Connect with us

World

Climate change worries push travelers to these ‘last chance’ locales

Published

on

Travel interest boost: 68 percent

The Maldives has seen the biggest spike in travel, as the island nation uses mass tourism to raise the funds necessary to adapt to climate change. That includes relocating thousands of people and building the necessary infrastructure to accommodate them.

The paradise atolls, famous for their turquoise waters and idyllic beaches, may be under water by 2100, according to the United Nations. That’s a fate the Maldives is trying to avoid.

Last year, tourists flocking to the Maldives insured an average of $3,593 in nonrefundable costs, an 11 percent increase from the year before, according to Squaremouth. Those costs could include airfare, hotel, and recreational activities.

Round-trip plane tickets from New York City to the Maldives cost around $1,000 on the low end, while hotels can range from under $50 to around $2,000 per night, depending on the level of amenities.

Source link

World

Chinese electric car makers target Europe as competition heats up

Published

on

Nio plans to begin deliveries of its ET7 electric sedan in 2022.

Evelyn Cheng | CNBC

SHANGHAI — After the last year of growth in the world’s largest auto market, China’s electric car start-ups are stepping up plans to take on Europe.

Chinese authorities only began peeling back restrictions on full foreign ownership of local automobile production in the last few years. But more than a decade ago, Beijing began spending the equivalent of billions of dollars on developing its own electric vehicles.

That’s helped local players gain an edge in producing battery-powered cars, which they’re now aiming to sell overseas. Goldman Sachs analysts predict that in four years, new government policies mean electric cars will account for a greater share of auto sales in Europe and the U.S., versus China, although it is the largest market.

U.S.-listed Nio has said it would enter Europe in the second half of this year. And on Monday, co-founder and president Lihong Qin said the company expects to make an official announcement about such an expansion within a month.

He did not name a specific country, while stating that after Europe, Nio still intends to enter the U.S. market.

Amid tensions with the U.S. and attempts to seal an investment deal with Europe, China exported 63,500 pure battery-powered electric vehicles during the first eleven months of last year, according to a January report from the China Chamber of Commerce for Import and Export of Machinery and Electronic Products. While Saudi Arabia and Egypt were the top destinations for Chinese cars overall last year, the report noted significant growth in vehicle exports to the U.K., Belgium and Germany.

U.S.-listed Xpeng is already testing the waters in Norway, where the start-up delivered 100 units of its G3 electric SUV in December.

Later this year, Xpeng hopes to see how customers in northern Europe respond to its P7 electric sedan, said He Xiaopeng, chairman and CEO. He is recruiting new staff and plans to set up a company in the region, before looking at western and eastern Europe.

Another Chinese electric car start-up, Aiways, said it exported more than 1,000 vehicles to Israel and Europe in the first three months of this year.

“It’s no secret now that most of the China EV startups have global ambitions,” said Tu Le, founder of Beijing-based advisory firm Sino Auto Insights. “That’ll continue as these companies chase growth and value and see opportunity due to the lack of viable EVs products in the region.”

He said with enough local research, some of the Chinese companies could succeed in Europe.

However, any growth in Chinese electric car sales to Europe remains a tiny fraction of the market.

China accounted for less than 2% of the EU’s passenger car imports in 2019 and the 865 million euros in value marks 79% growth from the prior year, according to the European Automobile Manufacturers Association.

In contrast, EU-owned automobile manufacturers made almost 6 million passenger cars in China in 2018, for almost a quarter of total Chinese car production, the association said.

Rising competition within China

The Chinese start-ups’ venture overseas comes as the market heats up at home. Nio’s Qin said the entry of tech companies like Apple and Huawei into the industry are creating fierce competition for the car maker.

On the automobile front, Tesla leads the market and is ramping up local production. Its Model 3 was the best-selling electric car in China last year, according to the China Passenger Car Association.

Excluding two mini-electric cars, the association said the next best-selling vehicle in the category was the S model from Aion, a new energy brand spun-off from Chinese state-owned automaker GAC. A more expensive model from Nio ranked ninth, while Xpeng didn’t make the top ten list.

“Chinese consumers understand new energy vehicles more and more,” said Aion’s planning department director Qiu Liangping, according to a CNBC translation of his Mandarin-language remarks. In addition to ease of battery charging, he said Chinese buyers are looking for a better driving experience than that of fossil fuel-powered cars and internet-powered features.

The brand also has its eye on the international market, Qiu said. Before the spin-off, Aion and GAC’s Trumpchi brand were already selling cars in Israel, the Middle East and South America.

As the automobile industry moves further into electric power, traditional U.S. and German car companies are launching their own electric vehicles — many in the Chinese market first.

For example, General Motors’ Cadillac brand unveiled its Lyriq electric car at the Shanghai auto show, with pre-orders in China beginning later this year, according to the company.

Ford also used the show to reveal its locally made version of the Mustang Mach-e electric car, as well as a largely China-developed Evos SUV that will only be available in the country.

Volkswagen revealed in Shanghai a third electric car for China, the ID.6. The German automaker aims that by 2030, at least 70% of its cars sold in Europe in electric, and at least 50% for cars sold in North America and China.

Source link

Continue Reading

World

Facebook, Google and Amazon are reaping the benefits from advertising’s pandemic hot streak

Published

on

The logos of Google, Facebook, Instagram, Twitter, Snapchat and TikTok displayed on a computer screen.

Denis Charlet | AFP via Getty Images

Digital advertising’s hot streak appeared to have lasted into the first quarter as travel starts to return and e-commerce spend persists, analysts say. 

Snap will be the first of the major ad-supported internet companies to report earnings on Thursday, while Alphabet‘s Google, Facebook, Pinterest, Twitter and Amazon will follow next week. These players have seen outsized benefit as certain stay-at-home trends have been accompanied by massive shifts into digital ad spend. 

Bernstein analysts wrote that if the fourth quarter of 2020 was digital advertising’s “perfect storm,” then the first quarter of 2021, and perhaps the rest of the year, will be “hurricane season.” 

“Undercurrents supporting a strong digital ad year include an accelerating upgrade cycle from image to video, TV ad ripe for picking, and brand spend returning,” they wrote. “Investor expectations for the 1Q prints are high across the board, though not without a little noise in the run-up to earnings.”

Some digital ad players had been expecting impact of Apple’s privacy change, which goes into effect next week, to have impact in the first quarter. Bernstein analysts noted that the “IDFA boogeyman mostly missed 1Q, but an imminent rollout of Apple’s policy could well hamper 2Q guidance commentary and management Q&A.” 

The quarter also offered a time when some consumers were starting to spend on travel or return-to-work clothes, while others were still in lockdowns and were still looking for “distraction and delivery.” 

Industry analysts have said they’ve seen evidence of strong digital ad growth in the first quarter, in part due to heightened e-commerce spend that was helped by the latest stimulus checks. Meanwhile, search is expected to steadily come back throughout the year as travel brands expand budgets

But digital ad-supported tech companies’ earnings later this year will also show how likely certain trends that helped them soar during the pandemic, like e-commerce, will bear out in the future.

Evercore analysts pointed out that June will be the first tough comp quarter for e-commerce names and the ability of these “Covid winners” to maintain big growth will help determine if there is a permanent pull forward of demand. 

Here’s what else analysts have to say about the major ad-supported tech players as they prepare to report their first-quarter earnings. 

Snap

Some analysts see Snap’s revenue guidance for the first quarter as conservative since the company’s management had previously indicated it expected to start seeing some impact from Apple’s privacy changes in the quarter. J.P. Morgan analysts said they believe Snap’s revenue guidance of 56% to 60% growth should prove conservative.

Evercore analysts echoed that, saying that the 60% growth could be potentially conservative given positive channel checks and given the fact that the company said growth could be in line with the fourth quarter if momentum continued. They mentioned that Snap’s acquisition of Fit Analytics, which helps consumers pick the right size of clothing when they shop online, is consistent with Snap’s strategy to materially ramp up monetization using augmented reality. 

“Examples include Snap’s partnerships with Clearly (eyewear retailer), Levi’s and Estee Lauder which all benefit from the ‘trialability’ that AR uniquely delivers,” they wrote. “While we believe FB and PINS are better plays on the Social Commerce wave, we are increasingly appreciative of SNAP’s potential to participate.” 

Wedbush analysts said that Snap more than doubled its advertiser count year-over-year in the fourth quarter of 2020, showing an inflection point for Snap as product investments are bearing fruit. But they still see room to grow.

“Snap has made material improvements in its ecommerce offerings, but is still in the very early stages of what we view as a long-term opportunity in social commerce, particularly through its augmented reality offerings,” they wrote.

Facebook

Canaccord Genuity analysts said they expect another quarter of strong ad growth for Facebook, at 33% year-over-year. They wrote that would be consistent with management expectations that the ad revenue growth rate would remain stable in the first half of 2021 as any easing of e-commerce tailwinds are offset by easier comps. 

Evercore analysts believe that 33% year-over-year is potentially conservative, and foresee a 35% year-over-year growth. “As a side note, we believe that the very robust small business formation in the U.S. over the last 6 [to] 9 months has also been a big new driver of ad revenue growth for FB,” they wrote.

Wedbush analysts recently initiated coverage for Facebook with a neutral rating, citing headwinds from stronger privacy standards. 

“We’re bullish on the commerce initiatives Facebook is building into its platform,” they wrote. “While we do expect continued strength in those areas, a rebound in the overall ad market, and a continued shift towards integrating commerce into the platform, but are also balanced by our view that Facebook is the most exposed to privacy risks, particularly around Apple’s App Tracking Transparency (ATT) efforts that will limit the Identifier for Advertisers, or IDFA.” 

They wrote that what has been Facebook’s biggest competitive advantage could turn into a near-term headwind as the digital ad world recalibrates around new privacy standards. 

“We’re not making a call of Facebook’s impending demise, but believe as the privacy landscape changes, there could be a more relative share gain from smaller digital platforms which also have strong commerce functionality,” they wrote. 

Google 

Analysts foresee Google’s ads business as seeing a strong first quarter, given a rebound in search and brand advertising along with continued momentum for YouTube ads. 

Bernstein analysts noted that YouTube ended 2020 on a “phenomenal note,” growing its ads business 46% year-over-year in the fourth quarter. With a rebound in brand ad spend and strong user engagement, “the party should continue in 1Q and we forecast a 50% Y/Y growth rate for the quarter.” 

“The $60 [to] $70B US TV advertising market poised to finally go digital and the channel checks corroborate as much,” they wrote. They said YouTube may be best positioned to capitalize on this growth, with premium services like YouTube Select and traction on shoppable advertiser offerings on the platform.

Canaccord Genuity analysts said they expect Google’s fourth quarter growth will continue momentum into the first quarter as consumer activity normalizes and the vaccine rollout likely drove increasing search interest for travel. Analysts foresee a 24% year-over-year total ad revenue growth.

Evercore analysts also see the street’s ad revenue growth expectations of 22% year-over-year as conservative. They expect to see a 27% year-over-year growth in ad revenue. 

“We believe Google’s exposure to Travel and strong positioning in Local (i.e., physical stores) will provide tailwinds for ad revenue growth under a reopening scenario,” they wrote. 

They added that online retail sales growth will mean positive numbers for e-commerce ad budgets, which are a top vertical for Google. On top of that, they wrote TSA data shows a positive inflection in volumes from the beginning of March to April. Evercore analysts estimate travel had been 10% and 15% of Google’s pre-Covid ad revenue. 

Mizuho said in a note that industry checks with a major agency showed Google’s U.S. search spending growth has accelerated. Travel growth, in particular, moved from -20% year-over-year in the fourth quarter 2020 to 5% in the first quarter of 2021, the note said.  

Amazon

Pinterest

Twitter 

Source link

Continue Reading

World

Formula 1’s expansion in the U.S. is in motion, now it needs a star American driver

Published

on

Lewis Hamilton of Great Britain driving the (44) Mercedes AMG Petronas F1 Team Mercedes WO9 leads Max Verstappen of the Netherlands driving the (33) Aston Martin Red Bull Racing RB14 TAG Heuer on track during the Formula One Grand Prix of Great Britain at Silverstone on July 8, 2018 in Northampton, England.

Charles Coates | Getty Images

Formula 1 finally landed a new racing venue in the United States after roughly five years of effort from its owner Liberty Media.

Formula 1 will race the next decade in the Miami market after securing a venue and landing financial backers. And with the move, parent company Liberty Media‘s U.S. strategy is taking shape.

“Now things are coming together,” said Chris Lencheski, chairman of private equity consulting company Phoenicia.

“It’s going to be huge for the series, especially here in the United States,” added legendary motorsports driver Michael Andretti.

F1 agreed to a 10-year deal to bring a second race to the U.S. last weekend. Financials of the deal weren’t released, but motorsport insiders estimate F1 netted in the range of $17 million to $20 million per year under the pact. The Miami Grand Prix will join the U.S. Grand Prix in Austin, bringing four total races to North America as F1 also races in Canada and Mexico.

“The USA is a key growth market for us, and we are greatly encouraged by our growing reach in the US which will be further supported by this exciting second race,” said new F1 CEO Stefano Domenicali in a statement.

Lencheski credited former F1 CEO Chase Carey “for seeing this through” before relinquishing the role and taking a non-executive chairman title. He added Liberty Media would benefit as the race gives it access to a prominent South Florida market that favors top F1 automakers like Ferrari and Aston Martin.

But the next step in F1’s U.S. play could be essential.

“If I’m the CEO of Formula 1, I’m doing all I can to get an American driver in the seat and successful,” Lencheski added.

F1 could use help in the U.S.

Lencheski served as CEO of sports and entertainment marketing firm SKI & Company before selling the agency in 2008. The company formulated F1 sponsorships.

He said for F1 to market effectively market in the U.S., having a native driver would be critical in a sport fueled with nationalism, as it travels worldwide.

Currently, there are no American drivers in F1. Michael Andretti’s father, Mario Andretti, is the most successful American driver to dominate F1, winning the 1978 championship.

And Gene Haas’ F1 team is the only American team in F1 but has no American drivers, something U.S. drivers long ago noticed.

Pole position qualifier Lewis Hamilton of Great Britain and Mercedes GP looks on in parc ferme during qualifying ahead of the F1 Grand Prix of Emilia Romagna at Autodromo Enzo e Dino Ferrari on April 17, 2021 in Imola, Italy.

Mario Renzi | Formula 1 | Getty Images

United Kingdom native Lewis Hamilton is the most popular driver in F1. But Hamilton is 36, and the retirement chatter has started. He only signed a one-year deal to drive for Mercedes, further fueling speculation about his future.

“I don’t feel like I’m at the end but only in the next eight months or so I’ll find out whether I’m ready to stop or not. I don’t think I will, personally, but you never know,” Hamilton told F1’s website in March.

With Hamilton nearing the end, Lencheski nominated American IndyCar driver Colton Herta as a driver that could convert and thrive in F1 as a future star.

“He’s already proven he can win in IndyCar,” Lencheski said. “He’s won on the Formula 1 circuit in Austin. He’s lived in Europe training, and he’s the correct age.”

The Andrettis concurred.

Said Mario Andretti on Kyle Petty’s show: “As a young lad, his dad sent him to Europe, he was doing Formula 3, and he knows most of the circuits there, for one thing, and he’s trained. He’s showed in his rookie season in IndyCar, and he won some premium races like (in Austin) … beat two of the very best Indy has to offer. The entire race, he held off Will Power and Scott Dixon. This is one kid I’d love to see him get a break over there because to the U.S. colors again – Formula 1 is like the Olympics in a sense.”

Colton Herta waits on the award stand after winning the IndyCar Series auto race, at Mid-Ohio Sports Car Course, Sunday, Sept. 13, 2020, in Lexington, Ohio.

Phil Long | AP

Michael raced in the 1993 F1 World Championship series. He also praised F1 for building on their brand, which includes a streaming series to educate and generate new fans in the U.S.

“I think Liberty has done a lot of good things with the F1 series, including that Netflix show,” Andretti said. “That has done wonders for F1 and people understanding more what it’s about.”

Tracking the F1 stock 

Liberty, which also owns the Atlanta Braves, purchased F1 in 2016 for $4.4 billion, gaining access to a global fan base of over 400 million. It trades F1 as a tracking stock under the ticker “FWONA” on the Nasdaq. Tracking stocks are used by companies to track the success of a particular division in its portfolio.

With attendance restricted due to the pandemic, F1 revenue declined from $523 million to $485 million in 2020, according to its fourth-quarter earnings report. Liberty CEO Greg Maffei also linked the F1 stock to a $575 million special purpose acquisition company, searching for companies including digital media properties to take public.

A key metric on the report: There’s an average 87.4 million viewers per race. It’s a global stat, as over the years, F1 struggled in the U.S. market. F1 did not race in the U.S from 2008 to 2011 before returning with the U.S. Grand Prix in 2012 after a track was built in Austin. And part of Carey’s mission was to build on the U.S. market; hence, adding Miami and growing the media market.

ESPN returned F1 to its lineup in 2018 and pays the organization a rights fee though Comcast‘s Sky Group and F1 produce the races. It’s growing slowly on the viewership front.

The 2021 series opener, the Bahrain Grand Prix, saw an average of 879,000 viewers tune into the network’s ESPN2 channel on April 4. The second race in Italy attracted 905,000 average viewers, according to ESPN. And before the pandemic, F1 averaged 671,000 viewers in 2019 on ESPN channels, up from 554,000 viewers in 2018.

F1 could also be looking to expand on the media front, and Amazon could be in play, according to the Financial Times.

But F1’s future in Austin’s Circuit of the America is in question. The deal is set to expire after the 2021 season. The track sold out its 2019 race, missed 2020 due to the pandemic and is set to host this year’s event in October, part of a 23-race schedule.

Should it remain in Texas and thrive in Florida, Lencheski forecasted more U.S. expansion.

“If they bring an event to Las Vegas or the Pacific Northwest, it will sell out there, too,” he said.

F1 did not provide an official for this article after a CNBC request.

Teammate Mercedes AMG Petronas Motorsport driver Valtteri Bottas (77) of Finland pours champagne on the head of Mercedes AMG Petronas Motorsport driver Lewis Hamilton (44) of Great Britain after clinching the 2019 FIA Formula 1 World Championship following the F1 – U.S. Grand Prix race at Circuit of The Americas on November 3, 2019 in Austin, Texas.

Ken Murray | Icon Sportswire | Getty Images

F1 could get more competitive 

But whether the world’s top motorsport company will capitalize on the U.S. market is unclear. Michael Andretti said the newly installed salary cap would help balance the sport.

F1 established a new cost cap system, limiting teams’ spending. Think of it like the National Football League or National Basketball Association salary cap. For the 2021 season, it’s $145 million and fluctuating after the year. Hence, with a balanced field, bigger brand cars’ teams can’t outspend to win.

Michael Andretti, who himself is a part of a SPAC, Andretti Acquisition Corp., targeting the automotive industry, likes the cost cap system, believing smaller teams will benefit.

“They know how to deal with a smaller budget so they won’t have to downsize, whereas the bigger teams will need to learn how to downsize,” he said. “It’s going to be quite interesting to see what happens a couple of years down the road. I really believe the competition is going to get a lot better.”

“They should be very bullish about their future,” Michael added, “especially here in the U.S.”

Disclosure: Comcast is the parent company of NBCUniversal.

Source link

Continue Reading

Trending