over 2 years ago • 3 mins
Ford announced on Friday that it’s aiming to take electric vehicle (EV) production from zero to 600,000 in two years flat.
What does this mean?
The EV battle among veteran carmakers has been heating up lately, with the likes of General Motors and Volkswagen both selling over 200,000 EVs last year. Ford, meanwhile, has sold… none. Nada. Zilch. But it’s finally catching on: the company just said it’s aiming to double its original production target of 300,000 EVs by the end of 2023. And sure, that 600,000 is still a long way short of the 1 million that Tesla is forecast to sell that same year. But try telling that to Ford’s CEO: he thinks Ford could eventually take the market leader’s top spot.
Why should I care?
For markets: Ford will trade you chips for batteries.
Ford’s share price hit a two-decade high this month, and there could be a couple of reasons why. For one thing, the company’s managing the global chip shortage better than other carmakers, and that looks set to continue given Ford’s new partnership with contract chipmaker GlobalFoundries. And for another, investors are excited about the carmaker’s big EV push. But there’s a problem: Ford might not actually be able to make or source all the EV batteries it needs. In fact, EV battery research firm Benchmark Mineral Intelligence reckons Ford will produce just 900,000 EVs a year by 2030 – well below what’s expected of other carmakers.
The bigger picture: Apple’s at it again.
Apple’s not about to let the carmakers have all the fun: the tech giant’s been fast-tracking the development of its own electric car, which will reportedly arrive as early as 2025. And even if it wants to slam the brakes on the whole project, it might struggle: Apple’s focusing on full self-driving capabilities, with the car rumored to have no steering wheel or pedals.
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Data out on Friday showed UK retail sales rose for the first time in six months in October, as Christmas shopping for the kids makes child’s play of the country’s recovery.
What does this mean?
You know what they say: ‘tis the season to get the jump on supply shortages and shipping delays. And Brits are certainly getting in the spirit, sweeping clothing and toys into their carts so they’re not faced with empty shelves nearer the holidays. That drove UK retail sales up by a better-than-expected 0.8% last month compared to September, on the heels of five months of either no growth or shrinkage – the country’s longest spending slump since 1996. Even better, Christmas shoppers were a-shopping despite pricier products, with recent data showing that UK inflation hit its highest in nearly a decade last month.
Why should I care?
For markets: Rate hikes, please.
Friday’s data will come as a relief to the Bank of England (BoE), which said earlier this month that it was worried consumer spending was slowing down. Add in last week’s strong jobs report, and the BoE should be more confident that the UK economy can handle any of its inflation-fighting measures – like, say, a much-anticipated interest rate hike. That news wouldn’t be welcomed by everyone: the UK government would have to pay more interest on any new bonds it issues, when fresh data showed that the interest it paid in October was already over three times higher than a year ago.
The bigger picture: Will lockdowns ruin the party?
Let’s not jump the gun: coronavirus cases are still high in the UK, meaning another economy-damaging national lockdown is a distinct possibility. That’s already happened in Austria – which announced its fourth last week – and Germany’s not ruling anything out either. That would be seriously problematic for Britain: its last national lockdown in January saw retail sales slump 8.2% from the month before.
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