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Exclusive: Volkswagen in talks to manage Didi fleet, co-develop self-driving cars

BEIJING (Reuters) – Volkswagen AG (VOWG_p.DE), the world’s biggest automaker, is in talks to form a joint venture with China’s Didi Chuxing to manage part of the ride-hailing company’s fleet of cars and help develop “purpose-built” vehicles for Didi’s services.

FILE PHOTO: A car with the Volkswagen VW logo badge is seen on display at the North American International Auto Show in Detroit, Michigan, U.S., January 16, 2018. REUTERS/Jonathan Ernst/File Photo

As part of the deal between Volkswagen and China’s biggest ride-hailing service, expected to be signed early next month, the German automaker will initially manage a fleet of about 100,000 new vehicles for Didi, of which two-thirds will be Volkswagen Group cars, said a senior executive at the carmaker.

Volkswagen will also jointly buy some new cars with Didi to allow the Chinese company to expand its fleet. The two eventually plan to collaborate to design and develop dedicated vehicles, he said, speaking on condition of anonymity as the details are still private.

The executive did not give financial details of the deal but said that Volkswagen will get a slice of the revenue once the venture develops.

The growing popularity of ride-hailing services for commuting and running errands in congested cities such as Beijing and Shanghai is showing early signs of reducing private car ownership. This could have serious consequences for existing carmakers and is forcing companies like Volkswagen to reinvent their businesses and seek out future revenue streams.

“To succeed as a car company in this new ecosystem, we need to know who our customer is, what their journey is and what our strategy should be,” the executive said.

He added that this deal will eventually give Volkswagen access to some of Didi’s massive trove of data on customer behavior collected through the 3 million rides Didi provides in China each day.

The ultimate goal is the production and use of autonomous cars, the Volkswagen executive said.

RIDING ALONE

Volkswagen’s partnership with Didi is the first known project Didi has begun pursuing as part of a broad alliance the Chinese company recently formed with 31 automakers and parts suppliers.

Didi has said it formed the alliance to collaborate on, among other things, eventually developing cars purpose-built for its services.

FILE PHOTO: The logo of Didi Chuxing is seen at its headquarters in Beijing, China, May 18, 2016. REUTERS/Kim Kyung-Hoon/File Photo

For instance, as many as 80 percent of Didi customers ride alone and don’t need a big four-seater car, the Volkswagen executive said.

And current vehicles have engines and other technology that allow them to go as fast as 150 mph (250 kmph). Dedicated ride-sharing vehicles would always travel much slower, so they would not need to be aerodynamic or have a powerful engine. That could allow for fewer seats and more room for luggage.

Didi has also predicted much of its future fleet would be electric. The company has begun working with Chinese carmakers GAC Motor and CHJ Automotive to design electric vehicles, sources have told Reuters. [nL3N1S13XC]

Three Didi officials said the ultimate shape of a new ride-sharing market is still unclear and no one knows what role car manufacturers and Didi itself will play in it.

Open questions for Didi are how to repair, maintain and direct a fleet of autonomous vehicles, one of the officials said.

“Our understanding right now is that probably automakers don’t know 100 percent how to do all that. Didi also doesn’t know either,” the official said.

A spokesperson for Didi said both sides were still working out the details of how the partnership would look.

“Potentially, both parties will focus on building together a fleet operation business, and look into other potential areas such as designing new car models for ride-hailing,” the spokesperson said.

The Didi officials did not want to be named because they are not authorized to talk to reporters.

After years of resistance and efforts to keep technology-based ride companies at arm’s length and vowing never to be like contract manufacturers are to the mobile phone sellers, carmakers are becoming more flexible.

The car industry fears becoming like Taipei-headquartered electronics company Foxconn (2354.TW), which manufactures millions of phones for the likes of Apple Inc (AAPL.O) but only gets a slim share of the profits in return.

This year, automakers like Fiat (FCHA.MI), Jaguar Land Rover and Honda Motor (7267.T) entered into an agreement to provide thousands of cars to Alphabet Inc’s (GOOGL.O) self-driving unit, Waymo. Last year Volvo (VOLVb.ST) and Daimler AG (DAIGn.DE) said they would supply cars to Uber.

VW’S WAR CHEST

Volkswagen lags its rivals Daimler and BMW (BMWG.DE) in embracing the transformation but has recently stepped up its efforts.

It has created a war chest of 15 billion euros ($18.2 billion), which it plans to use for investments in ride-hailing, autonomous driving, digitalization, electric mobility and other services in China by 2022.

It has already invested in an artificial intelligence firm called Mobvoi, a car-sharing company Shouqi and a second-hand car buying company. Volkswagen is also in talks to invest in a luxury ride-hailing company and an electric car charging business, the executive said.

Once Volkswagen has access to customer data, it will be able to make better-informed decisions on future businesses and products.

“We will explore additional business models with Didi,” the executive said, adding that these may not necessarily be focused only on China. Volkswagen is internally discussing bus and truck sharing.

“We don’t need to have all the answers. The money we plan to put into the first phase should help us find some,” he said.

The executive did not say whether the new cars provided by Volkswagen would be electric, hybrid or gasoline.

($1 = 0.8245 euros)

Reporting by Aditi Shah and Norihiko Shirouzu in Beijing; Editing by Gerry Doyle and Martin Howell

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/yK2dQ8qLHhU/exclusive-volkswagen-in-talks-to-manage-didi-fleet-co-develop-self-driving-cars-idUSKBN1I10YP

Epiroc makes sound start

According to Atlas Copco’s financial figures for the three months to March 31, Epiroc enjoyed an 18% growth in orders received compared with the same period in 2017.

It also had an 11% jump in revenues to 8.2 billion Swedish krone (US$945 million) and a 7% rise in operating profit to SEK1.5 billion. The reported operating profit includes SEK95 million in one-time costs related to the split and the listing process.

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The demand for equipment and service continued to increase, with organic order intake up 22%.

The strong order growth was primarily related to miners starting to expand investments in or adjacent to existing mines. That had a particularly positive impact on rock drilling equipment sales for surface applications.

The reported operating margin was 18.4%, down from the 19.1% for the same time last year.

That margin was negatively affected by currency and one-off costs related to the split and listing process. Those costs equated to 1.2% of revenues.

During the quarter Epiroc introduced a line of diamond coring tools.

The new bits cover a wider range of applications, which means fewer bit types than before are needed, making it easier to select the optimal bit for the job. This helps drillers improves productivity and helps drilling contractors reduce the risk of failing to meet deadlines.

Epiroc also bought Australian company Hy-Performance Fluid Power, which remanufactures, services and repairs hydraulic components for drill rigs.

Hy-Performance Fluid Power had annual revenues of SEK50 million in the 2016-17 financial year.

Atlas Copco’s share price was up 3.9% early today at SEK346, giving the company a market capitalisation of SEK412 billion.

 

Article source: http://www.mining-journal.com/stocks-market-insight/news/1337149/epiroc-makes-sound-start

Up, up … and away?

‘Build it and they will come’, is an adage from the entertainment and construction industries but, with a slight variation, it’s a saying that might take hold in mining, which has woken to the threat of rising costs that mean it’s time to ‘build it before costs explode’.

Article source: http://www.mining-journal.com/miner-s-right/opinion/1337148/up-up-%E2%80%A6-and-away

AT&T court fight with U.S. Justice Department heads into closing arguments

WASHINGTON (Reuters) – Lawyers for the U.S. Justice Department and ATT (T.N) will give closing arguments on Monday in a trial to determine if the wireless giant, owner of pay TV provider DirecTV, will be allowed to buy movie and TV show maker Time Warner (TWX.N).

Chief Executive Officer of ATT Randall Stephenson (L) walks off the stage with David McAtee (C), SEVP and General Counsel for ATT, and Daniel Petrocelli (R), counsel from O’Melveny Myers LLP., after a press conference in New York City, New York, U.S. November 20, 2017. REUTERS/Shannon Stapleton

The Justice Department sued to block the $85 billion deal, saying it would lead to higher prices for rival pay TV companies.

The government has argued that ATT viewed the merger as a way to convince viewers to stick with pay TV instead of moving to cheaper online providers, at one point quoting from a report in which an ATT executive said that buying Time Warner would allow ATT to slow the decline of pay TV subscriptions, which was described as a “cash cow.”

FILE PHOTO: A Time Warner logo is seen at a Time Warner store in New York City, October 23, 2016. REUTERS/Stephanie Keith/File Photo

ATT’s satellite television service DirecTV lost 187,000 traditional U.S. video customers in the first quarter of 2018.

The judge’s decision, which is expected in several weeks, will guide dealmakers on how aggressive they can be in buying suppliers, what is known among antitrust people as a vertical merger. Until this tie-up, vertical deals were largely considered approvable by regulators.

Two key witnesses at the trial were ATT Chief Executive Randall Stephenson and Time Warner CEO Jeff Bewkes, who is retiring if the transaction goes through.

The two executives argued that marrying ATT’s granular information about customers with Time Warner’s ability to create compelling video would allow them to advertise more effectively, giving the merged company a fighting chance to compete with internet advertising titans like Facebook and Google.

They also denied as “ridiculous” and “absurd” the notion ATT would be reluctant to license Time Warner content like CNN or March Madness basketball to other pay TV rivals or to cheaper online video companies — a key government argument.

In hopes of preventing a court fight, ATT proposed that for seven years it would submit to third-party arbitration any disagreement with distributors over the pricing for Time Warner’s networks and promise not to black out programming during arbitration.

But smaller pay TV rivals called as government witnesses argued that this was inadequate. Warren Schlichting, group president of Dish Network’s (DISH.O) Sling TV, argued ATT’s offer was inadequate because it was limited to 7 years and HBO is not part of the proposal.

Reporting by Diane Bartz, Editing by Franklin Paul

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/6n4jDexTn1U/att-court-fight-with-u-s-justice-department-heads-into-closing-arguments-idUSKBN1I10SP

Tongon strikes hit guidance

It said in a statement over the weekend that a series of work stoppages in the March quarter, caused by industrial action by mining contractor employees, which then spread to other operations, would affect its ability to reach the mine’s guidance.

However, the company was “making a determined effort to recover most of the lost output”, with operations back at full capacity. 

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These efforts included processing ore from the run-of-mine and scat stockpiles during the stoppages and upgrading parts of the plant during the downtime to achieve higher and more consistent throughput in the future.   

Randgold CEO Mark Bristow kept the total group guidance for the year at 1.3-1.35 million ounces.

He said in the weekend statement that mine management, government, local authorities, workers and union leadership had all worked together to resolve the situation and to use a constructive process to workshop solutions and prevent similar issues in the future. 

“The history of Tongon has reflected the occasionally turbulent sociopolitical nature of its environment and a misunderstanding of the mining business, which is a new activity in the country, but management has dealt effectively with the challenges that have come their way,” he said.

Tongon last had labour issues in January 2017 when operations stopped for five days as some employees took part in an illegal sit-in demanding ex-gratia payments. 

The mine was commissioned in 2010 and has since produced 2.7 million ounces of gold, with record results in 2017.

“Tongon has three-and-a-half years of life left as things stand, but we are actively looking for means to extend this and a number of exciting near-mine opportunities are currently being evaluated by the exploration team,” Bristow said.

He added that Randgold was also exploring for new gold discoveries in other areas of its large permit portfolio in Côte d’Ivoire.

Randgold’s shares were trading at £59.24 (US$81.39) Monday, up 0.17% from the previous close.

 

Article source: http://www.mining-journal.com/politics/news/1337147/tongon-strikes-hit-guidance

World stocks set for positive April as big ticket M&As return

SYDNEY (Reuters) – World stocks are set to notch up a positive month for the first time since January, as a slew of positive earnings from U.S. technology firms and marquee MA deals help soothe memories of February tremors.

FILE PHOTO: A man looks at an electronic stock quotation board outside a brokerage in Tokyo, Japan February 9, 2018. REUTERS/Toru Hanai/File Photo

A seemingly successful Korean summit between the leaders of the North and South on Friday added the icing on the cake, pushing Asian bourses higher on Monday.

MSCI’s all-country index of global equities .MIWD00000PUS is up 1.3 percent for April ahead of another torrent of first quarter earnings, with Apple (AAPL.O) the standout report on Tuesday.

This after strong earnings reports from Facebook (FB.O) and Amazon (AMZN.O) gave tech stocks across the world a shot in arm last week.

Reports of large MA deals, led by T-Mobile’s proposed merger with Sprint in the U.S. and the Sainsbury’s and ASDA merger in the UK, also kept global stock markets firmly in the spotlight.

“Large MA news shows that confidence is there for making big deals. And while I would suggest not all of the recent deals are positive, the ASDA-Sainsbury’s one looks particularly good and the stock price reactions seems to bear that out,” said Michael Hewson, an analyst at CMC Markets.

Sainsbury’s (SBRY.L) shares shot up 20 percent at the open after the retailer agreed a 13.3 billion pound merger with Walmart’s ASDA, and the news shook up retail stocks in Europe.

Overall, the pan-continental STOXX index rose 0.1 percent while Germany’s DAX .GDAXI gained 0.3 percent, buoyed by investors’ improved risk appetite.

This after Asian shares extended gains on Monday as tensions in the Korean Peninsula eased and first-quarter earnings shone, although some investors were cautious about the outlook amid the backdrop of a simmering U.S.-China trade dispute.

MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS climbed one percent, adding to a similar rise on Friday. The index is now poised for a modest rise this month after two consecutive losses.

South Korea’s KOSPI index .KS11 jumped 0.8 percent and is set to end April more than 2.5 percent higher following record profits from tech giant Samsung Electronics (005930.KS) and after a successful inter-Korean summit.

On Friday, South Korean President Moon Jae-in and the North’s leader Kim Jong Un agreed to end hostilities and work toward “complete denuclearisation” of the Korean peninsula.

“The direction of travel is more positive that it was at the end of last year and geopolitics is now not the concern it was in the beginning of April,” said Hewson of CMC Markets.

“But the potential for trade wars would be the main issue for me going forward, that’s the clear and present danger and what effect it may have on oil prices,” he added.

Oil prices eased from recent highs with Brent crude futures LCOc1 off 94 cents at $73.70 a barrel, while U.S. crude CLc1 lost 67 cents to $67.43.

The dollar meanwhile held steady just below its strongest level since mid-January against as basket of currencies .DXY as traders awaited U.S. consumer spending numbers to see whether the greenback can continue its recent run of gains.

The U.S. Federal Reserve is also due to meet this week, and while no rate hike is expected, investors will look for clues on the future pace of hikes.

“There might be a tweak to the inflation language acknowledging the move towards two percent on year-on-year inflation rather than ‘have continued to run below two percent’”, Deutsche Bank strategist Jim Reid said in a note.

The U.S. payroll number is also due Friday.

German inflation numbers are also set to be reported later on Monday, with investors expecting the continent’s largest economy to record consumer price rises of 1.6 percent.

The question is whether this will translate to a push for euro zone inflation towards the European Central Bank target of just below two percent.

Euro zone bond yields have remained well below the year’s highs. Germany’s 10-year government bond yield was up a basis point on Monday but still firmly below the 0.60 percent mark. DE10YT=RR

Reporting by Abhinav Ramnarayan, Editing by William Maclean

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/SLaUqvs2gKM/world-stocks-set-for-positive-april-as-big-ticket-mas-return-idUSKBN1I101A

Two directors join the Hummingbird nest

They will replace directors Matt Idiens and Dave Pelham, who plan to retire after the company’s annual general meeting later this year.

Both directors will also join the company’s technical advisory committee, of which Roux has been made chairman.

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He was most recently COO of Endeavour mining and has over 42 years’ experience in the mining industry, with previous experience at Anglo American, De Beers and AngloGold Ashanti.

Nutter was a mining analyst at Capital Group from 2004 until he retired in 2017. Prior to this he spent 13 years at RBC Capital Markets where he was managing director after being the bank’s director of global mining research and chairman of the strategic planning committee.

Article source: http://www.mining-journal.com/leadership/news/1337145/two-directors-join-the-hummingbird-nest

Hummingbird picks up speed

The company plans to produce 105,000-115,000 ounces of gold in 2018, including the March quarter.

It produced 18,785oz of gold at an average grade of 2.96g/t during the three-month period, with 9,912oz poured in March alone.

Total ore processed during the period was 238,628 tonnes at a recovery rate of 96.1%.

The company completed construction of the plant and commissioning in late 2017 at an $88.5 million budgeted capital cost, with first gold poured in late December.

Hummingbird CEO Dan Betts said Yanfolila’s ramp-up phase had gone according to plan, with a significant increase in performance, the process plant operating to design specification, and the grade and recoveries of gold “solid and consistent with expectations”. 

“Progress has been strong and I am pleased that we are able to declare commercial production from April a, 2018 with the plant having operated at over 95% of nameplate for the month of March and continuing to operate at 100% throughout April,” he said.

Hummingbird sold 11,941oz of gold during the quarter at an average price of US$1,332 per ounce.

The company ended the March quarter with cash of $28 million after completing capital expenditure payments during the period and delivering Yanfolila on budget.

Going forward, Betts said Hummingbird aimed to ensure Yanfolila’s was a consistent low-cost operation, but it also wanted to explore and develop near-mine resources to possibly convert opportunities and resources into reserves and an extended mine life.

“We have committed to spend up to 15% of our free cash flow into this activity which is anticipated to be in the region of $8 million,” he said.

Cantor Fitzgerald Europe director of metals mining research Asa Bridle said Hummingbird appeared to have made a successful transition from developer to producer at Yanfolila.

He reiterated the the bank’s “buy” rating for Humming bird and the 41p (US56c) taregt price.

Hummingbird’s shares were trading at 32.5p Monday, up 1.56% from the previous close.

 

Article source: http://www.mining-journal.com/research/news/1337144/hummingbird-picks-up-speed

Micromine 2018 is now available for download

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Article source: https://www.micromine.com/micromine-2018-is-now-available-for-download/