wetherspoon hurt by inflation not tax

MarketLine

JD Wetherspoon has called for “tax parity” with British supermarkets citing that the large supermarkets benefit better from the current tax system than pubs. Now, a business calling for tax parity, i.e. equal treatment fiscally, with reasons for doing so limited to the same reasons any other business can give, i.e. inflation, can only be solipsistic. For it is not just JD Wetherspoon and their 800 or so pubs which suffer from a decline in the value of the £, or currently surging inflation, but all other actors in the… Read more

Current events bad for business

MarketLine

As the Cyprian government seizes private assets, and as freedom of speech in the press is about to be curtailed in the UK, a global downturn has proven to be sufficient for various entities to erode the very structures necessary for good business. Above all, business values consistency. And although business has reacted in the UK, in general, quite well to the drop in corporation tax and other supply-side measures, business especially international business does not appreciate hasty reform especially in fundamental areas of the law, in this instance freedom… Read more

Toyota Prius: Innovative Technology and New Power Source

MarketLine

One of the world’s biggest car manufacturers, Toyota launched the first mass produced hybrid car in Japan in 1997. Since then the technology has been improved and other manufacturers have started following Toyota’s lead, creating more advanced cars. The Toyota Prius is sold in more than 70 countries worldwide and the total number of hybrid cars sold as of April 2011 exceeded two million. The Prius third generation model was launched in 2009 and its popularity was expressed by sales in excess of one million by September 2011. Toyota introduced… Read more

Asda rates HMV for brand

MarketLine

With Deloitte administrating the sale of HMV’s stores and assets, Asda has expressed interest in the company’s brand, an intangible which had gone largely unrecognised by previous suitors. Assuming Asda, a wholly-owned subsidiary of Walmart, have done their maths or cost-benefit analyses correctly, the prospect of HMV stores run by, or even situated inside large Asda stores raises questions about the conventional institutional-investor’s approach to “dying” brands and firms. For example, the specialist investor Hilco, reputed for its experience in large divestment operations, has built its own brand on liquidating… Read more

McDonald’s: Remaining Relevant in a Health Conscious Society

MarketLine

McDonald’s Corporation is one of the world’s largest food service retailing chains. The company is primarily known for its burgers and fries, which it sells through more than 32,000 restaurants in 117 countries. In 2010, the company served an average of 64 million customers per day. It primarily operates in Europe, Asia Pacific, and the Americas. The company is headquartered in Oak Brook, Illinois and employs about 400,000 people. McDonald’s has been able to successfully increase revenues and profits in recent years in spite of much negative publicity and an… Read more

Play.com to leave the UK market

MarketLine

Play.com, the online retailer owned by Rakuten, is closing its UK direct retail store business and became an online marketplace. From March 2013, the company will no longer sell directly to customers and will instead, employ a business model similar to Amazon and eBay, allowing its users to list their own items (e.g. DVDs, video games, and electronics), on its website for sale. The closure is a result of the closing of a tax loophole, which exempted items under £15 (around $24) in value being imported to the UK from… Read more

Boeing: The 787 Dreamliner

MarketLine

In 2011, Boeing made the first commercial delivery of its 787 Dreamliner. It is designed to offer airlines enhanced fuel efficiency and long-haul capability in a mid-sized jetliner. This article shows that how Boeing responded to customer demand in order to make the Dreamliner a reality, and how its strategy differed from that of Airbus, its chief rival. Fuel is a major cost for airlines, and its price is likely to continue to rise. This is generating demand for fuel-efficient planes. Boeing’s new 787 was designed to offer ‘super-efficient’ fuel consumption…. Read more

Are we witnessing the death of the traditional book?

MarketLine

Thursday 7th March 2013 is World Book Day; a day when the joy of reading is celebrated and promoted. Numerous events will be held in schools, nurseries, libraries, and book shops across the UK and Ireland. Many children will dress up as their favorite storybook characters and numerous World Book Day tokens will be exchanged for one of eight World Book Day new book releases. A smartphone app will also be launched aimed at young adults, featuring stories from leading teen authors. This delivering of content digitally highlights the era… Read more

Play.com: The Rapid Rise of the Internet Retailer

MarketLine

Play.com, is a Jersey-based, privately owned online retailer. Its main product lines include DVDs, CDs, books, gadgets, video games, DRM-free MP3 downloads, and other electronic products, as well as clothes and accessories. Amongst the largest e-commerce retailers, Play.com was the one recording the most rapid growth, since its establishment in1988. Starting with a focus on selling CDs and DVDs mainly to young, tech-savvy men, the company quickly evolved into one of Europe’s most successful e-commerce retailers. Since the acquisition in second half of 2011, Play.com is a part of Rakuten… Read more

EADS: Life after BAE? Flying High after the Failed Merger despite Challenges in the Defense Sector

MarketLine

The much vaunted merger of BAE Systems and EADS failed to materialize in October 2012 because of political deadlock, generating uncertainty regarding the future of both companies. The full results for the financial year 2012 show that EADS seems to be doing just fine. 2012 saw a 15% increase in revenues for the company, driving it to €56.5bn ($78.6bn) against 2011’s €49.1bn ($68.3bn). Airbus, Eurocopter and Astrium provided the boost, with defense remaining flat. Net income was up 20% to €1.9bn ($2.6bn). Order books were also up 5%. Shares peaked… Read more

Is a Public Preference for Cheap Food Behind the Horsemeat Scandal?

MarketLine

On January 16th, the Food Safety Authority of Ireland said beef burgers with traces of equine DNA were being supplied by subsidiaries of the ABP Food Group. One product was found to be classed as 29% horse. The finding resulted in ten million burgers being taken off the shelves of retailers including Tesco, Lidl, Aldi, and Iceland. Over the next week, Burger King switched supplier from ABP Food Group as a precautionary measure, while Sainsbury’s, Asda, and the Co-op removed some frozen products from their shelves, though none were found… Read more