1. Tesla overtakes Toyota to become the world’s most valuable automaker
Tesla has overtaken Toyota to become the world’s most valuable carmaker by market value, also marking its 10th anniversary of entering the stock market.
The electric carmaker’s shares have climbed fivefold during the past year, from $230 last year to $1,100 on Wednesday, taking the company’s market cap to $205 billion.
Toyota, the world’s second-largest single carmaker measured by output with annual production of more than 10 million vehicles, was worth about $200 billion on Wednesday. Of course, these things can change daily.
Once debt is included, the Japanese group is still worth more, of course.
What’s crazy is that Tesla’s shares trade on a multiple of almost 220 times the company’s profits, far above any other auto business. Even Elon Musk himself tweeted that Tesla’s share price is too high, but that didn’t do any permanent damage to the price.
The pandemic has lowered global demand for cars, with sales expected to fall by 15% this year, while demand for electric vehicles is expected to grow, also driven by regulations in the EU & China.
2. US records continuously higher infections, New York City halts indoor dining
Despite our safe bubble here in Thailand, the rest of the world and particularly the US is still grappling with growing cases of Covid-19. California has rolled back re-opening plans and NYC has paused re-opening restaurants for indoor dining, sending more setbacks to the hurting hospitality business.
South Florida counties are requiring people to wear face masks and restricting alcohol sales at hotel ahead of the July 4th weekend, typically a party centric holiday.
Los Angeles has closed down restaurants, movie theatres and museums. Apple plans to close 30 additional stores this week in the US, bringing the total of re-closed stores to 77.
The US reported 44,700 cases today.
3. Apple freezes updates for mobile games on China App Store
Apple has frozen updates for tens of thousands of mobile games on its App Store in China, due to increasing pressure from the government to comply to regulations.
China is Apple’s biggest App Store market, with sales of $16.4 billion a year, so this could be tricky.
Until now, Apple has allowed Chinese games to be downloaded from the App Store while their developers wait for an official licence from Chinese regulators. But earlier this year, Apple warned game developers they would need to show proof their game had a licence by June 30, if not, they wouldn’t be able to update their games.
Analysts and lawyers in Beijing suggested that the Chinese government had decided to step up enforcement on Apple, in response to growing tensions between US & Beijing.
4. Pizza Hut operator files for bankruptcy in the US
NPC International, the largest franchisee of Pizza Hut & fast food chain Wendy’s in the US has filed for bankruptcy after Covid-19 related shutdowns have added to competitive pressure.
NPC applied for Chapter 11 protection in the Southern District of Texas court.
The company was founded in 1962 and operates 1,227 Pizza Hut and 393 Wendy’s stores across the country. It has $903 million in debt.
NPC can keep operating while it works out a plan to pay its lenders and turn the business around, and the bankruptcy doesn’t affect the thousands of other Pizza Hut and Wendy’s outlets owned by other franchisees.