General Motors reports a jump in profit as demand for vehicles climbs.
Daily Business Briefing
Aug. 4, 2021Updated Aug. 4, 2021, 9:14 a.m. ETAug. 4, 2021, 9:14 a.m. ETThe latest response to the Delta variant: Masks will be required at unionized auto plants.Success rates for the CFA exam, a popular qualification in finance, plunge.Water recycling is seen as a promising sustainability effort and a smart investment.Longstanding Wall Street dress codes are being relaxed, allowing even for jeans.
The General Motors headquarters in Detroit. The automaker said it made $2.8 billion in the second quarter and raised its full-year forecast.Credit…Rebecca Cook/Reuters
General Motors said on Wednesday that it made $2.8 billion in the second quarter and increased its profit forecast for the full year, suggesting the largest U.S. automaker was faring a lot better than expected.
G.M. and other automakers have been forced to idle factories periodically this year because of a global shortage of computer chips. The production slowdown has kept a lid on sales, but it has created shortages of new and used cars, increasing the selling price of cars and trucks.
Three months ago, G.M. indicated it would only make about $500 million in the three months that ended in June, after earning $3 billion in the first three months of the year. The second quarter results including $1.3 billion in warranty and recall costs, including $800 million for fixes to Chevrolet Bolt electric cars whose batteries can overheat and catch fire — a big headache for G.M., which plans to do away the internal combustion engine in its cars and trucks by 2035.
The company reported revenue of $34.2 billion in the second quarter, up from $16.8 billion a year ago. In the first quarter, G.M. had revenue of $32.5 billion.
G.M. now expects to make an profit of $11.5 billion to $13.5 billion before interest and tax in 2021, up from the $10 billion to $11 billion it had previous expected.
In a letter to shareholders, G.M.’s chief executive, Mary T. Barra, said the company had managed the chip shortage by allocating electronic components in short supply to the plants making its most profitable and popular models. In a conference call to discuss the results, she said the shortage would continue to be a problem until next year.
“G.M. had a very strong second quarter and first half of the year,” Ms. Barra said. “Of course, we will continue to monitor Covid very closely.”
Workers leave a plant owned by Fiat Chrysler, now known as Stellantis, last year. All autoworkers at unionized plants in the U.S. will be required to resume wearing masks.Credit…Paul Sancya/Associated Press
All autoworkers will be required to wear masks at unionized plants, offices and warehouses, the United Automobile Workers union, General Motors, Ford Motor and Stellantis said on Tuesday. The requirement will apply regardless of whether workers are vaccinated and is in response to the latest guidance from the Centers for Disease Control and Prevention. The union and automakers said they would not require workers to be vaccinated but were “strongly encouraging” vaccinations.
Tyson Foods, one of the nation’s largest meat processors, said on Tuesday that it would require vaccines for its U.S. workers — about half of whom remain unvaccinated. Vaccinations will be a condition of employment for all U.S. workers, and any new employees must be vaccinated before they start work, the company said. Tyson is offering $200 to frontline workers who verify that they are fully vaccinated. The company already offered employees up to four hours of pay if they are vaccinated outside of their normal shift.
Microsoft will require proof of vaccination for all employees, vendors and guests to gain access to its U.S. offices, the tech giant said Tuesday in an email to employees, adding that it will push back its return-to-office date by a month, to no earlier than Oct. 4. Parents with children who are too young to be vaccinated will be able to work from home until January. The company employs roughly 100,000 people in the United States and had previously planned to return to office in early September, though with flexibility for employees to work up to half of their time from home.
Passing the CFA exam, in the best of times, is tough. The test, which confers chartered financial analyst status, has three levels, and study times average 300 hours per level. CFA status is a resume booster that can open doors and fetch a higher salary in the financial services industry.
Last week, the CFA Institute reported that the Level I pass rate dropped to 25 percent for exams taken in May, the lowest since testing began in the 1960s. On Tuesday, the institute announced that the latest Level II success rate fell to 40 percent, the third-lowest rate on record.
CFA exam pass rates
What happened? Theories abound, including that a popular prep website had technical issues, that it was the first time some tests were administered via computer and that Covid protocols delayed some test takers from starting the test on time.
The CFA Institute denies all of those. Instead, it said pandemic-related test delays had disrupted study plans.
The DealBook newsletter notes another potential factor: Achieving CFA status may not seem as essential right now, given the complications of pandemic restrictions and the desperation of financial firms to hire workers with deal flow so high and morale so low. This week, Goldman Sachs joined its Wall Street rivals in increasing pay for junior bankers across the board. This could be why fewer people recently sat for the CFA exams and, when they did, may not have put in their best performance.
A system installed at Salesforce Tower in San Francisco will filter an estimated 40,000 gallons of water a day. Credit…Jim Wilson/The New York Times
The concept of filtering the dirty water generated by daily operations for use in toilets and drip irrigation isn’t new, but it’s increasingly seen as a promising sustainability push, especially as more cities and states enact measures to limit water use, and as a smart hedge against rising water costs and future shortages, Patrick Sisson reports for The New York Times.
Water-conservation advocates say such technology is where solar and renewable power were a decade ago: technologically feasible, with pioneering projects starting to bend the cost curve and push the concept toward wider accessibility.
“Ten or 15 years ago, a green building was a ‘nice to have,’ whereas now it’s driven by regulations and the market,” said Aaron Tartakovsky, a co-founder and the chief executive of Epic Cleantec, a wastewater tech start-up in San Francisco. “It’s undeniable that the drought has accelerated conversations many were already having.”
Increasingly, developers see value in so-called black-water systems, especially at scale, to provide water for irrigation and cooling towers. Even the cost to retrofit a building, long considered infeasible because of the need to add so many pipes for recycled water, is now more viable, Mr. Tartakovsky said.
Mission Rock, a 28-acre, $2.5 billion multiuse waterfront project led by the San Francisco Giants and developed by Tishman Speyer, will use a black-water system. Every building on the site, which broke ground this year, will tie into it over time. A new nonprofit utility, Mission Rock Utilities, will build and manage both it and a central thermal energy system.
Water reuse isn’t being embraced just in drought-stricken Western states. On the Brooklyn waterfront, the 11-acre, roughly $3 billion Domino Sugar Refinery redevelopment will feature a more than $10 million black-water system designed not only to cut water use but to reduce pressure on storm-water systems.
Residents are acutely aware of water quality. “It’s pretty obvious when there’s a storm and the East River smells like poop,” said one developer.