FT : US scientists boost clean power hopes with fusion energy breakthrough

US scientists boost clean power hopes with fusion energy breakthrough
Net energy gain indicates technology could provide an abundant zero-carbon alternative to fossil fuels

US government scientists have made a breakthrough in the pursuit of limitless, zero-carbon power by achieving a net energy gain in a fusion reaction for the first time, according to three people with knowledge of preliminary results from a recent experiment.

Physicists have since the 1950s sought to harness the fusion reaction that powers the sun, but no group had been able to produce more energy from the reaction than it consumes — a milestone known as net energy gain or target gain, which would help prove the process could provide a reliable, abundant alternative to fossil fuels and conventional nuclear energy.

The federal Lawrence Livermore National Laboratory in California, which uses a process called inertial confinement fusion that involves bombarding a tiny pellet of hydrogen plasma with the world’s biggest laser, had achieved net energy gain in a fusion experiment in the past two weeks, the people said.

Although many scientists believe fusion power stations are still decades away, the technology’s potential is hard to ignore. Fusion reactions emit no carbon, produce no long-lived radioactive waste and a small cup of the hydrogen fuel could theoretically power a house for hundreds of years.

The US breakthrough comes as the world wrestles with high energy prices and the need to rapidly move away from burning fossil fuels to stop average global temperatures reaching dangerous levels. Through the Inflation Reduction Act, the Biden administration is ploughing almost $370bn into new subsidies for low-carbon energy in an effort to slash emissions and win a global race for next-generation clean tech.

The fusion reaction at the US government facility produced about 2.5 megajoules of energy, which was about 120 per cent of the 2.1 megajoules of energy in the lasers, the people with knowledge of the results said, adding that the data was still being analysed.


The US department of energy has said energy secretary Jennifer Granholm and under-secretary for nuclear security Jill Hruby will announce “a major scientific breakthrough” at the Lawrence Livermore National Laboratory on Tuesday. The department declined to comment further.

The laboratory confirmed that a successful experiment had recently taken place at its National Ignition Facility but said analysis of the results was ongoing.

“Initial diagnostic data suggests another successful experiment at the National Ignition Facility. However, the exact yield is still being determined and we can’t confirm that it is over the threshold at this time,” it said. “That analysis is in process, so publishing the information . . . before that process is complete would be inaccurate.”

Two of the people with knowledge of the results said the energy output had been greater than expected, which had damaged some diagnostic equipment, complicating the analysis. The breakthrough was already being widely discussed by scientists, the people added.

“If this is confirmed, we are witnessing a moment of history,” said Dr Arthur Turrell, a plasma physicist whose book The Star Builders charts the effort to achieve fusion power. “Scientists have struggled to show that fusion can release more energy than is put in since the 1950s, and the researchers at Lawrence Livermore seem to have finally and absolutely smashed this decades-old goal.”

The $3.5bn National Ignition Facility was primarily designed to test nuclear weapons by simulating explosions but has since been used to advance fusion energy research. It came the closest in the world to net energy gain last year when it produced 1.37 megajoules from a fusion reaction, which was about 70 per cent of the energy in the lasers on that occasion.

At the launch of a new White House fusion power strategy this year, Congressman Don Beyer, chair of the bipartisan fusion energy caucus, described the technology as the “holy grail” of clean energy, adding: “Fusion has the potential to lift more citizens of the world out of poverty than anything since the invention of fire.”

Most fusion research is focused on a different approach known as magnetic confinement fusion, in which the hydrogen fuel is held in place by powerful magnets and heated to extreme temperatures so the atomic nuclei fuse.

Historically, that science has been done by large publicly funded laboratories, such as the Joint European Torus in Oxford, but in recent years investment has also flooded into private companies promising to deliver fusion power in the 2030s.

In the 12 months to the end of June, fusion companies raised $2.83bn in investment, according to the Fusion Industry Association, bringing total private sector investment to date to almost $4.9bn.

Nicholas Hawker, chief executive of Oxford-based start-up First Light Fusion, which is developing an approach similar to that used at NIF, described the potential breakthrough as “game-changing”.

“It couldn’t be more profound for fusion power,” he said.

CrunchBase : The Week’s 10 Biggest Funding Rounds: Investors Fanatical About Fan

The Week’s 10 Biggest Funding Rounds: Investors Fanatical About Fanatics; Avant Locks Down $250M

We’ve been away for a couple of weeks, but now we’re back to cover the top rounds of the week. Funding news in general seemed to pick up after the typical slowdown before Thanksgiving, but large rounds were hard to find, with only five rounds of more than $100 million.
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1. Fanatics,$700M, retail: Fanatics made this same list in March after The Wall Street Journal reported that the Jacksonville, Florida-based company raised $1.5 billion in a new funding round. That valued the sports retail platform company at $27 billion. However, the sports merchandising giant wasn’t done. The Journal reported the company now has raised $700 million at a $31 billion valuation. Private-equity firm Clearlake Capital Group led the round, which will be used primarily for M&A activity. Earlier in the year, it acquired Topps trading cards for $500 million.

2. Avant, $250M, financial services: For some, securing credit can be difficult. Chicago-based Avant is a VC-backed fintech platform catering to that crowd — the non-prime consumer market. This week, Ares Management Alternative Credit decided Avant’s platform was attractive enough to pour a quarter-billion dollars into it. The $250 million raise was a mix of corporate debt and redeemable preferred equity. This year, Avant has surpassed $1 billion in the total amount of asset-backed debt financing commitments secured. Founded in 2012, the company has raised more than $2 billion, according to Crunchbase.

3. Drata, $200M, cybersecurity: Drata continues to go big and fast. The San Diego-based company locked up a $200 million Series C co-led by ICONIQ Growth and GGV Capital at a $2 billion valuation — doubling its valuation from its $100 million Series B in November 2021. Before that, the company raised a seed round in January 2021, then its Series A in June 2021. According to Crunchbase, Drata has now raised more than $328 million in less than two years. Drata’s automation platform helps companies with security compliance. That area has long garnered interest from investors as more regulations flood sectors such as finance and health care, which may explain the ability to fundraise.

3. (tied) First Mode, $200M, industrial engineering: Even with everyone striving for carbon reduction, there are some sectors that don’t seem to lend themselves to it. Heavy industry and mining is one of those. However, Seattle-based First Mode entered a deal with mining company Anglo American to try to accomplish just that. First Mode agreed to combine with Anglo American’s nuGen hauling solutions unit and supply those vehicles with its hybrid fuel cell battery powerplant. The newly combined business will be valued at $1.5 billion and includes a $200 million equity injection from Anglo American.

5. Apogee Therapeutics, $149M biotech: San Francisco-based Apogee Therapeutics closed a $149 million Series B co-led by Deep Track Capital and RTW Investments. The company is developing therapies for immunological and inflammatory disorders — like inflammatory bowel disease. Apogee is the first spinout company from Paragon Therapeutics. Founded in 2020, the company has raised $169 million, per Crunchbase.

6. Entact Bio, $81M, biotech: Watertown, Massachusetts-based Entact Bio, which is developing medicines that enhance the function of key proteins, raised an $81 million Series A co-led by Qiming Venture Partners USA and venBio Partners.

7. (tied) Sound Agriculture, $75M, agtech: Emeryville, California-based Sound Agriculture closed a $75 million Series D led by new investors BMO Impact Investment Fund and Chan Zuckerberg Initiative. Founded in 2013, the company — which creates climate resilient crops — has raised more than $170 million, according to Crunchbase.

7. (tied) Sonatus, $75M, automotive: Sunnyvale, California-based Sonatus, a developer of automotive software, raised a $75 million round led by Foxconn. Sonatus has now raised over $110 million, per the company.

9. SonoThera, $61M, biotech: South San Francisco-based SonoThera closed a $61 million Series A led by ARCH Venture Partners. The company will use the new proceeds to develop its ultrasound-guided, gene therapy platform and treatments.

10. ZincFive, $54M, battery: Portland-based ZincFive, a developer of nickel-zinc-based energy storage solutions, raised a $54 million Series D led by Helios Climate Ventures. ZincFive has now raised $139 million since its inception, according to the company.


Big global deals
No global round topped Fanatics this week, but two of the week’s top five rounds came from abroad.

Miss Tweed : Richemont Fashion Series: 1-What is the future of AZ Factory?



The future is uncertain for AZ Factory, the fashion start-up backed by luxury goods giant Richemont and founded by the famed designer Alber Elbaz who died in April last year aged 59. Key members of the dream team Elbaz brought together in the months before his passing have decided to leave or have left the company, several sources close to the fashion brand have said.

Richemont, which derives most of its revenues from megabrand Cartier, can afford to stomach AZ Factory’s losses for some time. They represent only a few tens of millions of euros – small change for a group that made 2.1 billion euros in profit in its last fiscal year. Still, the story of the coming apart at the seams of AZ Factory serves as a microcosm of the problems with Richemont’s management of fashion. It also provides more ammunition to those investors who argue the group needs to narrow its focus to its watches and jewelry core businesses.

POINTY SNEAKERS
The story starts in January 2021, when Elbaz, a much-feted designer who had infused new life into Lanvin from 2001 to 2015, promised a fashion revolution with the launch of his new inclusive, technology-driven brand. AZ Factory would tell stories around products instead of collections. Elbaz wished to challenge the century-old tradition of dressing women only of a certain size and create a new business model better fit for the Internet age where trends are driven in real time by social media and algorithms, and by consumers of all shapes and sizes.

Highlights from AZ Factory’s launch included pointy sneakers that elongated silhouettes, dresses using figure-shaping technology and chic pajamas featuring prints of Elbaz’s drawings. “We are on a journey to design beautiful, purposeful, solutions-driven fashion that works for everyone,” Elbaz wrote on his brand’s website. “We are life, not just lifestyle, a place to experiment and try new things, our way. We believe in fashion that cares.”

Elbaz, who also designed for Yves Saint Laurent, was known for his short, ultra-feminine cocktail dresses and his passion for innovative, new fabrics that made his looks stand out. Suzy Menkes, the fashion critic, had described Albaz in his heyday when season after season he produced beautiful, simple and well-cut dresses as “every woman’s darling”. In early 2021, the fashion world applauded Elbaz’s return six years after his exit from Lanvin. He was sacked after disagreements with its Shaw-Lan Wang, the Taiwanese Chinese-born lady who owned the brand then.

Former clients and fashion critics were enthusiastic about his new project. Then, shockingly, in April 2021, just as Elbaz seemed on the cusp of realizing his dream, he died of complications from the coronavirus. The designer, who oozed charm and creative vigor despite being constantly anxious about his health, was publicly mourned by the fashion world. After his passing, AZ Factory staff spent their energy promoting his designs on the brand’s website, and at online retailers Farfetch and Net-A-Porter. They also worked tirelessly on putting together a spare no-expense homage show that closed Paris Fashion Week in October 2021.

That show proved to be the biggest ever organized to pay tribute to a designer. Everybody who was anybody in fashion was there and the French establishment too. French First Lady Brigitte Macron sat next to Richemont CEO Jérôme Lambert and other group executives and senior advisers such as Alain-Dominique Perrin. There was a notable absence though: Richemont Chairman Johann Rupert. Rupert never attends fashion shows. That detail speaks volumes about his lack of personal interest in fashion and Richemont’s struggle with other fashion brands such as Chloé and Dunhill.

In March this year, to keep Elbaz’s memory alive, dresses from the show were presented at an exhibition at Paris’ fashion museum Palais Galliera. However, two months earlier something happened at AZ Factory that would change the brand’s destiny.

Rupert decided he needed a new CEO to run his darling, lossmaking British luxury brand Dunhill and picked young Laurent Malecaze who had been chosen by Elbaz to lead AZ Factory. To replace Malecaze, Richemont chose Mauro Grimaldi who worked for Printemps and a few brands like Emilio Pucci and Elie Saab. On his LinkedIn account Grimaldi still describes himself as strategic adviser. Not a word about AZ Factory.

The AZ Factory story is revealing of how emotion, not reason, drive certain of Rupert’s business decisions. The 72-year-old South African billionaire still refuses to let go of Dunhill even though it is known as one of the UK luxury brands that has lost the most money in the past four decades. Rupert is emotionally attached to Dunhill because it was the first luxury fashion brand his father Anton bought in the 1980s. Like AZ Factory, he feels committed to it. And it seems that no one will make him change his mind.

EXODUS
People close to AZ Factory say the exodus of staff coincided with the arrival of Grimaldi at the brand. “No one can contradict him,” one person close to the brand said. Once the one-year homage work was done, some people left because they felt that the company was starting a new chapter post-Elbaz for which they did not sign up. They had joined to work with Elbaz and Malecaze not with Grimaldi.

“At least Laurent had a vision,” one person who worked for AZ Factory said. “Mauro does not. He is very much into “tick the box,” the box of inclusivity, the box of upcycling, etc… Fashion does not work like that. And he thinks and talks about price all the time. But how can you build a collection just around price. He does not understand fashion.” Richemont declined to comment for this report. Grimaldi spontaneously declined an interview request by Miss Tweed at the Hyères fashion festival last October.

Departures started in May, June of this year, according to accounts reported to Miss Tweed by several people inside and outside the company. AZ Factory’s head of marketing and communication – a key member of staff - Charles-Henry Paradis, a former close associate of Elbaz who worked for Christian Louboutin, is on sick leave since the summer. Bastide Rey, who was studio director and had left Dior to join Elbaz with whom he worked before, left to join Alaïa.

The influential French fashion PR company Lucien Pages chosen by Elbaz no longer wants to represent AZ Factory, an industry source said. It stopped working for the brand after its last Paris Fashion Week show by guest designer Lutz Huelle. The catwalk was held at Richemont’s Fondation Cartier for Contemporary Art in Paris, a place considered ill-suited for such events due to its layout. That said, being already part of the Richemont stable, it allowed the group to save money.

Making matters worse, the film of the show was poorly produced. Strutting models were filmed from one angle only. It was obvious the brand could only afford one cameraman. At times other cameras would appear on the film and in the background, you could see computers and metallic boxes on the first floor. Somebody who understands fashion and knows how important such films are for a brand’s image – as it is posted everywhere on social media and on the website of the Federation de la Haute Couture et de la mode - would never allow such a thing to happen, critics say.

“It is never good when it becomes pretty evident that a brand is trying to cut costs and save money,” one former AZ Factory associate said. “Remember this is a business about image, so when you start doing things that affect image, it’s bad news.”

NEW BUSINESS MODEL
After the one-year homage period was over, around January this year, AZ Factory decided to become something else: a platform for young designers. Since no one could replace Elbaz, it chose to invite young designers to tell their story and use AZ Factory’s infrastructure to help promote their work. Only it never quite made this strategy clear both internally or externally.

To this day, the brand continues to sell Elbaz-designed clothes while selling capsule collections by guest designers. If AZ Factory has turned itself into an incubator of young designers, it should describe itself as such, industry insiders say. Only on the brand’s website, customers still read that invited designers are asked to reinterpret Elbaz’s vision. Yet, this attempt at homage confuses the brand’s message, another signal of the lack of strategic focus on fashion from the very top management at Richemont, senior fashion executives say.

The first guest designer was South Africa’s Thebe Magugu, who won the LVMH prize in 2019 and is known for his authentic voice and natural sense of elegance. His dress for the homage collection was one of the most beautiful and featured on posters advertising the Palais Galliera exhibition.

And then came other designers such as Lutz Huelle, known for his denim looks and mix of fabrics. Huelle is also working with Charles de Vilmorin who designs for Rochas and for his own brand. And then there was Ester Manas, whose designs and vision Miss Tweed highlighted last year as among Belgium’s most promising. Manas is known for ruched stretch-mesh dress that fit every body types. Then there was Cyril Bourez, a little-known designer who produced a collection with upcycled products and offered customers made-to-order items.

Other designers are scheduled to come present their work on AZ Factory in the next few months. “If AZ Factory has become an incubator for young designers, it should present itself as such,” one industry insider said. “But for the moment it is still presenting itself as the offspring of Elbaz, paying homage to him while at the same time turning itself into a platform for young designers.”

The company describes itself thus on its website: “Now, AZ Factory welcomes Amigos, guest creatives, to co-create stories and products. We provide them with a platform to develop and share their visions of what fashion means today and to them, by appropriating and reinterpreting the codes that have made AZ Factory unique from day one. With this new approach, AZ Factory offers a new perspective on today’s fashion, driven by the perspectives of uniquely positioned individuals, rather than heritage houses exclusively.”

The business model of promoting the work of young designers cannot be profitable, industry specialists say. When a brand changes designer every two months, customers do not have the time to get accustomed to his or her work and build loyalty to it. AZ Factory is not like Moncler or other well-established brands that invite designers to offer something new every other month. The company is just two years old.

Department stores do not want to work with AZ Factory because they do not want to commit to designers whose work remains untested in terms of demand, fashion retail experts say. AZ Factory is bound to end up with unsold stock which it will have to sell at a discount – the kiss of death in terms of image. Currently, on the AZ Factory website, several previous collections, from Elbaz’s work to that of Magugu, are sold at a discount even though now is the time to sell at full price before Christmas. “Private sale,” the website calls it.

LET IT GO
Industry analysts predict Richemont will keep AZ Factory going for some time but eventually, it will have to let it go, unless it turns it into a foundation that sponsors young designers. But that would not make that much sense either. Unlike LVMH, Richemont does not have dozens of fashion brands for which it needs to build a pool of promising designers.

Some investors argue that Rupert should have closed down AZ Factory right after Elbaz passed away. Back then, it was already clear that it was going to be an impossible mission to make the brand take off and flourish without its founding designer. If Rupert ended AZ Factory, fans would have called it cruel. Rupert, who highly regarded Elbaz and believed in his vision, chose to remain true to his word and fund Elbaz’s newborn baby no matter what. It is still the case now, when it seems evident that the company’s new business model post-Elbaz will struggle to turn a profit.

>>> Innate Pharma - Presents data from ongoing Phase 2 TELLOMAK trial demonstrat

Presents data from ongoing Phase 2 TELLOMAK trial demonstrating clinical activity of Lacutamab in Advanced Sézary Syndrome at ASH 2022; Anticipate IND filing in 2023 for CD20 targeted tetra-specific ANKETTM, IPH6501

  • Lacutamab demonstrated encouraging efficacy and a favorable safety profile in heavily pretreated, post-mogamulizumab patients with advanced Sézary syndrome
  • In addition, Innate’s ANKETTM (Antibody-based NK cell Engager Therapeutics) platform on display at ASH via oral presentation and posters

Presented data from a preliminary analysis of the TELLOMAK Phase 2 trial demonstrating clinical activity and a favorable safety profile for lacutamab, a first-in-class anti-KIR3DL2 humanized cytotoxicity-inducing antibody, in patients with advanced Sézary syndrome, a form of T cell lymphoma. The data were presented during the 2022 ASH (American Society Hematology) Annual Meeting, in New Orleans (United States).
At the time of data cut off (April 29, 2022), the Intention To Treat (ITT1) population included 37 post mogamulizumab patients with advanced, highly refractory Sézary syndrome, and 35 patients were Evaluable for Efficacy (EES2). The patient population was heavily pre-treated with a median of 6 prior lines of therapy. The median follow-up was 10.9 months.
In the ITT population, the global objective response rate (ORR) was 21.6% (8/37). ORR in the blood was 37.8% (95% confidence interval (CI): 24.1-53.9), with 21.6% (8/37) achieving complete response (CR). ORR in the skin was 35.1% (95% CI: 21.8-51.2). In the EES population, global objective response rate (ORR) was 22.9% (8/35). ORR in the blood was 40.0% (95% CI: 25.6-56.4) and ORR in the skin was 37.1% (95% CI: 23.2-53.7).
Within the subgroup of patients that achieved a global response, median duration of global response was 10.8 months (95% CI: 6.2-12.3) with median time to global response of 4 months (range: 1.0-6.5); median time to blood response was 1.0 month (range: 1.0-6.5) and median time to skin response was 2.8 months (range: 0.9-10.2).
In line with previous observations, lacutamab demonstrated a favorable safety profile for patients with advanced Sézary syndrome in the TELLOMAK Phase 2 preliminary analysis. Grade = 3 Treatment-related (TR) Treatment-Emergent Adverse events (TEAEs) were observed in 6/37 (16.2%) patients. Most common TR TEAEs were general disorders and administration site conditions (N=6, 16.2%), skin and subcutaneous tissue disorders (N=5, 13.5%), and gastrointestinal disorders (N=3, 8.1%).

CMO: “This encouraging preliminary analysis in Sézary syndrome adds to the encouraging cutaneous T-cell lymphoma data we previously shared within the Phase 1 study, and Phase 2 mycosis fungoides cohort. The data continues to support our fast to market strategy for lacutamab in the niche setting of Sézary syndrome where lacutamab was granted U.S. Fast Track designation and EU Prime designation. We look forward to final data in 2023 while we continue investigate the role of lacutamab in other T-cell lymphomas including the monotherapy and combination trials for peripheral T-cell lymphoma.”
- Pr. Vivier, DVM, PhD, Chief Scientific Officer: “Progress continues toward investigational new drug (IND) filing in 2023 for our latest innovation, Innate’s CD20 targeted tetra-specific ANKETTM, IPH6501.”
- In addition, Innate partner Sanofi will display two posters on the NK cell engagers SAR’579/IPH6101 and SAR’514/IPH6401.

FT : Investors withdraw record levels of coins from crypto exchanges

Investors withdraw record levels of coins from crypto exchanges
Traders rush for exits alarmed at safety of their assets after FTX filed for bankruptcy

Investors are pulling record levels of bitcoin from crypto exchanges as the collapse of Sam Bankman-Fried’s FTX stirs fears over the safety of their assets.

FTX, once the darling of the crypto industry, filed for bankruptcy protection in mid-November after an $8bn hole emerged in its balance sheet.

New chief executive John Ray described a lack of basic risk management and Bankman-Fried has admitted to poor internal controls. Its rapid descent has alarmed investors who keep and trade their assets on other centralised crypto exchanges, leading to record levels of withdrawals of bitcoin, the most widely-traded crypto token. FTX failed last month with potentially more than 1mn creditors, including many who had left assets on the exchange.

Last month investors pulled 91,363 bitcoin, worth a total of close to $1.5bn based on the November average price of around $16,400, from centralised exchanges including Binance, Kraken and Coinbase. That marked the largest bitcoin outflow on record, according to data from CryptoCompare.
It is unclear whether the coins are being sold or moved to private wallets.

The rush for the exit comes as the price of bitcoin has plunged 64 per cent this year and is currently trading around $17,000.


Withdrawals in October were also high, at 75,294 bitcoin, as crypto traders pulled their funds following a crisis-laden summer which included the collapse of digital asset lenders Celsius and Voyager Digital.

Rival exchanges have rushed to distance themselves and their practices from the chaos inside FTX in an effort to ease customers’ nerves and limit potential market contagion.

However, the record outflows highlight investors’ wariness of bitcoin as the digital asset industry faces increased scrutiny from global regulators.

In the first seven days of December, 4,545 bitcoin were withdrawn from centralised exchanges, compared with inflows of 3,846 bitcoin in the same period last year, according to CryptoCompare.

In a sign of the detrimental impact of FTX’s collapse on its once-rival exchanges, credit rating agency Moody’s placed US-listed Coinbase’s bond rating on review for downgrade in late November, citing “the increasing likelihood of sustained declines in trading volumes and client engagement, two essential revenue drivers”.

“Falling crypto asset prices will restrict businesses’ ability to raise funds and depress customer demand,” Moody’s analysts wrote this week. They added that markedly lower crypto prices “will deteriorate the credit quality of centralised finance companies”.

“While the bitcoin sell-off decelerates, the damage has been done,” wrote Eric Robertsen, global head of research at Asia-focused bank Standard Chartered, this week.

He predicted that the pain for crypto investors will continue well into 2023. “More and more crypto firms and exchanges find themselves with insufficient liquidity, leading to further bankruptcies and a collapse in investor confidence in digital assets,” he added.

FT : Electric car costs draw level with petrol and diesel

Electric car costs draw level with petrol and diesel
Cheaper recharging and rising fuel prices mean EVs cost no more across Europe and UK, data show

Rising fuel prices this year mean that the cost of owning and running an electric car is now lower than petrol or diesel in almost every country in Europe, according to data from automotive lease provider LeasePlan.

Battery vehicles remain more expensive than traditional engine models to buy, although have lower running costs because of less maintenance and cheaper refuelling.

The industry considers the point at which electric cars become as cheap as petrol models to own, run and service — the “total cost of ownership” — a key moment that could trigger a widespread switch to battery vehicles.

LeasePlan, which has 1.9mn vehicles used by corporate fleets, collated running costs and lease prices for its vehicles, comparing them by segment and across 22 countries.

“EVs in nearly every segment and European country are now the same price or cheaper on a TCO [total cost of ownership] basis than petrol or diesel cars,” said the report.

It found the costs of a standard family car, such as a Ford Kuga or an electric Škoda Enyaq, were equal or lower in 19 out of 22 European countries, including the UK, France, Germany and the Netherlands. Only in Poland, Italy and the Czech Republic was the model notably more expensive when electric.


Among smaller cars, such as the Renault Megane or the Kia Nero, the UK purchase and running costs were €919 a month for electric, €941 for diesel and €954 for petrol, it found.

The same cars in France were only €735 a month for electric, compared with €904 for diesel and €868 for petrol.

While petrol and diesel refuelling costs remained similar across most areas, the costs of recharging an electric car varied wildly. Typically, charging at home overnight for several hours was a cheaper alternative to using public fast-chargers, which attract a premium for their higher speed.

For its EV charging calculations, LeasePlan took the current charging habits of its average electric customer, with 65 per cent of charging at home, 20 per cent at a workplace, and 15 per cent at a more expensive public charging point.

LeasePlan found that charging costs amounted to 15 per cent of the cost of owning and running an electric car, while the cost of refuelling a diesel was 28 per cent of the total ownership cost.

“Despite energy price inflation, fuel costs remain significantly lower for electric cars than petrol and diesel cars,” the report found.

 Its data was taken from a four-year lease and assuming an annual mileage of 30,000km, with prices from almost 3,000 cars across 132 models.

 The overall cost of running any vehicle still varied significantly across the region, the report added. With Greece the cheapest country at an average of €905 a month, to Switzerland, which has an average of €1,313.

>>> Barron’s Weekend Summary

Barron’s Weekend Summary: In 2022, a surge of interest in the primary-care market exploded into a buying binge

Cover Story:
In 2022, a surge of interest in the primary-care market exploded into a buying binge. Amazon.com announced a $3.9B deal to buy One Medical in July, while Walgreens Boots Alliance and Cigna pitched in on an $8.9B deal to create a massive doctor’s group that includes a primary-care chain. Walmart, meanwhile, is expanding its primary-care offering, and UnitedHealth Group continues to snap up doctor groups. More recently, a couple of costly new issues emerged for CVS: In October, the federal government cut the quality ratings for certain Medicare Advantage plans run by CVS’ insurance arm, Aetna. That will eliminate government-paid bonuses that the company had expected to receive in 2024. Then, insurer Centene, a customer of CVS’ Caremark PBM, announced that it will switch to a competitor in 2024, further ramping up pressure on earnings targets.

Interview:
-About a year ago, Felix Zulauf, who heads Zulauf Consulting in Switzerland, and who is a former Barron’s Roundtable member, was looking for a steep market drop in 2022 from tightening monetary and fiscal policies. Barron’s spoke to him recently Zulauf suggests that before any predictions for 2023, it’s important to take one step back to see the big picture: “I think that geopolitics and politics will play a more dominant role. We see the building of two major blocs—a democratic bloc led by the U.S. and an autocratic bloc let by China. And this means that the period of globalization of the past 30 years is over. I think we deglobalize for, let’s say, the next 10 years. That means the world will get less efficient and more inflationary. A safe supply chain will be more important than a cheap supply chain.”

Tech Trader:
-There are bargains to be had in the financial markets if you look hard enough and have a little patience. I would suggest that internet and media company IAC is a textbook case of an undervalued stock that deserves more attention. Founded in 1986 as a TV station owner called Silver King Broadcasting, IAC has bought, built, revamped, and sold companies in the media and internet business, over and over again. It’s a holding company, and the nature of its portfolio changes significantly over time. In a 2006 interview with Barron’s, IAC’s longtime chairman and former CEO, Barry Diller, laid out his philosophy on running IAC, which still applies 16 years later.

The Trader:
-“With Christmas just a couple of weeks away, it’s easy to look ahead to candy canes, caroling, and presents under the tree, but there’s still work to be done. The coming week certainly won’t be boring, with highly anticipated inflation data and a Federal Reserve decision on back-to-back days. The two events will do much to determine the direction of the market for the coming weeks—a deeper slide or a resumption of the Santa Claus rally. All eyes will be on the November consumer price index, out Tuesday morning. It’s expected to show some moderation in inflation from the reading a year ago on the headline and core levels—but for both to remain above 6%.”
-It was a bad week for Carvana and a bad week for used-car dealers. But some auto-dealer stocks might still be worth buying. After falling almost 40% this past week, Carvana (ticker: CVNA) is off an incredible 98% this year, wiping out almost $44 billion in market value. That’s more than the size of all other publicly traded auto dealers combined. It’s not hard to see why. Analysts and journalists have started using the word “bankruptcy” to describe where it might be headed. Carvana dismisses this, saying it has “substantial liquidity” to attain its business goals. The concerns about Carvana, along with falling used-car prices, have dinged other preowned-auto dealers, such as CarMax. Yet Carvana just isn’t big enough for its problems to disrupt the market. It sold about 103,000 used vehicles in the third quarter of 2022, or 1.2% of total U.S. used-car volume. And the Carvana brand “has value, so even if it [restructures] the brand will remain,” says Benchmark analyst Mike Ward.

Features:
-A week ago, internet infrastructure supplier Rackspace reported that after discovering a “security incident,” it took some servers offline, resulting in a major service outage preventing thousands of the company’s customers from sending or receiving email. The issue involves the company’s Microsoft Exchange hosting business, which provides customers with Microsoft-based email, calendar, and contact software. Rackspace says the Exchange business accounts for about $30M a year in revenue, or about 1% of the company’s revenue. But the outage is disrupting the operations of a huge number of small businesses, and the company is likely to face considerable related legal and remediation costs.
-Regal Rexnord, a maker of motors and powertrain equipment used in factories, has slumped 15% over the same period. Regal did it to itself. On Oct. 27, the company announced the acquisition of Altra Industrial Motion, a smaller competitor, for $62 a share—and the stock promptly tumbled 13%. Investors have concerns about the timing of the deal.. At a time when many investors thought Regal should be getting ready to play defense, it decided to go on the attack. Those concerns are fair but overblown. Regal has a long history of doing deals and making them work. At the same time, the new company will make enough money to pay down its debt, leaving more equity for shareholders. And while the timing isn’t ideal, it’s better than investors think, given the government spending on infrastructure that could boost demand for Regal’s products. If all goes well, Regal Rexnord’s stock could gain 40% or more over the next 12 months.

European Trader:
-Hermès International, the French maker of Birkin handbags, watches, and silk scarves, has seen its shares fall 3.8% in the past 12 months to a recent 1,516 euros ($1,599), worse than Vuitton bag maker LVMH Moët Hennessy Louis Vuitton, which is flat, but better than the 19.2% decline of Gucci owner Kering. The dip in Hermès shares might be a buying opportunity because luxury goods are typically resilient during hard times—wealthy consumers tend to cut back less on spending. Hermès is in a strong position. Sales in the key China market “picked up strongly” in the third quarter, according to the company, and group sales for the third quarter exceeded analysts’ consensus by 9%. The company also boasts hundreds of thousands of high-end enthusiasts willing to pay whatever it takes to snap up the latest exclusive limited-edition leather goods, which means that Hermès won’t have problems passing on price increases.

Emerging Markets:
-On December 6, the Jakarta parliament unanimously passed a new criminal code that dictates a year in jail for sex outside marriage, and three years for “insulting” the president or various state institutions. Not a great look for a country that welcomed 16 million foreign tourists in the prepandemic year of 2019. President Joko Widodo, better known as Jokowi, blocked similar legislation three years ago. This time, with 14 months left in his second and final term, he sat on his hands. “Jokowi is either so passive now, or he shares a distrust of how democracy has developed in Indonesia,” says Joshua Kurlantzick, senior fellow for Southeast Asia at the Council for Foreign Relations.

Commodities:
-Many traders expected oil prices to hit $200 per barrel mere weeks ago. Instead, prices have crashed. Brent, the international benchmark, fell below $80 per barrel on Tuesday for the first time since January and continued to drop on Wednesday. West Texas Intermediate, the US benchmark, was down 3.3% to $71.84. The crash has been caused by a mix of fundamental factors and trading dynamics. Yawger thinks that fundamentals carry about 70% of the weight and speculation accounts for the other 30%. The biggest fundamental factor was that Europe’s ban on Russian oil shipments included a mechanism for Russia’s oil to flow elsewhere. Oil can still be sold to other countries like India as long as prices are capped at $60.

Streetwise:
-Jack Hough offers some considerations about social media companies and, especially, those that offer an important video streaming component. He notes that BofA Securities has recently published a report predicting that rising short-form video consumption will be the biggest shift in internet usage over the next five years. By 2024, short videos will account for more than 12% of time spent on the internet, up from 5.4% last year. By 2028, shorts will fetch an estimated $108B in advertising, even assuming lower ad rates than for traditional video. Meanwhile, Texas Gov. Greg Abbott banned TikTok on government devices, citing data-harvesting risks. He joins his colleagues in Maryland, South Dakota, South Carolina, and Nebraska. BofA reckons that a broader US ban on TikTok isn’t the likeliest course, but that it would provide the most immediate benefit to industry pipsqueak Snap. New rules limiting TikTok’s access to user data, on the other hand, could hurt its monetization push.

FT : Fashion factory: Mango brings production closer to home in rethink on China

Fashion factory: Mango brings production closer to home in rethink on China
Beijing’s policies and global supply chain chaos prompt sourcing reforms at clothing chain

In 1970, a young Turkish immigrant named Isak Andic began importing blouses from the country of his birth to Spain, bringing something different to people living under a dictatorship. Aged 17, he traded them first as a wholesaler in Barcelona, then opened a store and also sold them from the back of a car he drove around the country. It was the start of a fashion business that 14 years later he would name Mango.

Today, Andic’s status as Mango’s sole shareholder has made him one of the richest people in Spain and his empire has expanded to about 2,600 stores worldwide. It continues to buy clothes from Turkey as well as 18 other countries. But the pandemic and a war in Europe, together with friction between Beijing and the west, are forcing a rethink of its supply chain and China’s central role in its operations.

Toni Ruiz, appointed as chief executive by Andic in 2020, said that globalisation had enabled companies to become “super efficient” in limiting production costs in tranquil times. “But in the end, what we’ve realised is that things can change from one moment to the next.”

He recalled recent shortages of Taiwanese microchips and the European car factories that were brought to a halt by the lack of a Ukraine-made wire harness. “The whole [supply] chain is only as strong as its weakest link,” he said.

In Mango’s case, the chain is mind-bogglingly complex. The retailer procures its glittery €40 party dresses, €15 T-shirts and €100 winter coats from 408 suppliers that own some 1,000 factories, three-fifths of them in Asia. Apple, which recently warned of disrupted supplies because of a lockdown revolt at a Chinese factory, has 180 direct suppliers.

“What we’re looking at is the extent to which all this global sourcing, developed over many years, might become more local,” Ruiz said. “We’re constantly mulling alternatives.”

Mango already exercises a lot of central control. No product reaches shoppers without first passing through its distribution centre north of Barcelona, where 75,000 items an hour swoop along a circuit of overhead rails to be sorted into a giant 170m-long wardrobe.

But during the pandemic, the company was in a constant scramble, dialling production up and down across Asia as Covid-19 outbreaks flared and faded in China, Vietnam, Bangladesh and India. Last year, a lack of container ships left its products stranded far from Europe. “In September, October, November, we were all praying that the weather wouldn’t be bad because we didn’t have any warm clothes,” Ruiz said.

There are specific issues in China, where Mango sources from 262 factories, starting with the zero-Covid policies that Beijing has this week begun to relax and strict visa and quarantine rules that deter business travellers. Then there are Beijing’s fraught relations with Washington and European powers, which Ruiz highlighted, and worries about potential conflict between China and Taiwan, which he described as “part of it all”.

“In this debate about whether 30 years of globalisation will continue or go backwards, the most important thing for us to follow in detail is the China issue,” he said. Asked if Mango would reduce the proportion it buys from the country, Ruiz replied: “I would say yes, but we’ll be very alert to how things evolve.”

Mango gains some freedom from the fact it has only six stores in mainland China and consumers there contribute little to total sales, which it predicts will this year surpass its 2019 record of €2.4bn.


Other brands have already moved more decisively. The US jeans maker Levi’s and UK bootmaker Dr Martens have been reducing their sourcing from China since before the pandemic.

Another factor forcing companies to reassess their exposure is Xinjiang, says Brian Ehrig, a supply chain expert at Kearney, a consultancy. Allegations of the use of forced labour in the region’s factories have led to legislation in the US, UK, Germany and elsewhere that pressures companies to eliminate potential links to abuse. “What we’re seeing more is that the path of least resistance is to move production out of China as quickly as possible,” said Ehrig. Mango said it had no Xinjiang suppliers and did not work directly with any other company in the region.

The retailer has alternatives to China through a twin-track supply chain. Asia is the “long distance” track, producing basics such as T-shirts that normally take six to eight weeks by ship to get to Spain. The “proximity” track comprises mainly Turkey and Morocco, where it produces its most fashionable outfits, all designed at its headquarters in Palau-solità i Plegamans in the Catalan countryside. Those products reach its distribution centre in four to six days, giving Mango the ability to ramp up production quickly to replenish supplies when an item is popular.

Turkey and Morocco play a similar role for Zara owner Inditex and are the obvious places for Mango to expand production closer to home. It also pointed to the potential of Romania, where it uses three factories. Ruiz said Mexico was an option in Central America as it plans to quadruple the number of stores in the US to 40 by 2024.


Luis Casacuberta, director of Mango’s women’s, kids’ and home businesses, said the company was looking for not only flexibility but “robustness”. Unlike carmakers, he said, that did not mean simply having a larger number of suppliers on hand. “We have a reasonable level of diversification already. What we are aiming for is the opposite. How do we build a much more solid base?”

Key to that, he said, was finding suppliers that already did a good job making Mango products and were willing to open up factories in more than one country. “So the flow of ships from the Bangladeshi ports is disrupted? Or there’s been flooding? That allows us to pivot with the same supplier.”

Ruiz has been grappling with unwelcome surprises from day one. He succeeded Andiz, now Mango’s chair, as the pandemic took hold. The first document he signed put several thousand employees on furlough. But if Mango obsessed too much about what could go wrong, he said, “we wouldn’t do anything”.

“The things that are outside our sphere of influence are so huge, but it’s about managing the things that are inside our sphere of influence. So let’s be on the offensive, let’s conquer the market, then let’s have alternative plans in case things happen.”