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European automotive sector plans recovery

  • : Metals, Oil products
  • 20/05/06

The European automotive sector has proposed a plan to help restart the crippled industry after Covid-19 lockdown restrictions are eased, following closures amid the pandemic and new car sales all but vanishing in April.

EU-wide production losses since mid March, as a result of automotive factory shutdowns, have reached 2.3mn vehicles, according to the European Automobile Manufacturers' Association (ACEA).

New car sales have also fallen drastically. The UK automotive market in April experienced its worst ever month as the pandemic closed showrooms and dealerships across the country, causing new car sales to fall by 97.3pc on the year. New car sales in France fell by 88.8pc on the year in April and the Italian market fell by 97.5pc from last year.

The fall in automotive activity has impacted industries across Europe, with aluminium alloy producers closing alongside their automotive customers, while base oil demand has also been hit hard.

Targeting decision makers at EU and national levels, the industry's action plan has been signed by three other European associations alongside the ACEA, comprising the European Association of Automotive Suppliers, the European Tyre and Rubber Manufacturers Association and CECRA, an umbrella organisation regrouping national automotive trade associations and European brand dealer councils.

Among the plan's 25 suggested actions are calls to issue harmonised guidance on health and safety precautions for the workplace and an exemption on the transport of goods from border closures, as well as temporary flexibilities in competition rules, immediate renewal schemes for all vehicle categories across the EU and the postponement of all non-essential public consultations for at least two months.

"It is now crucial to bring the entire automotive value chain back into motion. We need a co-ordinated relaunch of industrial and retail activity, with maintained liquidity for businesses," ACEA director general Eric-Mark Huitema said. "Targeted measures will need to be taken to trigger demand and investment. Demand stimulus will boost the utilisation of our manufacturing capacity, safeguarding jobs and investments."


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24/11/05

Boeing workers approve contract, end strike: Update

Boeing workers approve contract, end strike: Update

Includes additional contract details in 3rd and 4th grafs, and background on Boeing. Houston, 5 November (Argus) — Union-backed machinists approved a new labor contract with aircraft manufacturer Boeing, ending a seven-week work stoppage that halted production of major jet programs and disrupted aerospace supply chains. More than 32,000 factory workers represented by the International Association of Machinists and Aerospace Workers (IAMAW) voted by 59pc to ratify the deal, the local union said late Monday. Employees secured a general wage increase (GWI) of 38pc spread out over the contract's four-year life, a one-time $12,000 ratification bonus and greater 401(k) contributions, among other retirement and health care benefits. The pay raise — a sticking point in prior rounds of negotiations — improved upon Boeing's first two offers of 25pc and 35pc but fell short of the 40pc sought by workers. Still, the union touted that the GWI in the new contract amounts to 43.65pc when compounded. Boeing chief executive Kelly Ortberg acknowledged the past few months "have been difficult" in expressing his appreciation that both sides were able to come to terms. Workers began their strike on 13 September, effectively shutting down Boeing's final assembly lines in Renton and Everett, Washington, where the company produces its flagship 737 MAX aircraft, along with its 767 and 777 programs. That stoppage further exacerbated issues within Boeing's operations that have been under heightened scrutiny since January, when a midair panel blowout led to a mandated production cap on the 737 MAX. Additionally, parts shortages and other supply chain challenges have constrained output of the company's main widebody program, the 787 Dreamliner, this year. The strike itself compelled Boeing to initiate cost-cutting measures with the production halt weighing on its finances . The company on 11 October announced it would lay off 10pc of its total workforce, while confirming on 23 October that it had stopped shipments from certain suppliers to conserve cash. The latest estimate from Anderson Economic Group, which does not account for last week, puts Boeing's losses at $5.5bn and its suppliers' losses at $2.3bn because of the work stoppage. All workers must return to their positions by 12 November but can return as early as Wednesday, the union said. Still, Boeing cautioned that it would take time for operations to stabilize, saying it would have to retrain and recertify employees who did not "get enough time on an airplane" before they went on strike. The company also will have to contend with a supply chain that it "turned off in many cases" because of the work stoppage. By Alex Nicoll Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Phillips 66 Calif shutdown to shift tanker flows


24/11/05
24/11/05

Phillips 66 Calif shutdown to shift tanker flows

Houston, 5 November (Argus) — Phillips 66's plans for a late 2025 shutdown of its 139,000 b/d refinery in Los Angeles, California, will likely lead to more trans-Pacific refined products tanker shipments into the US west coast while having a more muted effect on crude tankers. Phillips 66 said it would likely shut the refinery in the fourth quarter of 2025, citing the high regulatory costs of operating in California. While it is unclear what will become of the facility, Phillips 66 said it still plans to supply the region with road fuels in the future. The closure will reduce California's refining capacity by 8.6pc to about 1.48mn b/d and removes about 14pc of refining capacity in the Los Angeles area. Tankers hauled about 160,000 b/d of refined products to California in January-October, with about 95,000 b/d going to Los Angeles, according to data from analytics firm Vortexa. About 27pc of the deliveries to Los Angeles came from refiners on the US Gulf coast and elsewhere on the US west coast on Jones Act-compliant vessels, which must be US-built, US-flagged and US-crewed. But the relatively small Jones Act fleet is already fully utilized, with no additional ships on order, shipbroker Poten said. This means replacement supplies of refined products will need to come from farther afield, likely Asia-Pacific. South Korea is Los Angeles' biggest source of waterborne refined products so far this year, shipping about 33,000 b/d in January-October, Vortexa data show, followed by other US sources (25,000 b/d), China (9,000 b/d), India (9,000 b/d) and Canada (8,500 b/d). Taiwan, Singapore and Japan also have supplied marginal cargoes to Los Angeles this year. An increase of California-bound shipments from these countries would create additional demand for voyages lasting a range of 19-35 days, boosting ton-mile demand and tanker employment in the Pacific basin. Medium range (MR) and long range 1 (LR1) refined product tankers would benefit the most from these increased trade flows, with MRs accounting for 67pc of the current market share and LR1s 33pc, according to Vortexa data. Tanker demand for exports from the US west coast is unlikely to be affected. Phillips 66 Los Angeles exported just 2,000-4,000 b/d of products in January-October, data from Kpler and Vortexa show. Limited impact on crude tankers Because Phillips 66's Los Angeles refinery was designed to process domestic California crude, the impact on the regional crude tanker market likely will be much more limited — and offset by increased tanker demand on Canada's Pacific coast. With available domestic — albeit declining — California crude production, the 139,000 b/d refinery imported 64,000 b/d of crude in January-August 2024, mostly from short-haul sources in the Americas, the latest data from the US Energy Information Administration (EIA) show. The trade was dominated by 1mn bl Suezmaxes and 500,000-700,000 bl Aframaxes. The refinery imported 15.52mn bl of crude in January-August 2024, according to the EIA. Canada was the largest international supplier (4.84mn bl) in that span, boosted by the Trans Mountain Expansion (TMX) pipeline start-up in May, followed by Guyana (3.48mn bl) via the Trans-Panama Pipeline, Mexico (2.98mn bl), Brazil (2.92mn bl) and Ecuador (1.3mn bl). Because of the refinery's use of domestic crude supplies, the complex's imports are equivalent to just two Suezmax shipments or three Aframax shipments per month. For the regional tanker market, that is more than offset by the burgeoning TMX flows on Canada's Pacific coast, which in October loaded a record 24 Aframaxes , destined to refineries in China and the US west coast. By Tray Swanson Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

EU contributed $31.2bn public climate finance in 2024


24/11/05
24/11/05

EU contributed $31.2bn public climate finance in 2024

Edinburgh, 5 November (Argus) — The EU has contributed €28.6bn ($31.2bn) in climate finance from public sources in 2024 to help developing countries cut their greenhouse gas emissions (GHG) and adapt to climate change, according to the European Council. Around half the funding went to climate adaptation or to cross-cutting action, which involves both mitigation — reducing GHG emissions — and adaptation. Almost 50pc took the form of grants, according to the EU. The €28.6bn includes €3.2bn from the EU budget, including from the European Fund for Sustainable Development Plus, and €2.6bn from the European Investment Bank. The EU said it also mobilised €7.2bn of private finance last year, and it "seeks to extend the range and impact of sources and financial instruments and to mobilise more private finance". The figures were released ahead of the UN Cop 29 climate talks, which open on 11 November in Baku, Azerbaijan. Finance will be a key topic at this year's summit as parties to the Paris deal will seek to agree on a new finance goal for developing nations, following on from the current, but broadly recognised as inadequate, $100bn/yr target. EU negotiators have signalled willingness to support "a stretched goal" with a public finance core, but have yet to provide a figure. Developed countries in general have yet to commit to a number for climate finance, while developing nations have for some time called for a floor of at least $1 trillion/yr. By Caroline Varin Europe's contribution to climate finance €bn Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Boeing workers approve contract, end strike


24/11/05
24/11/05

Boeing workers approve contract, end strike

Houston, 5 November (Argus) — Union-backed machinists approved a new labor contract with aircraft manufacturer Boeing, ending a seven-week strike that halted production of major jet programs and disrupted aerospace supply chains. More than 32,000 factory workers represented by the International Association of Machinists and Aerospace Workers voted by 59pc to ratify the deal, the local union said late Monday. Employees secured a general wage increase of 38pc spread out over four years and a $12,000 ratification bonus, along with other retirement and health care benefits. All workers must return to their positions by 12 November but can return as early as Wednesday, the union said. By Alex Nicoll Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

US railroad-labor contract talks heat up


24/11/04
24/11/04

US railroad-labor contract talks heat up

Washington, 4 November (Argus) — Negotiations to amend US rail labor contracts are becoming increasingly complicated as railroads split on negotiating tactics, potentially stalling operations at some carriers. The multiple negotiating pathways are reigniting fears of 2022, when some unions agreed to new contracts and others were on the verge of striking before President Joe Biden ordered them back to work . Shippers feared freight delays if strikes occurred. This round, two railroads are independently negotiating with unions. Most of the Class I railroads have traditionally used the National Carriers' Conference Committee to jointly negotiate contracts with the nation's largest labor unions. Eastern railroad CSX has already reached agreements with labor unions representing 17 job categories, which combined represent nearly 60pc of its unionized workforce. "This is the right approach for CSX," chief executive Joe Hinrichs said last month. Getting the national agreements on wages and benefits done will then let CSX work with employees on efficiency, safety and other issues, he said. Western carrier Union Pacific is taking a similar path. "We look forward to negotiating a deal that improves operating efficiency, helps provide the service we sold to our customers" and enables the railroad to thrive, it said. Some talks may be tough. The Brotherhood of Locomotive Engineers and Trainmen (BLET) and Union Pacific are in court over their most recent agreement. But BLET is meeting with Union Pacific chief executive Jim Vena next week, and with CSX officials the following week. Traditional group negotiation is also proceeding. BNSF, Norfolk Southern and the US arm of Canadian National last week initiated talks under the National Carriers' Conference Committee to amend existing contracts with 12 unions. Under the Railway Labor Act, rail labor contracts do not expire, a regulation designed to keep freight moving. But if railroads and unions again go months without reaching agreements, freight movements will again be at risk. By Abby Caplan Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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