MarketLine Blog

Posts written in October 2017

Spain in turmoil: Catalan parliament declares independence from Spain

MarketLine

The Spanish region of Catalonia, on October 1, held a referendum on independence, despite fierce opposition from the central government, which said the vote violated the Constitution. The vote was held even after being suspended by the Constitutional Court. The decision to go forward with a vote descended into chaos, with hundreds injured due to clashes with the police and now a mass conflict has appeared between the Spanish authorities and the Catalonians. Catalonia’s withdrawal from Spain would impact the Spanish economy negatively let alone the European Union, but without… Read more

Shinzo Abe reelected as tensions in Asia rise

MarketLine

Japan has in the past decade been hit by two major financial crises. The first one was the global financial crisis of 2008 and the second one came about following the Fukushima nuclear power plant disaster. The latter resulted in a nuclear meltdown and forced the Japanese government to immediately cease operations at all other nuclear power plants in the country, which together generated almost a third of all electricity consumed in Japan. As Japan increasingly relied on fossil fuel powered electricity in the aftermath of Fukushima, increased imports of… Read more

Blue Apron – Changing the way of eating and buying food

MarketLine

The US meal-kit delivery service is projected to be a $5bn market over the next three years. Though space is already crowded, a start-up company, Blue Apron, managed to carve a niche out for itself. By recognizing the educational void for the multitude of home cooks and building a wildly successful business around feeding them, while sharpening their kitchen prowess, the company managed to build a $2bn recipe-delivery business with 2,500 employees, in 36 months. By designing its business model around supply chain efficiencies, the company managed to get fresher… Read more

Flybe Group: Another profit warning issued amidst a chaotic industry

MarketLine

On 18th October 2017, Flybe Group Plc issued a profit warning, the second one following an earlier warning in March. The company warned that profits for the first half of 2017/2018 are expected to be in the region of £5m-£10m ($6.8m-$13.5m), down from adjusted profit before tax of £15.9m ($21.5m) for the same period last year. This follows an announcement in March in which the company revised its profit expectations to a loss for year-end March 2017, rather than the earlier anticipated small profit that had previously been announced. While… Read more

Brexit Uncertainty: London’s status as global financial center under threat

MarketLine

London has, for many years, been one of the world’s major financial centers. Some would even argue that it is the world’s financial center. Banks from all over the globe have offices there, many of which take advantage of the EU’s passporting system to sell their services across the Union.  However, as the threat of a rough (or no) trade deal for the UK becomes an increasingly likely prospect, many banks are looking to move their  European headquarters out of the City or at least relocate large numbers of staff… Read more

eSports continues to grow in popularity: However challenges like match-fixing amplify the need for more regulatory bodies

MarketLine

eSports has grown at an impressive pace in recent years, and this rise has attracted the interest of globally recognized sponsors and sporting clubs. As the speed of internet has increased as have broadband connectivity levels, and the ease of playing games online has substantially increased. Sensing this opportunity brands like Intel and Red Bull as well as sporting clubs like Paris Saint-Germain and the Philadelphia 76ers have entered eSports as sponsors. However as the popularity of eSports has increased, so have the challenges it faces. One notable example is… Read more

Tata-ThyssenKrupp merger: Deal will have short-term impact but doubts remain over long term

MarketLine

The merger of the European steel making section of Tata and German based ThyssenKrupp will likely have useful short-term impacts upon European production, but the benefits heading into the long-term future are less clear. Soon to be the second largest steel maker in Europe, the combined company will have sufficient bulk to compete much better with Chinese producers who are under pressure from the central government to consolidate. Chances are the new company will gain substantial efficiencies and improve product quality beyond other major rivals, but this only solves some… Read more

Ginkgo Bioworks: Quest to disrupt the biotech space

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Ginkgo Bioworks, a Boston-based DNA writer and designer company, launched in 2008, is already one of the largest DNA writers in the world. It is expected to make over $20m in revenue in 2017. Ginkgo’s success is based on an innovative technology that uses yeast as a base to make all kinds of substances, including perfumes, cosmetics and sweeteners, from microbugs. This technology can be used across a whole host of consumer and industrial products, enabling customers to grow rather than manufacture better products. The company is currently working on… Read more

Puerto Rico Reform: Doomed before Hurricane Maria even struck, but plans to bring back prosperity begin

MarketLine

On the evening of September 16 2017, Puerto Rico was struck by Hurricane Maria. With a huge economic downturn over the last decade and a $70bn debt bill from the US, this has added greatly to the Puerto Rico’s current problems. President Trump has spoken clearly about the debt problem and has shown little empathy to the US territory. The damaged infrastructure on the island has attracted  commercial interest from the likes of Google and Tesla, with companies like these speaking about plans to help  Puerto Rico reform. The Puerto… Read more

Norwegian: The low cost airline with ambitions to fly long haul

MarketLine

Norwegian Air is a no frills fly service that is looking to shake up the long haul industry. For a number of years the rapidly growing budget airline players have been considering moving into this sector but technical problems, regulatory issues and competitors have got in their way. Norwegian Air however, has found a way and now offers a number of routes from Europe across the Atlantic using the new breed of efficient yet smaller airplanes from Boeing and Airbus. However, this transition is not without issues and availability of… Read more

Toshiba NAND business sold: Business must reform or risk becoming a ‘zombie’ company

MarketLine

Now the immediate future of Toshiba has been secured through the $18bn sale of the NAND business, the company must scale down operations to become sufficiently nimble and competitive enough to become prosperous again. With all the large profitable sections sold or bankrupt, Toshiba now mainly exists as a collection of firms which are low-growth and unlikely to yield consistent profits. To solve this problem the company must sell or close the worst performers and use any funds raised to help the company expand again. If this course of action… Read more

Monarch Airlines: Management not to blame for collapse of UK’s longest-serving airline

MarketLine

In the early hours of Monday October 2, 2017, KPMG announced that it had entered the office of Monarch Airlines and the company had officially entered administration. In the following hours the Civil Aviation Authority chartered 30 planes from across Europe to repatriate some 110,000 British citizens and customers who were then stranded abroad with no return flights. Cancellations of every flight from October 2 and onwards have affected some 300,000 bookings and likely close to a million individuals, and Monarch’s departure from the short-haul flight market will almost certainly… Read more

INEOS Automotive: Chemical giant stepping into the automotive manufacturing space

MarketLine

INEOS is a private multinational chemical company operating out of the UK, with annual revenues of over $4bn. The company grabbed headlines in 2016 when it announced a serious intention to find some way to continue to produce the iconic British vehicle, the Land Rover Defender. Land Rover had announced the winding down of the long running Defender, citing emissions regulations and the old design of the vehicle as the primary reason and is widely expected to announce a new version of the vehicle in the coming years. However, INEOS… Read more