Millennials are being squeezed out of the world's middle class as incomes stagnate and costs rise, according to research by the Organization for Economic Co-operation and Development (OECD).
In a report published Wednesday, the 36-nation intergovernmental economic body said younger people were struggling to make it into that bracket, while those who were already included were finding it difficult to maintain their position. It said it was due to deteriorating income growth coupled with increasing costs of housing and education.
According to the report, 60% of millennials across the 40 countries surveyed were categorized as middle income. In contrast, 68% of "baby boomers" — those born between 1942 and 1964 — were middle class. Breaking it down further, only 53% of millennials in the U.S. were middle class, the data showed. Just 59% of British millennials made it in, compared to 69% in Japan and 66% in Australia.
The report said middle incomes rose by just 0.3% per year over the past decade, but noted that housing is now the single largest spending item for middle-income households, taking up around one-third of disposable income — which is up 25% since the 1990s.
The OECD defined middle class as those who earned between 75% and 200% of the median national income. Across the 40 countries included in its study, 61% of the population qualified as middle class.
Under the OECD's definition, 51% of the U.S. population fell into the middle class category — putting it behind most other OECD members. China, meanwhile, had a middle class rate of 48%.
"Today the middle class looks increasingly like a boat in rocky waters," said OECD Secretary General Angel Gurria. "Governments must listen to people's concerns and protect and promote middle class living standards. This will help drive inclusive and sustainable growth and create a more cohesive and stable social fabric."
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China's Liu He will have dinner with Trump trade negotiators hours before tariff hike takes effect5/9/2019
Liu He, China's vice premier and top trade negotiator, will have dinner with President Donald Trump's trade team Thursday evening in Washington, just hours before the U.S. will hike tariffs on $200 billion in Chinese goods.
Liu will dine with U.S. Trade Representative Robert Lighthizer and other U.S. officials as the world's two largest economies try to salvage a trade deal, White House press secretary Sarah Huckabee Sanders said. Liu is not expected to meet with President Donald Trump on Thursday. Markets will be watching for any clues or updates to leak out of the dinner. U.S. stock futures open at 6 p.m. ET. Stocks declined at the opening bell Thursday morning after Trump said during a Wednesday night campaign rally that China "broke the deal."
Investors have followed the talks closely as they hope the U.S. and China can avoid widening their trade conflict and damaging the global economy. Asked whether the White House — which closely watches financial markets — is prepared for the market reaction Friday if no deal takes shape, Sanders responded: "We're always prepared."
The U.S. has officially filed paperwork to raise duties on the Chinese products to 25% from 10% at 12:01 a.m. ET on Friday. While the Trump administration said it could reverse its decision if the sides make progress during talks Thursday, it is unclear whether Washington and Beijing can move close enough to a deal.
Trump first announced the tariff increase on Sunday as the U.S. accused China of reneging on key parts of the developing trade deal. Trump claimed Wednesday that China "broke the deal." The Chinese side reportedly felt Trump may be willing to make concessions, according to The Wall Street Journal.
Trump has pushed for an agreement to address grievances with China such as intellectual property theft, forced technology transfers and trade deficits. The Trump administration has already placed tariffs on $250 billion in Chinese goods and has threatened to levy duties on more products as it tries to bring Beijing to the table.
Insurance firms are facing increasing competitive pressure on all fronts due to the emergence of a number of insurance technology (insurtech) start-ups, according to a report.
With the integration of technologies like artificial intelligence, blockchain and drones entering the insurance mix, the sector is being forced to rethink its model.
The World Insurance Report, published Wednesday by consulting giant Capgemini and non-profit industry body Efma, found that nearly one third (31.4%) of customers relied on insurtech solutions - either exclusively or in combination with an established insurance company.
"Customers are seeking more digital touch points for convenience, as customers experience in their daily lives that degree of personalization," Keith Webb, vice president at Capgemini and co-author of the report, told CNBC via phone call Tuesday. "And the insurance industry can't actually lag behind, although I think that it still is lagging behind other sectors. But certainly it's waking up to the fact that working in partnership with more insurtech firms - working in partnership with technology firms generally - through their innovation labs now which are fairly common, is definitely enabling more rapid, and more innovative engagement models with customers, that take them into that personalization stage that really customers are beginning to expect." There are several accelerator programs such as the U.K.'s Startupbootcamp and Germany's Allianz X (part of the Allianz group) which mentor insurtech businesses and help them scale up.
Insurtech, an offshoot of the financial technology (fintech) sector, is a rapidly evolving movement aimed at simplifying and improving the efficiency of insurance.
But the report also found that more traditional insurance channels still found favor with many consumers. Out of the 8,000 consumers surveyed by Capgemini and Efma, 46 percent said mainstream insurance firms performed better than insurtech vendors at security and fraud protection, while 44 percent said they performed better than insurtechs at brand awareness. Trust was also relatively low as a whole for the industry. Although mainstream insurance businesses again topped insurtech in this regard, with 40 percent of customers saying they trusted their insurers, and only 26 percent saying the same of insurtechs. Capgemini's Webb said that incumbents (established insurance firms) tended to have better customer relationships and financial capital than insurtechs. "The factor though that is a drag on customers is the fact that the incumbents currently do have very strong balance sheets, they have been regulated, their brands are well known, there is a degree of trust that they still have - all of those are major assets," he said. Last week, accounting giant EY said it planned to launch the first blockchain platform for the marine insurance sector, in collaboration with Microsoft, A.P Moller-Maersk and other companies.
But he added: "I think that drives them towards working much more through this whole collaboration. I think the model is increasingly moving to want more and more collaboration."
Consensus on industry-wide collaboration The conclusion of the report pointed towards more collaborative efforts rather than direct competition to improve the efficiency of the sector. The vast majority (75%) of senior insurance executives interviewed by the two organizations said that developing their own insurtech capabilities would help them meet demand. Webb added that, despite the fact that insurtech start-ups struggled to make their long-term business both scalable and sustainable, they have still been "majorly disruptive". "I think the insurtechs have been majorly disruptive, because when they do come in with their new models, they have a different pricing structure, as well as different experience. So I think when they come into play, they're highly disruptive on the industry," he said. He added: "The market is maturing to realize that it's both the innovation and the challenge the insurtechs bring - the bravery if you like to exploit some of the emerging technologies - with the more mature firms with established customer bases. And bringing them together seems to be the optimal combination."
According to the report, AI, blockchain and drones were among the driving factors of the "insurtech revolution".
"The continued reliance of consumers on digital technologies that support mobile apps, social networking, on-demand services and the like makes it clear that the mass market has entered a new phase," Vincent Bastid, secretary general at Efma, said in a press statement Wednesday. "The insurance industry serves the masses and must adapt to the new terms of engagement. Collaborating with insurtechs is an optimal way of incubating and accelerating digital innovation." Drones, analytics could have role to play in disaster relief Report author Webb said that insurtech could have a role to play in reducing the losses caused by disasters such as Hurricane Irma. "I think there's the possibility of insurance playing increasingly, especially in these kinds of disasters, a more proactive, value-adding community societal system," he said. Losses forecast by risk modelling firm AIR Worldwide were initially estimated to total up to $65 billion. This projection has since been reduced to $20-40 billion.
Webb said that the knowledge of which areas Hurricane Irma was going to impact could have been combined with drones and analytics to reduce risk to the industry.
"The ability therefore to fly over those areas before it hits, and then fly over them after Irma's gone - it's fairly devastational, I accept that - but the ability then to use those and basically be proactive in finding and getting compensation and getting relief is very plausible, but probably has not been done," he said. Webb added that the availability of such technology was present, but "not quite (being) deployed yet". CNBC
David Krauss had parlayed his Dallas condo into a successful Airbnb listing until one fateful weekend in 2014. Then, a couple of guests threw a party so loud it elicited more than a dozen noise complaints from neighbors, a police report and an angry letter from an attorney.
His reputation in the building was so sullied he decided it was best to sell the unit – at a US$30,000 loss. But Krauss, a former independent real estate developer, wasn’t finished with Airbnb.
His misfortune gave way to an idea for a device – "a smoke detector for noise" – that sends alerts directly to hosts’ phones when guests get too loud for too long. That way owners can intervene well before neighbors are disrupted or worse, the police are called.
His company, NoiseAware, is just one of hundreds of startups that are riding the coattails of the home-share titan and its rivals, which include Booking Holdings Inc and Expedia Group Inc’s HomeAway, as demand for such rentals skyrockets. Over the past decade, Airbnb Inc has transformed the travel sector by persuading millions of people to open up their homes to complete strangers. As the company grew, amassing more than six million listings in about 191 countries, it has spawned a whole ecosystem of startups that seek a piece of the booming market for private accommodations by helping to fill in the gaps that Airbnb and the others can’t or don’t address, like automating the check-in process and providing keyless entry around the clock.
Some sell software that promises to calculate the perfect listing price or updates a property’s availability instantly. One company helps owners decorate –from furniture to bedding – to create that unique vacation-rental-unit vibe.
"Everybody is sort of trying to solve a pain point," said Simon Lehmann, who has worked in the travel industry and now runs AJL Consulting GmbH. "We have seen a massive amount of startups in this industry, massive verticalisation, lots of money pouring in." Since 2008, investors have poured about US$14.6bil into digital travel startups, excluding the funding that went to Airbnb, according to a 2018 report by Phocuswright, which counts data through the first half of last year. The travel research company has identified almost 1,800 startups in the industry. Airbnb has evolved considerably since its founders famously rented out air mattresses on the floor of their San Francisco apartment in 2007. While millions of people have benefitted from making extra cash by sharing their home or enjoying a more intimate experience when traveling to a new destination, the so-called alternative accommodations market suddenly isn’t so alternative. It’s big business. Booking has almost as many vacation home listings as Airbnb and even Google has gotten into the game, offering rentals from Expedia’s VRBO and HomeAway, among others. The world’s largest hotel company, Marriott International Inc, is also expanding in the home-sharing business, bringing its own offerings to the US later this spring after already operating in a handful of European cities.
People "started to realise that it’s actually not that easy to be a property manager – handing over keys at three o’clock in the morning, answering complaints from the guest and making sure the guest’s experience is absolutely at its best," Lehmann said. "So the business is getting more managed."
Lehmann estimates that now there's an even split between private owners and managed owners, or those who oversee more than two properties and often more than 20, making it their full-time job. The trend is continuing toward more managed inventory, with the share of rentals by owners decreasing, Lehmann said. "Vacation rentals have been around forever, but they were always a little bit sleepy and a lot of the online distribution was kind of like bulletin boards," said Seth Borko, a senior research analyst at Skift, a travel intelligence platform. "Airbnb has really changed all that.’’ Such growth has created opportunities for other startups, too. Fulhaus Inc designs and furnishes units for professional vacation rental owners. Its Haus-in-a-Box' product offers a "complete furniture package specifically designed for the short-term rental market’’ and comes in several styles – including paradise, corporate and luxe – and includes a platform to let guests buy the items they like. Another platform, Operto, connects properties to a range of devices – including NoiseAware, digital locks, smart thermostats, lights and even carbon dioxide monitors that can help hosts calculate how many people are in a unit. Properly, one of several companies Lehmann has invested in, offers a platform for managing the cleaning, maintenance and other tasks required for preparing a unit before the next guest arrives. More than 60,000 properties are connected to the service, which also allows hosts and service providers to communicate about supplies that are running low, and damage left behind by guests.
Customers are expecting much higher quality in their alternative accommodations, even in "the treehouse, the houseboat, whatever it might be," said Properly founder and CEO Alex Nigg. Guests want at least the clean white sheets that they expect at the hotel, and of course, the 24/7 check-in.
As Airbnb, last valued at more than US$30bil (RM124bil), eyes an initial public offering next year, it’s also working to pivot its home-share service into a comprehensive travel platform, where vacationers can book flights, accommodations and tourist experiences. Partnering with a growing network of startups is one of the levers Airbnb plans to pull in order to succeed, said Chris Lehane, Airbnb’s global head of policy. It’s a "win, win, win for those plugged into the ecosystem." NoiseAware’s Krauss definitely sees it that way. Despite the "mini-Coachella" party that cost him his condo, Krauss has become one of Airbnb’s "superhosts’’ and was honored at the company’s headquarters recently. He has hosted more than 5,000 guests. "My life has been way more committed to this concept of short-term rentals and Airbnb than I even knew," he said. Bloomberg PHOENIX: When Chris Williamson was in the market for a new family car, a timely ad and conversations with a co-worker convinced him to try something out of the ordinary. He bought a BMW 3 Series convertible and covers the payments by renting it to strangers on a peer-to-peer car sharing app called Turo. It allows his family of seven to have a nicer car, essentially for free. “It’s great to have that little bit of extra income and not have to worry about the car payments,” said Williamson, a teacher from the Phoenix area. But his customers and others using car-sharing apps around the United States get their rentals tax-free. That’s made them a target for rental car companies, airport authorities and local governments. They say users of the upstart apps should pay the same taxes and fees that come with traditional rental cars. At stake is hundreds of millions of dollars in revenue that cities and airports count on to pay for stadiums and convention centres or to fund police, fire and other general operations. “These companies are very sophisticated, technology-savvy companies that have hundreds of millions of dollars invested in each of them,” said Ray Wagner, senior vice president for government relations at Enterprise Holdings, parent of the nation’s largest car-rental firm. “They should be expected to comply with the same rules as a small, mom and pop rental car company located in rural Arizona.” Turo says Enterprise is trying to stifle competition. Car-sharing companies including Turo and GetAround function like Airbnb for vehicles, allowing people to rent out their cars when they’re not using them. Founded about a decade ago, they’ve taken off recently with the help of millions of dollars from venture capital firms and other investors. That’s put them in conflict with the US$42bil-per-year rental car industry and the tourism and government agencies that tax it and regulate safety and consumer protections. The battle is heating up in some three dozen state legislatures as well as the courts and offices of local tax authorities. Barraged with lobbying from both sides, lawmakers are grappling with how to regulate an emerging industry without destroying it – a repeat of recent fights between the taxi industry and Uber and Lyft, and between hotels and Airbnb. “The tragedy would be if we snuffed out something like this in its infancy that has a lot of great potential,” said Arizona Rep. Travis Grantham, a Republican who has introduced legislation backed by Turo that would exempt car-sharing from all rental car taxes except the standard sales taxes. Tourism taxes have long been popular with politicians who can use surcharges on hotel rooms and rental cars – paid largely by visitors who vote elsewhere – to raise money for local priorities. Forty-four US states levy excise taxes on rental cars – on top of the standard sales tax, if one applies – and most allow local governments to levy their own as well, according to a March study by the Tax Foundation, a conservative think tank. Airports often add surcharges to pay for sprawling rental-car facilities. Taxes, fees and surcharges can add as much as 30% to the cost of renting a car while generating millions of dollars. In metropolitan Phoenix, the baseball league that draws fans to 10 stadiums for spring training every March could see a sharp decrease in revenue as the new platform for car rental grows, said its president, Jeff Meyer. Rental car taxes help cover debt payments for some of the Cactus League’s facilities and for the Arizona Cardinals football stadium. California, Oregon and Washington passed legislation on car-sharing years before the industry took off, and Maryland did so last year. Bills governing the practice have been introduced in more than 30 other states, with the fight especially contentious in Alaska, Arizona, Colorado, Florida, Illinois, New Mexico and Ohio. Turo also is fighting in court with Los Angeles and San Francisco airport authorities, which contend the company should pay fees. Meanwhile, Chicago tax authorities wrote that car-sharing is subject to rental car taxes in response to questions from an Enterprise lawyer, according to a letter provided by the company. In Arizona, Enterprise is backing legislation that would tax car-sharing like rental cars and require them to enter agreements with airports to use their facilities, while Turo supports a proposal that would exempt car-sharing companies from most taxes. In Ohio, a detailed package of new regulations on car-sharing companies was tucked into the House version of the state transportation budget. It came as the Columbus Regional Airport Authority broke ground on a new US$140mil car rental facility that relies on a steady stream of car rental user fees. The peer-to-peer companies won a temporary reprieve last month, when the provision was dropped from the bill. But Ohio Sen. Bob Peterson, the No. 2 Republican, said he anticipates a stand-alone regulatory bill will be introduced soon. “I think everybody was agreed this is a new industry that needs some more regulation,” Peterson said. Both sides portray their position as a matter of fairness. Those supporting stricter regulations say people who rent out their cars for profit should not only pay the taxes but meet the safety and transparency requirements that go with renting a car.
“The goal is levelling the playing field,” said Arizona Rep. David Livingston, a Republican who is sponsoring legislation to treat car-sharing firms like rental car companies. “You want all these companies operating with the same type of rules and regulations so they can compete and the best one wins, whoever that is.” Turo’s lobbyists point to the billions of dollars car-rental firms save on taxes. Most states charge no sales tax for vehicles sold exclusively for rental, and allow those companies to pass along vehicle licensing fees to customers. Turo asks why its users should pay rental taxes if they’re not exempt from other vehicle taxes that benefit rental car companies. “Our host community is individuals that are just trying to offset the cost of a car,” said Steve Webb, the company’s vice-president of communications. “And Enterprise is this US$24bil Goliath that is using their political connections to stifle innovation.” Turo says more than 95% of Turo’s 197,000 “hosts” share three or fewer cars on the platform. But some of the company’s 350,000 listed vehicles are owned by people who rent out small fleets. Wagner, the Enterprise executive, calls it a “politically motivated fiction” for Turo to focus on taxes paid by people who occasionally list their car. For Williamson, the Phoenix teacher who rents his BMW through Turo, the prospect of his customers having to take on those taxes and surcharges is concerning. The people who rent his BMW are looking to splurge. He also sometimes rents his family’s Honda Pilot SUV. “Any time you start to creep the price up for anything, you’re going to get people who say, `Oh, I guess we won’t take the convertible this weekend. We’ll just take whatever Hertz has on special’,” he said. – AP
WELLINGTON: New Zealand’s central bank cut interest rates to a fresh record low and signaled the chance of one further reduction amid slowing global growth and weak inflation.
“The Monetary Policy Committee decided a lower OCR is necessary to support the outlook for employment and inflation,” the Reserve Bank said after lowering the official cash rate a quarter of a percentage point to 1.5 percent.
“A lower OCR now is most consistent with achieving our objectives and provides a more balanced outlook for interest rates.” The RBNZ becomes the first central bank in the developed world to begin loosening policy this cycle, which should exert downward pressure on the New Zealand dollar and boost the inflation outlook. In late March, Governor Adrian Orr said the more likely direction of the next OCR move was down and since then economic data have been softer than expected. The inflation rate fell to 1.5 percent in the first quarter and hiring declined. New Zealand’s dollar fell after the report. It bought 65.80 U.S. cents at 2:44 p.m. in Wellington from 66.02 cents immediately before the statement. Two-year swap rates fell 8 basis points to a record-low 1.56 percent. The RBNZ’s projections today signal that another rate cut is possible. They show the average OCR dropping to 1.48 percent by the end of this year and 1.36 percent by the third quarter of 2020. The benchmark rate had been at 1.75 percent since November 2016. The forecasts imply around a 50 percent probability of another cut, said Nick Tuffley, chief economist at ASB Bank in Auckland. “The next move in the OCR will likely be data dependent; we have penciled in August but feel the risks are skewed to a later move,’’ he said. “The RBNZ’s current OCR outlook suggests a measured assessment before a further cut, rather than a sense of urgency.’’
New Committee
While 14 of 20 economists surveyed by Bloomberg expected today’s move, market pricing of a cut dropped to less than 40 percent in the hours before the announcement. Today’s decision was the first made by an enlarged policy committee comprised of four internal and three external members plus a non-voting Treasury observer. The decision was reached by consensus, according to a record of the meeting published Wednesday. New Zealand’s economy has cooled, with annual growth slowing to 2.3 percent last year from 3.4 percent in 2017. Subdued business confidence and renewed fears of the impact of a trade war between the U.S. and China on global growth are clouding the near-term outlook. Forecasts Cut The RBNZ today cut its forecasts for economic growth, saying it now expects gross domestic product to increase 2.2 percent in the year through March 2019 compared to 2.9 percent previously. It sees growth rebounding to 3.2 percent in 2020. “Domestic growth slowed from the second half of 2018,” the RBNZ said. “Reduced population growth through lower net immigration, and continuing house price softness in some areas, has tempered the growth in household spending. Ongoing low business sentiment, tighter profit margins, and competition for resources has restrained investment.” The central bank also increased its near-term forecasts for inflation, saying it now expects prices to rise 1.6 percent in 2019 compared to 1.4 percent previously. Still, inflation is not expected to reach 2 percent -- the midpoint of the central bank’s target range -- until the second quarter of 2021, which is six months later than previously projected. “Inflationary pressure is projected to rise only slowly,” the RBNZ said, noting a more subdued outlook for employment growth. - Bloomberg
SAN FRANCISCO/ CAPE TOWN: Uber co-founder and former CEO Travis Kalanick used to tell investors he liked to keep his company teetering between order and chaos.
By the time he left, it was chaos. The company was battered by a slew of scandals, including revelations it had used illicit tactics to handicap competitors and dodge regulators.
Almost two years later, under new leadership and set to debut May 10 on Wall Street in the largest US public stock offering since 2014, Uber Technologies Inc is still testing the rule of law.
With growth slowing, the company continues to spar with local officials around the world looking to limit Uber cars on their streets. In Cape Town, South Africa, for example, Uber dominates the market with an estimated 7,000 drivers, most of whom are operating illegally, according to city officials. Uber blames Cape Town's "broken" system for approving ride-hailing licenses.
In the United States, Uber has used the courts to try to block what it see as unreasonable restrictions on its business. And it has successfully lobbied state legislatures to pass laws preempting local ride-hailing regulations, much to the frustration of officials in some cities where it operates.
Uber insiders say CEO Dara Khosrowshahi has made strides in cleaning up a frat-house culture that spawned allegations of sexual harassment and embarrassing leaks of executives behaving badly. But Uber's sharp-elbowed business tactics, detailed by lawmakers, city staff and regulators across the globe, as well as drivers and former employees, continue to drive the company. "It's in the DNA," a former Uber manager said. "Old habits die hard." Whether its playbook delivers the growth and profitability public market investors will be seeking remains to be seen. Revenue growth slowed to 2.3% in the fourth quarter over the previous quarter, a worrisome sign for a business that lost more than US$3bil last year.
Uber's economics "are not immediately or obviously attractive for sustainable, long-term investment", Mark Hargraves, Head of Framlington Global Equities at AXA Investment Managers, said in a recent note to clients.
An Uber spokesman declined to comment. In its IPO filing, the company said it is "using a proactive and collaborative approach with regulators" and "rebuilding and strengthening" its relationships with cities. Where ride-hailing is banned, Uber is instead offering e-bike services or partnering with traditional taxi companies. Still the company acknowledged "legal and regulatory obstacles" around the world that could impede its revenue and growth. Cat and mouse in Cape Town Thousands of miles from Wall Street, Uber is pushing the bounds of regulation. In Chile, which has yet to work out a regulatory framework for ridesharing, Uber drivers have been known to enlist passengers to help them evade transit cops. In Mexico City, Uber has protested new safety rules it says would limit the number of riders who could use the app. In London, Uber is on probation after it was temporarily banned for flouting safety rules.
And in Cape Town, Uber has entered its fifth year of a stalemate with local officials.
Every ride-hailing service in Cape Town is allotted a certain number of operating licenses for its drivers. As of mid-April, Western Cape Province, where the city is located, had approved 760 such licenses for Uber. But the city estimates there are roughly 10 times that many Uber drivers plying its streets, many of them immigrants or refugees. Foreign-born drivers must also have work permits, paperwork many of them lack, according to city aldermen and drivers. Uber said it allows drivers to start work while their ride-hailing licenses are still pending approval but that the company thoroughly vets the drivers. A game of cat and mouse has ensued: drivers alert each other to the whereabouts of traffic cops through the WhatsApp mobile messaging service. If their cars are impounded, they pay the fines, start driving anew and wait for Uber to reimburse them. Those impound fines start at almost US$500 and go up with each subsequent offense, topping out at more than US$1,000. Drivers are fined an additional US$173 each time.
"It's just like gangsterism fighting for turf," said Ivan, a South African driver who gave only his first name.
Uber has spent at least US$2.3mil since 2016 to reimburse drivers for the impound fines, according to Reuters' estimate based on data from the city. Uber declined to say how much it had spent, but said it would continue paying the fines to support its drivers and get them back on the road. South Africa is crucial to Uber's Africa strategy, boasting the continent's most-developed economy. A spokesperson for Uber South Africa said Cape Town's licensing system "is effectively broken" and blamed the city for what it says is a backlog that can stretch for more than two years in some cases. The city estimates there is a market for about 2,100 Uber drivers. Alderman JP Smith said part of Cape Town's calculus is to head off violence that could result if too many taxi drivers are put out of business by new ride-hailing rivals. In the larger cities of Pretoria and Johannesburg, some Uber drivers and cabbies have been killed and their cars torched as part of an ongoing turf war. "In other parts of the world, if there are too many taxis some just stop being taxis," Smith said. "Here, disputes between taxis are settled via assassination and murder." The face-off may not find a resolution any time soon. Cape Town is expanding its impound facilities so it can take in nearly twice the number of cars.
Bad blood
Big cities concerned about gridlock, air quality and the safety of passengers and drivers are crafting new policies and demanding more data from ride-hailing companies to find solutions. Uber is pushing back. The company sued New York City in February over a law imposing a cap on the number of ride-hailing drivers, a move taken to address worsening traffic. In its hometown of San Francisco, Uber is fighting a court order to turn over data the city says would help improve traffic management and the safety of Uber drivers. As city officials in the United States have gotten scrappier, Uber has sought out friendlier state legislators to work around them. Over just four years, Uber and rival Lyft helped pass laws in 41 states that put ride-hailing under the state's jurisdiction, preempting some or all local regulations, according to a 2018 study by the National Employment Law Project. Uber is now pushing legislation in Oregon that would preempt local mandates on driver caps, permits, data collection and access for passengers in wheelchairs, among others.
Uber's general manager for Oregon said the bill would create "increased mobility for rural and urban communities", by bringing Uber to towns that currently do not allow it.
Officials in Portland say their city is in the crosshairs. After Uber launched there in late 2014, Portland sued to stop its operation, declaring it illegal. That suit was later dropped, but Portland regulates Uber closely. Noah Siegel, interim assistant director at the Portland Bureau of Transportation, said the proposed legislation would hurt the city's ability to manage growth and ensure everyone can get around safely. "We were not really holding a lot of bad blood about what had happened" with Uber in the past, Siegel said. "But this bill serves as a reference point that it's only been four years and they still haven't turned a profit and they will do anything to make money." – Reuters
Fully digital mobile service Yoodo is now offering eSIM to users of iPhone XS, XS Max and XR so a physical SIM card doesn’t have to be mailed to them.
Yoodo says on its site that users can apply for an eSIM via its app – the option can be found under Select/Activate a SIM tab.
When applying for an eSIM, users can customise their data, voice and SMS packages, as well as pick a number.
Customers will receive a QR code via email which will allow them to add the customised mobile plan to their device. Yoodo says eSIMs are more convenient as users don’t have to physically insert and remove SIM cards.
They can also choose to have two phone lines – one using eSIM and another using a regular SIM card.
An eSIM or embedded SIM is a built-in phone chip that works just like a physical SIM. It can store multiple numbers and plans, but only one can be used at anytime. The eSIM can be activated via the app – users will be required to scan their MyKad or passport and take a selfie for facial recognition. Customers can still order a physical SIM card via the app or Web though the free delivery can take up to three days. Express delivery which only takes two hours within the Klang Valley costs RM15. Yoodo is owned and operated by Celcom Axiata Bhd.
Chevron said Thursday it will not submit a new offer to acquire Anadarko Petroleum, walking away from the deal after Occidental Petroleum pulled ahead in a battle to take control of the driller with prized assets in the top U.S. shale oil field.
The decision means Chevron will collect a $1 billion breakup fee, a windfall that it could use to purchase another driller in the Permian Basin, the engine of the American oil drilling boom.
Shares of the San Ramon, California-based oil major jumped about 3% in premarket trading following the announcement.
Anadarko announced on Monday that its board had unanimously decided that Occidental's revised $38 billion bid was superior to a $33 billion Chevron buyout. Anadarko said it intended to break its agreement with Chevron and strike a deal with Occidental if Chevron did not submit a better offer. Occidental, with backing from Warren Buffett's Berkshire Hathaway, offered to pay 78% cash and 22% stock for Anadarko, while the Chevron transaction was structured as a 75% stock and 25% cash deal.
"Winning in any environment doesn't mean winning at any cost. Cost and capital discipline always matter, and we will not dilute our returns or erode value for our shareholders for the sake of doing a deal," Chevron Chairman and CEO Michael Wirth said in a statement.
Chevron surprised the market on Thursday by announcing that it still intends to raise its share buyback program to $5 billion per year. Two weeks ago, Chevron executives told analysts the increase was contingent on the deal closing. By taking control of Anadarko, Chevron stood to acquire the driller's vast acreage in the Permian region stretching from western Texas to southeastern New Mexico. Chevron is a major player in the Permian and plans to double its production from the basin by 2023. The deal also would have combined Chevron and Anadarko's offshore operations in the Gulf of Mexico, a source of precious cash flow. Chevron also prized Anadarko's liquefied natural gas export project in Mozambique, which would have expanded its footprint in the growing LNG market. However, Chevron was outmaneuvered by its much smaller rival. After Occidental put in a higher bid, it secured a $10 billion investment from Berkshire Hathaway and arranged to sell Anadarko's African operations to French oil giant Total for $8.8 billion.
Those arrangements allowed Occidental to increase the cash component of its offer, which in turn meant the company would not have to put the transaction to a shareholder vote. That cleared up uncertainty about Occidental's ability to close the deal.
Occidental's battle is not over yet though. Some of the company's stockholders are angry that they will not get to vote on the deal and are concerned that their investment will be diluted if Buffett exercises his option to buy up to 80 million shares of Occidental. Occidental CEO Vicki Hollub has also come under criticism for agreeing to pay a steep 8% annual dividend on Buffett's preferred stock investment. Despite technically losing, some analysts applauded Chevron for avoiding a bidding war. "Chevron did exactly the right thing and walked away, and the client feedback has been raining in positive," said Mizuho Securities analysts Paul Sankey. "The generalists particularly hated that the last decently performing sector in energy — mega-cap oil — was potentially losing its capital discipline." |
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