Ford Motor Co. plans to produce a future electric car in Mexico rather than make it in the U.S., reversing plans announced in January to make its Flat Rock, Mich., assembly plant near Detroit its main electric-vehicle production site.
A New York hedge fund that earlier this year flipped the board of Depomed Inc. and installed a new CEO to boost the company’s value said Monday that it will cut 40 percent of its staff and move the drug company’s headquarters out of California.
The move is necessary, Newark-based Depomed (NASDAQ: DEPO) said in a Securities and Exchange Commission filing, because it is turning over sales of its pain drug Nucynta to Collegium Pharmaceutical Inc. and won’t need as large of a workforce or space.
Aerospace employment in Los Angeles County dropped by 3,000 jobs, or about 6 percent, to 51,000 between 2014 and 2016, according to a report released Monday from the Los Angeles County Economic Development Corp.
Most of the job losses were in aircraft manufacturing, which fell by 2,200, due in part to the closing of Boeing Co.’s Long Beach plant which built the C-17 Globemaster III cargo plane. That resulted in about 400 layoffs at the end of 2015, according to news stories.
The aerospace job losses were partially offset by a gain of 500 jobs in aircraft parts, engines and guided missiles, as well as space vehicles, due to the expansion of Space Exploration Technologies Corp. in Hawthorne.
No car company outside China makes batteries for their electric cars. Investors should hope it stays that way.
Japanese group Panasonic makes the battery cells in Tesla’s much-hyped “gigafactory” in Nevada. Other global car makers also outsource production of cells to East Asian specialists, even if they assemble them into battery packs in their own plants. Mercedes-owner Daimler is plowing $1.2 billion into what it calls “battery factories” in Germany, China and Tuscaloosa, Alabama, but these too will buy cells from others.
Wedged between iron and nickel on the periodic table, cobalt has suddenly emerged as the electric car killer. The once-obscure metal, a critical part of batteries, has nearly tripled in price since last summer as concerns grow about whether there will be enough cobalt to meet demand. The ingredients are certainly there for a shortage. Output is concentrated in the politically unstable Democratic Republic of Congo and refining is dominated by China. Demand is set to soar as companies from Tesla Inc. to Volkswagen AG ramp up production of electric vehicles.
“The storage battery is, in my opinion, a catchpenny, a sensation, a mechanism for swindling the public by stock companies,” wrote Thomas Edison in 1883.
Today, the battery industry is mustering for exponential growth as car makers electrify their fleets, most visibly at Tesla ’s $5 billion factory in Nevada. For investors looking to gain from the battery’s rise, though, the doubts of the 19th-century entrepreneur linger. The path to profitability is far from clear.
The decline in the U.S. industrial base over the past couple of decades is the main factor eroding the share of American national income that goes to middle-class workers, according to consultants at McKinsey & Co.
For decades, labor’s share of gross domestic product has shrunk—while the share that goes to capital like profits, interest and rent, has risen. The McKinsey Global Institute, the firm’s research arm, finds that manufacturing accounts for more than two-thirds of the overall decline in labor’s share of gross domestic product since 1990. That, in turn, has harmed the prospects of the middle class and widened income inequality.
Luxury electric carmaker Tesla this week acquired a small, Minnesota-based factory automation company, in hopes of fixing unexpected bottlenecks on its Model 3 production line. Perbix launched in 1976 and employs 150 people in a suburb north of Minneapolis. Tesla said it’s worked with the engineering firm for nearly three years, on a number of projects on the production line at its Fremont car factory and its Gigafactory in Reno. Terms of the deal were not immediately released.
Electric-car maker Tesla has reached an agreement to set up its own manufacturing facility in Shanghai, according to people briefed on the plan, a move that could help it gain traction in China’s fast-growing market for electric vehicles.
The deal with Shanghai’s government will allow the Silicon Valley auto maker to build a wholly owned factory in the city’s free-trade zone, these people said. This arrangement, the first of its kind for a foreign auto maker, could enable Tesla to slash production costs, but it would still likely incur China’s 25% import tariff.
Tesla confirmed Friday afternoon that it has laid off hundreds of employees this week following reports that the company had cut somewhere between 300 and 700 jobs.
The job cuts come as the Palo Alto-based electric car company ramps up manufacturing for its moderately priced Model 3. CEO Elon Musk last week said the company was delaying the unveiling of its all-electric semi truck as Model 3 production hit assembly-line snags.
The layoffs were not part of structured reductions but as a result of company-wide annual reviews, a Tesla spokesperson said in a statement to the Silicon Valley Business Journal on Friday afternoon. As part of the review process, some workers received promotions and bonuses, she said, and the company is continuing to hire.
Following Ford’s announcement that it would shift more resources to electric cars, the United Auto Workers has begun talks with the automaker about the potential impact of more electric-car production on jobs.
. . . In a presentation to investors earlier this week, Ford CEO Jim Hackett said electric cars will reduce “hours to build” by 30 percent compared to internal-combustion models. If a car takes less time to build, the carmaker won’t need as many workers. Settles said he has met one-on-one with Hackett to discuss the issue.
U.S. factory activity surged to a more than 13-year high in September amid strong gains in new orders and raw material prices, pointing to underlying strength in the economy even as Hurricanes Harvey and Irma are expected to dent growth in the third quarter.
The economic outlook was also bolstered by other data on Monday showing a rebound in construction spending in August. The acceleration in manufacturing activity and the accompanying increase in prices could harden expectations that the Federal Reserve will raise interest rates in December.
The Institute for Supply Management (ISM) said its index of national factory activity surged to a reading of 60.8 last month, the highest reading since May 2004, from 58.8 in August.
The reported cuts would dwarf the 600 layoffs the firm reported last year to California authorities, and would eliminate some 5,000 employees — 10 percent of its workforce, the report said.
“The cuts at the company, which has about 50,000 workers, are likely to affect workers in the U.S. and abroad, including managers,” Bloomberg reported, based on unnamed sources.
California Democrats have finally found a cause that’s worth suspending their environmental passions. The United Automobile Workers are struggling for a presence in Tesla’s Fremont plant, and organized labor has called in a political favor.
Since 2010 California has offered a $2,500 rebate to encourage consumers to buy electric vehicles. But last week, at unions’ behest, Democrats introduced an amendment to cap-and-trade spending legislation that would require participating manufacturers to get a sign-off from the state labor secretary verifying that they are “fair and responsible in their treatment of workers.”
San Mateo-based SolarCity Corp. and its parent, Tesla Inc., plan to lay off more than 200 employees at their Roseville offices, part of continuing restructuring in the aftermath of Tesla’s acquisition of SolarCity last fall.