TheChek News Flow

Ontario premier insists development of remote critical minerals reserve is a priority in response to Trump’s tariffs

Canada is fast-tracking development of a critical minerals reserve over indigenous opposition to generate much-needed revenue in response to US President Donald Trump’s devastating tariffs.

Trump is a “wake-up call” for the country to kick start its economy and developing the Ring of Fire” project in the far north of Ontario is “a top priority”, the province’s premier Doug Ford told the Financial Times.

Ring of Fire “has more critical minerals than anywhere else in the world”, Ford said. “Our goal is to get things going in 24 months and seeing progress, building roads, and getting the transportation up there.”

The deposit, about 1,000km north of Toronto, was discovered in 2008 and covers roughly 5,000 square kilometres. Named for its crescent shape and geological formation it contains vast quantities of minerals, including nickel, copper and platinum elements.

But its location on lands belonging to First Nations tribes, as well as the huge costs and environmental risks involved in developing the region have delayed its progress.

Indigenous groups, along with environmental and civil liberties organisations, fear the provincial government is using the tariff threat as a pretext for pushing through the project without proper consultation.

“Long before Trump was elected, long before the tariffs, this was Ford’s plan,” said chief Wilfred King from Gull Bay First Nations. “He stated publicly that he would even ‘drive the bulldozer to the Ring in Fire,’ so he’s not fooling anybody but himself.”

Ford says he has “great partnerships” with Aroland, Webequie and Marten Falls Nations, but King said the First Nations have not been consulted or informed about government plans to develop the site.

On Monday Aroland chief Sonny Gagnon criticised Ford’s “misleading and incorrect” comments and called for a “proper assessment” of the project to protect wildlife, water and climate.

“Aroland does not in any way indicate . . . consent for mining in the Ring of Fire,” he said.

Ontario’s provincial legislature earlier this month passed bill 5 — dubbed the Unleashing the Economy Act — which aims to speed up large projects such as the Ring of Fire as part of Canada’s push to diversify its economy in the wake of US tariffs.

Last week Prime Minister Mark Carney’s government introduced wide-ranging economic legislation, known as the One Canadian Economy Act, that gives Ottawa broad powers to fast-track projects it identifies as in the national interest.

The prime minister mentioned the Ring of Fire as one of a “long list of projects that bring the country together, diversify our markets, make us more resilient, create good jobs and grow, have very good prospects of indigenous partnerships and beyond”.

He added cutting red-tape would accelerate infrastructure projects. Industry has long complained mining permits and approval processes cause lengthy delays to projects.

Luca Giacovazzi, chief executive of Perth, Australia-based Wyloo, which acquired mineral rights in the region four years ago, said the Ring of Fire site contains six or seven ore bodies that could be tapped as soon as 2030.

The project was the subject of a fierce bidding war in 2021 when Australian miners BHP and Wyloo, part of the billionaire iron ore magnate Andrew Forrest’s Tattarang operations, battled to buy out Canadian miner Noront, which had started developing the Eagle’s Nest mine in the Ring of Fire region.

Forrest compared the Ring of Fire’s potential to the Western Australian Pilbara area, which produces much of the world’s iron ore.

“What we’re seeing now is the right alignment between both the federal government and the provincial government to move forward,” Giacovazzi said.

Ford said Ontario has committed C$1bn (US$735mn) to building a road that would improve access to the Ring of Fire region, which can currently only be reached by plane.

“We have to make sure we get shovels in the ground and get the minerals out, and there’s nowhere else I want to ship them to than our closest allies and friends in the US,” he said.

But according to King, “Ford does not have blanket First Nations support for this”. He said Ontario’s first nation chiefs will meet later this month to discuss the project and “obviously, litigation would be one avenue”.

Ford said First Nations communities in the region have been offered a potential C$3bn equity stake in the project, which could bring much-needed jobs and income.

He called those who oppose the development “a bunch of hypocrites”.

China’s car industry runs on empty as supply chain bills go unpaid

Beijing has acted to ease stresses of a damaging price war with carmakers pressed to settle invoices within 60 days

Chinese carmakers’ price war is putting the industry’s balance sheet under strain, a Financial Times analysis has revealed, as Beijing demands more action to protect suppliers in the world’s largest car market.

Current liabilities exceeded current assets at more than a third of publicly listed car manufacturers at the end of last year, according to FT calculations based on their most recent financial reports. 

The weakening liquidity picture highlights how China’s leading carmakers are being forced to squeeze suppliers to maintain working capital and fund their fight for market share amid heavy discounting.

The dominant electric-vehicle maker BYD is deepest in negative territory with its working capital, followed by rivals Geely, Nio, Seres and state-backed BAIC and JAC, while the total net current assets of 16 major listed Chinese carmakers fell to Rmb104.3bn ($14.5bn) by December 31 — a 62 per cent decline from their Rmb290.5bn peak in the first half of 2021.

Yin Xinchi, a car industry analyst at Citic Securities, said a decline in net current assets indicated an increasing rate of cash consumption, with liquidity risks as the numbers turned negative.

“Given the current downward trend, China’s auto industry is expected to enter an industry-wide elimination phase . . . in 2026 at the latest,” he warned. “During the process, some companies will die of liquidity crises.”

Beijing showed its concern about the state of the market last week. In a meeting with 16 major domestic carmakers, government officials issued verbal warnings about aggressive discounting and overdue payments to suppliers, according to two people familiar with the matter. The “zero-mileage” practice of selling brand-new cars as cut-price second-hand vehicles has also been criticised.

This week, companies that attended the meeting, including BYD, Geely, Xiaomi and state-backed GAC and FAW, committed to 60-day bill settlements with the aim of “ensuring supply chain stability”.

Citi analysts noted in a report that only a handful of Chinese EV makers — BYD, Li Auto, Xpeng, Leapmotor and Changan — currently had sufficient net cash to cover the decline in cash reserves that would follow the implementation of a shorter payment cycle.

Other analysts have noted BYD’s heavy use of working capital rather than debt financing to fuel its rapid growth.

“None of BYD’s recent growth has been financed with conventional debt. Instead, it has relied on funding from working capital,” said Nigel Stevenson, an analyst at Hong Kong-based GMT Research, who also referred to company practices such as delaying payments to suppliers to maintain cash flow.

“This means that debt as normally measured is understated,” he added.

By the end of 2024, BYD’s current assets of Rmb371bn were exceeded by Rmb496bn in current liabilities. That widened BYD’s working capital deficit to Rmb125.4bn — 36 per cent higher than two years earlier when the price war commenced, according to FT research.

Its smaller rivals — Geely, Nio, Huawei’s EV partner Seres, BAIC and JAC — recorded a total working capital deficit between them of Rmb17.8bn in comparison.

BYD recently came under pressure to defend its financial numbers and business practices after Wei Jianjun, chair of rival Great Wall Motor, called for a comprehensive audit of all major domestic carmakers.

“An Evergrande exists in [China’s] auto sector at the moment — it just hasn’t blown up,” he told local media, raising the spectre of the industry following the property sector into a spiralling debt crisis.

In response, BYD’s public relations head Li Yunfei called Wei’s remarks “astonishing”. In a social media post, he said BYD’s interest-bearing debt stood at Rmb28.6bn in 2024 — significantly lower than that of competitors such as Geely, at Rmb86bn, and Volkswagen, at Rmb1tn.

“The larger a company grows and the higher its revenue, the greater its procurement and collaboration volume,” Li added, in response to criticism of BYD’s extended payment periods.

BYD declined to comment when contacted by the FT.

In another sign of increasing competition, margins are becoming wafer-thin.

In the first quarter of 2025, carmakers’ operating profit margins averaged 3.9 per cent, a drop of 0.7 percentage points from a year earlier, according to data from the National Bureau of Statistics, although BYD’s margins have been improving. The industry’s aggregate profits dropped 6.2 per cent year on year to Rmb95bn in the three-month period.

Concerns about a looming “growth without profits” scenario have prompted industry associations and regulators to issue a series of warnings about China’s EV boom.

“Price wars . . . are pushing the industry into a vicious cycle,” the China Association of Automobile Manufacturers said last month, while asking “leading companies” not to monopolise the market or undermine the survival of other groups.

China’s Ministry of Industry and Information Technology, the country’s top automotive regulator, said in a statement it supported the association and would expand its efforts to prevent a “rat race” and “unfair” competition. 

“It’s hard to do anything in the domestic market,” complained an executive at a state-owned carmaker, who asked to remain anonymous. “Everything is fiercely competitive, leaving a brutal and bloody battlefield.”

While analysts have been predicting for years that cut-throat competition will lead to consolidation as the worst-performing companies are wiped out, the process is unfolding more slowly than expected.

State support for the industry has remained strong. In one example, Nio was rescued by a near-$1bn bailout in 2020 by state-owned investors from Anhui in eastern China.

Beijing’s antitrust regulator postpones sign-off on Synopsys and Ansys deal

A $35bn US semiconductor industry merger is being delayed by Beijing’s antitrust regulator, after Donald Trump tightened chip export controls against China in a move that exacerbated trade tensions between the world’s two largest economies.

China’s State Administration for Market Regulation has postponed its approval of the proposed deal between Synopsys, a maker of chip design tools, and engineering software developer Ansys, according to two people with knowledge of the matter.

The transaction between the American groups, which has received the blessing of authorities in the US and Europe, had already entered the last stage of SAMR’s approval process and was expected to be completed by the end of this month, said the people.

The delay comes as Washington moved to ban chip design software sales by US companies, including Synopsys, to China in late May. That decision has contributed to the complexity of China’s approval process for this deal, according to a person with knowledge of the situation.

The person added that approval, while taking longer than expected, could still come through if Synopsys were able to submit solutions that addressed the Chinese regulator’s concerns.

However, another person with knowledge of the matter said SAMR’s approval process had recently been prolonged from its original 180-day schedule due to the complexity of the deal itself, rather than being directly linked with the ongoing trade war.

On the company’s latest earnings call on May 28, Synopsys chief executive Sassine Ghazi said the company was “working cooperatively and actively negotiating with SAMR to secure China regulatory clearance”, and that it expected to close the deal “in the first half of this year”.

The deal agreement includes a January 15 2026 “drop dead clause”, according to company filings.

Synopsys declined to comment. Ansys did not respond to a request for comment. A call made to SAMR outside regular working hours was not answered.

The move comes amid US-China trade talks. This week, Trump said the two sides had reached an agreement in London to reinstate the trade war truce reached in Geneva in May, when the US and China significantly cut the high level of tariffs they had imposed on each other.

A senior White House official said this week that Trump could ease controls on technology exports to China if Beijing agreed to speed up shipments of rare earths.

There have also been signs of a potential loosening of the US ban on selling chip design tools. Synopsys, which earlier stopped all sales to Chinese clients, has restarted selling intellectual property and hardware, while so-called electronic design automation-related software tools are still restricted, according to a person with direct knowledge of the matter.

licon Valley-based Synopsys’s tools and intellectual property are used by chipmakers including Nvidia and Intel to help design and test their processors.

The semiconductor designer has grown in recent years as Big Tech companies including Microsoft, Google, Meta and Amazon strive to create more of their own chips, in particular to handle artificial intelligence systems in the cloud.

Ansys, which is based in Pennsylvania and has its origins in structural analysis tools, makes engineering simulation software used in industries from cars and construction to healthcare and defence.

WASHINGTON, June 12 (Reuters) - Memory chip maker Micron Technology (MU.O), opens new tab said on Thursday it is expanding its U.S. investments by $30 billion as President Donald Trump presses companies to boost U.S. investments and threatens new tariffs on semiconductors.

Micron now says its planned investments will total $200 billion. The company last year said it planned to invest around $100 billion in manufacturing in New York and $25 billion in Idaho.

In December, the U.S. Commerce Department under former President Joe Biden finalized a nearly $6.2 billion government subsidy for Micron to produce semiconductors in New York and Idaho, one of the largest government awards to chip companies under the $52.7 billion 2022 CHIPS and Science Act.

Trump has repeatedly threatened to kill the CHIPS act. His administration is renegotiating some of Biden's grants to semiconductor firms, Commerce Secretary Howard Lutnick said last week.

AI chip leader and Micron customer Nvidia (NVDA.O), opens new tab said in April it is planning to build AI servers worth as much as $500 billion in the U.S. over the next four years with help from partners such as Taiwan's TSMC (2330.TW), opens new tab.

Micron's additional investment will center around building a second leading-edge memory fab in Boise, Idaho, and expanding a manufacturing facility in Manassas, Virginia.

"These investments are designed to allow Micron to meet expected market demand, maintain share and support Micron's goal of producing 40% of its DRAM in the U.S," the company said, referring to a type of widely employed memory chip.

DRAM chips are key components in personal computing, cars, industrial operations, wireless communications and artificial intelligence and Micron's High-Bandwidth Memory is critical for enabling new AI models, officials have said.

The company will also dedicate about $50 billion to R&D, Micron said.

"Micron's investment in advanced memory manufacturing and HBM capabilities in the U.S., with support from (the) Trump administration, is an important step forward for the AI ecosystem," Nvidia CEO Jensen Huang said.

Micron also said it finalized a $275 million direct funding award under the CHIPS Act to expand its Manassas facility.

WASHINGTON, June 12 (Reuters) - The role of Elon Musk's SpaceX in an ambitious new U.S. missile defense system is in question following the dramatic feud last week between the billionaire entrepreneur and President Donald Trump, according to three people familiar with the project.

The White House until recently had considered a plan for SpaceX, Musk's rocket and satellite venture, to partner with software maker Palantir (PLTR.O), opens new tab and drone builder Anduril to construct crucial elements of the project, dubbed "Golden Dome." The administration had instructed the Pentagon to prioritize a network of satellites for the purpose, these people said.

But a new framework for the system, which would seek to track and prevent possible missile attacks against the United States, is now being considered that could reduce the role of SpaceX. One possibility, the three people said, could initially forego SpaceX's satellite capabilities and focus on the expansion of existing ground systems for missile defense instead.

In a statement, a White House spokesman said "the Trump Administration is committed to a rigorous review process for all bids and contracts." A senior Defense Department official said the Pentagon "has no announcements regarding future contracts associated with the Golden Dome effort."

SpaceX, Anduril and Palantir didn't respond to requests for comment.

A reduced role for SpaceX would represent the first known setback to Musk's huge volume of business with the U.S. government since his break with Trump last week. The shift in plans, especially for a project that Trump has touted as paramount for U.S. defense strategy, also underscores the highly personalized nature of the president's leadership, aerospace and defense experts said.

"That people guiding the program or building it are approved based on their political affiliation signals a real concern that the project itself is very politicized and not being conducted on the technical merits," said Laura Grego, a missile defense expert and research director at the Union of Concerned Scientists, a non-profit based in Cambridge, Massachusetts.

In its statement to Reuters, the White House said any decision would be made "prioritizing the best deal for America and leveraging the most advanced and innovative technology."

Trump in May said the defense shield should be operational by the end of his presidency, January 2029. But industry experts have said that timeframe, and a projected cost of some $175 billion, could be too optimistic.

The change in the proposed "architecture" of the system, the three people said, could have the political advantage of allowing the current administration to deliver at least a portion of it. It isn't clear how soon a final decision on the project could come or whether the ultimate role of any company, including SpaceX, has been determined.

Trump's efforts to roll out the project fast have led to uncertainty about the project's details and a scramble by contractors to be involved, industry experts and some of those involved in its development told Reuters. "To this day, no one knows what the requirements are," said one of the people familiar with the process. "There isn't a coordinated effort with a true vision. All of these companies are just grabbing at this pot of money."

SpaceX, Anduril and Palantir were all founded by entrepreneurs who have been major political supporters of Trump. The three companies had previously met with top administration officials and decisionmakers from the Defense Department to discuss Golden Dome, according to people familiar with those discussions.

Before his high-profile falling out with the president, Musk served as a key Trump advisor and donated more than a quarter of a billion dollars to help elect him. But the recent dispute, which included Musk calling for Trump's impeachment and accusing the president of improper involvement with disgraced financier and sex offender Jeffrey Epstein, triggered the change in direction, the three people told Reuters.

"Because of the blowup, the Pentagon has been given the space to look at other alternatives," one of the people said.

In recent days, Musk has sought to temper the dispute, saying he regretted some of his comments and taking down some of his social media criticism of Trump, including the call for impeachment. Earlier this week, Press Secretary Karoline Leavitt told reporters that Trump appreciated Musk's apology and that she was unaware of any administration efforts to review Musk contracts because of the dispute.

Reuters couldn't determine whether Musk's conciliatory overtures might improve SpaceX's chances of winning Golden Dome contracts or securing further new business with the U.S. government.

SpaceX had pitched for a part of the Golden Dome initiative called the "custody layer," a constellation of between 400 and 1,000 satellites that would detect missiles, track their trajectory, and determine if they are heading toward the U.S., Reuters reported in April. In a January 27 executive order, Trump mandated the selection of a proposed "architecture" for Golden Dome and an implementation plan by the end of March.

The order called a missile attack "the most catastrophic threat facing the United States."