Author: Mei Ling Tan

  • Nike and Adidas supplier offers bigger Tet bonuses

    Nike and Adidas supplier offers bigger Tet bonuses

    Some 130,000 workers at Taiwanese-invested footwear maker Pou Chen Vietnam, a contract manufacturer for giants like Nike, Adidas and Puma, will enjoy a 30% increase in Tet bonuses this year.

    That puts the annual windfall for employees at the global shoe supplier back to pre-Covid levels.

    Eight Pou Chen Vietnam factories in HCMC and four in the southern provinces of Dong Nai, Tien Giang, Tay Ninh and Ba Ria Vung Tau announced on Monday that they will set aside over VND1.5 trillion ($62.5 million) as bonuses for workers for the upcoming Tet (Lunar New Year Festival). Tet, the most important festival in Vietnam, falls in late January 2023.

    Depending on seniority, workers who have worked for the company a full year or more will be given Tet bonuses of 1-2.2 months’ salary, from around VND6.5 million ($274.20) to nearly VND26 million. The highest bonus in 2022 was 1.54 months’ salary, while in 2021 the figure stood at 1.87 months.

    Besides Tet bonuses, the biggest and most anticipated reward for workers, Vietnam’s largest employer and trade unions at of its eight factories have planned provide free bus tickets home to migrant workers who will be able to enjoy Tet in their hometowns. Other gifts to poor employees will also be distributed.

  • Nam A Bank gets new chairman

    Nam A Bank gets new chairman

    Nam A Bank on Friday named standing vice chairman Tran Ngo Phuc Vu as the new chairman.

    Vu, 50, has run Nam A Bank’s board of directors since 2019 after chairman Nguyen Quoc Toan resigned to focus on resolving family disputes over ownership of the bank.

    He was earlier the CEO.

    Vu has worked at various financial institutions for nearly 30 years.

  • Aviation stocks rise amid expected industry recovery

    Aviation stocks rise amid expected industry recovery

    Stocks of Vietnam Airlines, Vietjet and other companies in the aviation industries have surged as the resumption of flights to China amid its relaxed Covid-19 policy boosted investors’ sentiment.

    HVN of state-owned Vietnam Airlines closed last week at a ceiling price in its third session in the green and returned to the mid-October price range of around VND11,750 ($0.50).

    Meanwhile, VJC of budget airline Vietjet, the only airline blue chip, gained 5% to close at VND111,500.

    SAS of Tan Son Nhat Airports Services and AST of Taseco Airs, which mostly provide services at Noi Bai International Airport, all gained three sessions to close at VND22,000 and VND54,000, respectively.

    These stocks gained after China relaxed its Covid-19 restrictions and several Vietnamese airlines, such as Vietnam Airlines and Bamboo Airways, announced a flight resumption to Chinese cities.

    Analysts of brokerage VNDirect said earlier this month that the most damaging factor for Vietnam’s tourism and aviation recovery is China’s zero-Covid policy which has been strictly imposed in most of the last three years.

    Chinese tourists accounted for 35% of total foreign tourists in Vietnam before the pandemic, and the figure is forecast to reach 20% in early next year before returning to the old level in early 2024, they added.

    “As the earnings of Vietnamese aviation companies have a high dependency on international traffic, we believe that their figures will surge starting next year.”

    Another reason for the surge in aviation stocks is an increasing number of investors buying the dip after the plunges.

    It also warned that risks such as high oil prices, heavy competition and weakening travel demand due to a global economic slowdown might have impact on the recovery of aviation stocks.

  • Dollar weakens against dong

    Dollar weakens against dong

    The U.S. dollar continued to depreciate against the dong on the black market Monday.

    It plunged 0.86% to VND24,220 at unofficial exchange points.

    The greenback fell 0.19% to VND23,825 at TPBank, and dropped 0.32% to VND23,713 at Vietinbank.

    Eximbank sold the dollar at VND23,740, up 0.17%.

    The rate at Techcombank was VND23,750, up 0.04%. It stayed unchanged at Vietcombank.

    The State Bank of Vietnam (SBV)’s set the reference rate is at VND23,655, down 0.01%.

    The dollar has gained 3.40% against the dong since the beginning of the year.

    The U.S. Dollar Index, which measures the greenback’s strength against major currencies, hovered around a three-month low of 105 points.

  • Vietnamese unscathed by U.S. tech meltdown

    Vietnamese unscathed by U.S. tech meltdown

    The recent layoffs by tech firms in the U.S.’s Silicon Valley have not significantly affected Vietnamese there, and things will return to normal soon, Le Chan, chief engineer at AI startup TruEra, tells VnExpress.

    Layoffs.fyi, the layoff statistics site, shows that more than 100,000 technology employees have been laid off in Silicon Valley this year, including by giants like Meta, Twitter and Amazon. As chief engineer at TruEra, a startup in the field of artificial intelligence in the U.S., and founder of the Viet Tech community, what do you think about this?

    Actually, I’m not too surprised because I think the number should have been much higher. If the economic situation does not improve next year, other problems will arise. The next layoff will be worse than the first one.

    I think the number released by Layoffs.fyi is quite accurate because each of the big companies such as Amazon and Meta contributed tens of thousands. I even think the actual number could be 150,000.

    My own company is a much smaller startup, so we don’t have layoffs. Normally, we face an employee shortage. During the recent Covid outbreak, big tech firms hired on a large scale because they thought after the pandemic there would be an economic boom with everything going up and never down.

    But in reality there isn’t. They’re public companies with shares issued and listed, so they face pressure to sack people to improve their financial situation. Normally, it is difficult for common startups to recruit staff. Now, when large companies lay off employees, smaller firms can recruit them. For small companies, it is actually a good time to hire people now.

    In your opinion, which group is most affected by the tech layoffs?

    The group most affected and I feel the most sorry for is probably young people who have just graduated or are about to graduate. When companies don’t recruit staff, they don’t hire anyone. First of all, they don’t recruit new graduates. Most startups just want to hire people with work experience who can do the job right away. Big companies, too. If a big company stops hiring, it often prioritizes stopping recruitment of new graduates first. New graduates need to be trained; it will take time for them to start working effectively.

    The second group most affected is those who work here on H-1B visas. Most tech people working here are on that kind of visa. Once the visa holders are laid off, they have only 60 days to find a new job. Failing this, they are required to leave the U.S. for their home countries. After returning to Vietnam, it is very difficult to return, right? Normally it takes about 1-2 months to prepare for interviews, and then it takes the same period of time to go for an interview.

    The founder of the Vietnam Tech Society estimated that some 1,000 Vietnamese engineers were affected by this layoff. What do you think about the figure? How have Vietnamese been affected?

    I see many Vietnamese in this tech industry being affected, but I don’t know the exact number because there are no precise numbers. The founder estimated that 1,000 people were affected, but I think it must be much higher.

    There are many Vietnamese people in the U.S., and many Vietnamese work in the tech industry. But I think this layoff is just in line with the economic cycle. When the economy goes down, these things will inevitably happen, not because you are bad or anything but just because the economy is bad and companies have to make difficult decisions.

    Vietnamese engineers are the same as engineers in other countries. In fact, whoever can do the job is recruited and respected. I don’t see much difference between Vietnamese and foreign engineers. Laid off engineers in fields other than technology will find it much harder to get a new job. So, in fact, tech workers still have a huge advantage compared to those in other fields. Now the tech industry is facing a little difficulty because it went up strongly in the past. Now it is going down.

    I found that Asian engineers in general are very hardworking and work quite well. I think it’s going to be okay. There will be layoffs; there will be ups and downs; and there will be times when companies have to decide to lay off. But eventually everything will be back to normal, especially when most people are working pretty well. I don’t think it’s a big deal.

    Many experts believe that famous foreign tech talent in Silicon Valley have houses and cars but their cash is limited. When there are no jobs, they still have to make ends meet. So what’s the situation like?

    This is not correct. In Silicon Valley, a fresh graduate can easily get a job with an income of more than $100,000 per year. It is not too difficult to get $200,000 a year from big tech companies like Google, Facebook and Amazon.

    With such a salary, minus taxes of 30%, they still have some $70,000, completely enough to live on. Anyone who says that laid off tech people have no money or have to live from hand to mouth has never worked as a tech person or has stood outside looking in. I don’t see any tech guys complaining about not having money to live by.

    Fresh graduates can earn $100,000-200,000 a year, or maybe less if they work for smaller companies. After about two years of experience, their income is around $300,000, and with two more years of experience, it is $400,000-450,000. With more years of experience, it is up to $600,000-700,000. With such an amount of money, it is very hard for them to have any problem unless they have done something very, very wrong.

    But it is obvious that, if you are earning some $600,000 and your firm suddenly fires you, it will be hard for you for a while, but not to the extent and not as miserable as some people in Vietnam think.

    Being fired is a bad thing, right? But actually, the compensation you get when you get fired in the first layoff is usually better than later ones.

    Some companies like Meta offer four months’ salary. I know that some other companies like Snapchat offer two or four months’ salary. So that’s a really good deal for sacked people.

    Engineers in tech companies not only get salaries, but also bonuses. And what is more important is the shares the companies give them like in Vietnam. I used to work in Vietnam where employees are paid a 13th month’s salary and Tet bonus.

    But it is a little different here. In the tech industry, in addition to monthly salary, you have the company’s stock. Usually its market value is equal to the salary, so the sum of money is good.

    Obviously, it is very difficult to find a new job. People have to prepare for job interviews, but I think they will find a new job, because the market is not short of jobs. It is just difficult for people who do not want to prepare for interviews or want to work only for certain companies. There is no shortage of jobs in general.

    It is not easy to find a new job within 60 days, but if you have experience, it is completely doable. If you have no experience, it will be fairly easy during this period of time.

    I think there are always ways to overcome all difficulties in life. Always.

    Tech companies in Silicon Valley mostly recruit foreign talent through the H-1B visa policy. The visa was once considered Silicon Valley’s tech talent reserve. Do you think that this round of layoffs poses a risk of drowning tech talent?

    Small groups will be affected, right? As I said earlier, undergraduates and new graduates are affected for a short period of time. In reality, they have their own directions. For H-1B visa holders, they will have other ways to continue to stay in the U.S., or continue to get the visa. There will always be a way out. It may be much more difficult than in the previous period, but there will always be a road to keep walking if you want to stay in the U.S. and to continue to work. They include accepting new jobs with lower pay and going back to school.

    I don’t think tech talent will get drowned. It is not so bad.

    What consequences will the layoffs have for Silicon Valley and the U.S.?

    Every year the U.S. issues 65,000 H-1B visas. The latest layoff affected about 150,000 people, but not all of them have H1-B visas. So that number is not big enough to affect the future of Silicon Valley. There are a lot of tech people in Silicon Valley in particular and many more in the U.S. in general. America has always been a very big tech hub of the world. Silicon Valley has always been a hub that attracts tech talent.

    With the 150,000 laid-off people, assuming that some 10% of them, or 15,000-20,000, have to go back to their native countries, it will not have a big impact.

    Labor shortages have happened in the past, are happening now, and will possibly happen in future, but 20,000 people is just a drop in the bucket. A company like Meta last year seemingly hired such a number of people. So if they have to return to their home countries, it does not matter too much.

    There are some other contributing factors, like venture capital funds. I see that some big venture capital funds pumped less money into startups over the past six months, but then started pumping again when there was a wave of generative artificial intelligence. Silicon Valley will have new technologies. Then there will also be new inventions, then everything will return to the old trajectory, money will still be pumped in, people will be recruited, assets of companies in Silicon Valley will increase as before…

    I do not know about the distant future, but I think in the near future, after this period when the economy bounces back, the stock market goes up again, and companies no longer face the pressure to lay off, the tech industry will be back to normal.

    I strongly believe that in the next 2-5 years, everything will return to the way it was, everything will go up again.

    Given the current situation, what will you advise new graduates or those who are applying for tech firms?

    This is the worst time for them to graduate now, so options are very simple. You do not have to graduate, right? You can continue to study for a master’s degree, or a PhD degree. Obviously, if you have a job, just go to work, do not wait. Take many interviews at many companies. You should accept many different offers. Do not just take one offer and then stop. Nowadays, many companies make an offer and then withdraw it.

    I think you should choose a company with good financial potential, which is performing well, making a lot of money, having no pressure from shareholders to sack people or cut costs.

    The second direction is choosing startups that have full funding. The simplest option is choosing startups which have just raised funds. Such companies will not have much pressure to lay off employees.

    There are a lot of ways. You have to open your mind a bit more. Do not think the U.S. is the only destination. Do not think it is obligatory to work in Silicon Valley. It is a very good place to work, and to develop your tech career. But if that option is not good right now, there are other options that are ok. They are not so bad.

    Singapore, Canada and Europe are all very good options for career development, personal development, family and other issues. Then you can go back to the U.S. later. It is not a big deal. It will be much more difficult but not impossible to achieve.

  • Twitter will soon tell you if your posts have been secretly restricted

    Twitter will soon tell you if your posts have been secretly restricted

    Elon Musk’s revamping of Twitter continues with full force. As the man himself announced via a tweet, the platform is currently working on an update that will show “your true account status,” so you will know if your account has been shadowbanned. In addition to that, you will receive information explaining why your account has been restricted and how you can appeal the ban.

    Now, Musk didn’t explain what it means to be “shadowbanned” on the platform. However, journalist Bari Weiss, who has been given access to corporate files, explains that Twitter employees prevent tweets made by disfavored accounts from becoming trending and restrict the visibility of entire accounts or even trending topics. All this happens secretly, without informing the affected users.

    Disfavored accounts get added to various blacklists, such as the “Trends Blacklist,” which prevents tweets from becoming trending, and the “Search Blacklist,” which Weiss doesn’t explain what it does but most likely restricts tweets from appearing in searches. Weiss also notes that Twitter doesn’t call these techniques “shadow banning.” Instead, employees call these methods “Visibility Filtering,” or “VF.”

    To better understand what VF does, a senior Twitter employee told Weiss that this is a way for Twitter employees to “suppress what people see to different levels.”

    Interestingly, Instagram recently launched a similar feature to what Twitter is working on. The platform now informs users with professional accounts if their posts have been restricted from appearing as recommendations to others. If there are indeed posts that violate Instagram’s recommendation rules, creators and businesses can edit or delete them to become eligible again, or they can appeal the decision.

  • Apple, Ericsson kiss and make up while signing a new licensing deal

    Apple, Ericsson kiss and make up while signing a new licensing deal

    Apple and Ericsson have agreed to settle a patent battle between the two which started in 2015 when both companies sued each other claiming that they each had patents infringed on by the other. Also part of the legal issues were disagreements that both sides had relating to licensing their 2G, 3G, and 4G technologies.

    Both companies buried the hatchet, and peace reigned until October 2021 when Ericsson sued Apple over 5G patent licensing. Two months later, Apple sued Ericsson and accused the networking and telecom firm of using “strong-arm tactics” to renew licensing over expired patents.

    Today’s deal means that Apple and Ericsson shook hands, ending a legal fight over royalty payments for using 5G wireless patents in the iPhone. Ericsson said that the settlement includes granting a global patent license to Apple and global cross-licenses for standard-essential cellular technology patents. Standard-essential patents are required in order for a licensee to meet certain industry standards and as a result, they are licensed using royalty terms that are Fair, Reasonable, And Non-Discriminatory (FRAND).
    In a statement, Ericsson said, “The settlement ends all ongoing patent-related legal disputes between the parties.” The battle between Apple and Ericsson intensified when negotiations on a new seven-year licensing contract covering telecom patents broke down. But that is all in the past after today’s announcement and Ericsson noted that the settlement will “strengthen their technology and business collaboration,” meaning, of course, partnerships between Apple and Ericsson.

    If you’re wondering how Apple ended up owning some intellectual property related to mobile wireless modems, you might recall that during the summer of 2019 the company purchased Intel’s modem business for $1 billion. The transaction gave Apple ownership of some industry standard-essential patents.

    Including the effects of the settlement with Apple, Ericsson forecasts fourth-quarter intellectual property rights (IPR) licensing revenues of $530.3 million-$578.5 million. Besides today’s agreement with Apple, that figure includes intellectual property rights with other licensees.
    You may have experienced some deja-vu when reading this news because it might have reminded you of the last-minute settlement Apple and Qualcomm signed off on back in 2019 just as opening arguments were wrapping up for a trial between the two tech giants. Apple paid Qualcomm a chunk of cash and both firms agreed to a six-year licensing agreement with a two-year option. And both sides signed a multi-year chipset supply contract.
    Apple has been working on its own modem chips which were expected to debut in next year’s iPhone 15 line. But issues surrounding two patents owned by Qualcomm mean that the latter will continue to supply the vast majority of iPhone 15 handsets with the important component. Had Apple been able to use its own modem chip, Qualcomm’s share of modem chips used on the iPhone 15 series would have been reduced to 20%.
    But this goes to show how important licensing intellectual property is to Apple, even when it plans on producing its own modem chip. Certain key technologies could be covered by patents and licensing them, even when dealing with the complex licensing arrangements that Qualcomm demands (remember, “no license, no chips”) can make or break a big project. Even a company like Apple can be stymied by a patent.
    Eventually, Apple and Qualcomm will reach an agreement, or Apple will figure out a way to design its modem chips without having to license certain patents from Qualcomm. But for now, it is Qualcomm’s modems that you’ll find inside the iPhone including 2023’s iPhone 15 family.
  • Changes are coming to the Google Search UI

    Changes are coming to the Google Search UI

    The Google Search app user interface is about to get a new look. Google is testing some changes to the app, including a thicker search bar. Icons for voice search and Google Lens will remain on the bar. Also new, besides the girth of the search bar, is a carousel directly underneath with shortcut suggestions such as “Search recent Screenshots from your library,” get help for your homework using your camera and Google Lens, how to identify songs, and more.

    These suggestions can tell you about things that Google Search can do that perhaps you didn’t know about. They also can start the process and get the ball rolling with a single tap on the screen.

    Also new is a bell icon next to your profile picture in the upper right of the screen. Tap on it to see notifications related to all the topics you subscribe to on Google. Other improvements are coming to the app, including showing you search results even before you’ve finished typing. Just to let you know, this is different from showing you suggestions on what to search for as you type as that is currently available on the Google Search app.
    The difference is that with the new feature, Google Search will try to figure out what you are looking for even before you finish typing it into the search bar and will show you results before you are done. If Google has the correct topic, you will shave valuable seconds off of your session with Google Search. If Google is wrong, the time it takes you to look down on the screen to check and type your query out completely will add a few seconds to your Google Search session. So for this to be useful, Google has to nail the algorithm.

    Right now it’s still being determined whether Google is disseminating the changes mentioned above to the Search UI to everyone or if it is part of an A/B test (Google is known to run these often).

  • Tesla Launches EVs In Thailand Amid Competition From Cheaper Brands

    Tesla Inc launched two electric vehicle (EV) models in Thailand on Wednesday, marking its first foray into the regional autos hub that has long been dominated by Japanese manufacturers.

    The launch of two EVs with prices ranging between 1.7 million baht to 2.5 million baht (($48,447 to $71,205) comes as Thailand makes a push for EV adoption and production by offering tax cuts and subsidies.

    The U.S. automaker plans to start selling its EVs in Southeast Asia’s second-biggest economy via online channels, with deliveries set to start early next year. But it faces stiff competition from Chinese brands like BYD and Great Wall Motors, which have set up showrooms and distribution partners in recent years to reach customers and offer EVs with prices starting at 800,000 baht.

    Tesla did not provide details on sales targets.

    Thailand is Asia’s fourth-largest auto assembly and export hub for companies like Toyota Motor Corp and Honda Motor Co Ltd. It produces about 1.5 million to 2 million vehicles annually, of which about half are exported.

    Fuel-based vehicles, especially made by Japanese brands, still dominate the market and uptake of EVs has gradually gained momentum, with about 7,000 new battery EVs registered in the first ten months of 2022, according to the Thailand Automotive Institute, up from 2,000 last year.

    Customers who showed up to Tesla’s launch in a luxury mall in central Bangkok said they were interested in the new cars being offered.

    “I’m excited. The price differences aren’t significant (from other EV brands),” said office worker Thitipun Paisirikul, 36, adding he expected the re-sale value of the car would be high.

    The government wants at least 30% of vehicles produced in the country to be electric by 2030.

    State-owned energy firm PTT Group this year announced a $1 billion joint venture with Taiwan’s Foxconn to produce EVs in Thailand.

  • Foxconn investing in other countries helps Apple diversify iPhone production out of China

    Foxconn investing in other countries helps Apple diversify iPhone production out of China

    Apple would love to diversify iPhone production out of China. Not only is Apple concerned about the region in terms of geopolitics, it is also worried about the Chinese government doing things like cracking down on COVID like it did last month in Zhengzhou where contract manufacturer Foxconn has its largest iPhone factory. As a result, workers started leaving the campus forcing Apple to admit that consumers will face a delay in receiving ordered iPhone 14 Pro and iPhone 14 Pro Max models now through the beginning of next year.
    At the beginning of this month, China started to relax its COVID crackdown and Foxconn says that it will soon allow workers at the Zhengzhou facility to return to their rental apartments just outside the campus. During the crackdown, Foxconn refused to allow workers on campus to eat in the company dining room and forced them to consume their meals inside their dorms.
    Apple can’t just pick up iPhone production and move it to another country. It needs to find an area where factories can be built, qualified workers can be found, and suppliers are nearby to deliver components in the quantity and quality that Apple needs. One country where Foxconn already builds certain iPhone models is India. Originally, Foxconn built older iPhone models in the country to avoid an import tax on units shipped into the country.
    Foxconn has been producing the iPhone 14 in India and wants to assemble more current models, some for global distribution. Last month, Foxconn announced that it was planning to increase the headcount at its Indian factory from 17,000 to 70,000 over the next two years.
    Foxconn has invested $500 million in its Indian subsidiary. The company was able to inject the cash into Foxconn Hon Hai Technology India Mega Development Private Limited from its Foxconn Singapore Pte Ltd. unit.

    Apple has to be concerned. With production in Zhengzhou using just 20% of its manufacturing capacity in November (says TF International’s reliable analyst Ming-Chi Kuo), the iPhone 14 Pro series is going to be in short supply this month and into January. That’s not good, especially when you’re in the holiday shopping season. This month, Kuo expects Foxconn to utilize 30% to 40% of its iPhone 14 Pro production capacity in Zhengzhou. That’s better, but still far from normal.

    Besides investing in India, back in August Foxconn agreed to sink $300,000 into a plant in Vietnam that will expand production there. Vietnam is another country, besides India, that Apple has reportedly considered as a replacement for China.
    Apple is getting more aggressive with its plans to move out of China completely. The article mentioned a couple of countries that we’ve discussed often as possible landing places for iPhone production (and we even mentioned the pair in this article), India and Vietnam.
    Foxconn appears to be spreading its investments all over the place. Last week it spent $58.98 million on an investment in the Czech Republic. That is where the manufacturer makes smartphones, displays, and cloud servers. Foxconn also has research and development centers in that region. At the same time, Foxconn put $142 million into its unit in Taiyuan, China which it considers a long-term investment.

    Apple is already moving some chip production from Taiwan to TSMC’s U.S. fabs in Arizona. One facility will produce 4nm chips starting in 2024 while the second plant will go online in 2026 and churn out 3nm chipsets. Apple CEO Tim Cook spoke during a TSMC press conference held in Arizona last week and confirmed that Apple plans on buying chips made in the U.S.A. by TSMC.

    Apple is hoping that in five years, its supply chain looks a lot different than it does now.
  • Hyundai, SK To Build New Battery Plant In Georgia

    Hyundai, SK To Build New Battery Plant In Georgia

    Hyundai Motor Group and SK On said Thursday they will build a new battery manufacturing plant in the U.S. state of Georgia to supply the Korean automaker’s U.S. assembly plants.

    Hyundai Motor Group and SK On, the lithium-ion battery subsidiary branch of SK Innovation, recently signed a memorandum of understanding (MOU) for a new EV battery manufacturing facility with details of the partnership still in development, the companies said.

    The companies aim to begin operations in 2025 and said “stakeholders estimate it will create more than 3,500 new jobs through approximately $4-5 billion of investment” in Georgia’s Bartow County. Hyundai separately broke ground in October on a $5.54 billion electric vehicle (EV) and battery plant in Georgia’s Bryan County.

    SK Innovation opened a $2.6-billion battery plant in Commerce, Georgia, in January that is producing batteries for the Ford F-150 EV.

    Hyundai and SK did not immediately say how much they plan to invest in the battery plant. Automakers and battery companies are building battery assembly plants across the United States as the industry shifts to electric vehicles.

    Hyundai, Kia and the South Korean government are heavily lobbying the Biden administration to ease new rules that in August immediately made all EVs assembled outside North America ineligible for $7,500 tax credits — including the Korean automakers’ EVs.

    The South Korean government on Tuesday urged Treasury “interpret ‘commercial clean vehicles’ broadly” to include rental cars, leased vehicles and vehicles purchased for use in Uber or Lyft rideshare fleets.

    Georgia Governor Brian Kemp told Reuters in October the EV tax credit rules should be changed to ensure Hyundai and Kia vehicles can qualify for the credit as it works to complete its EV assembly plant in the state.

    Kemp criticized the $430 billion climate bill approved in August that rewrote the tax credit rules.

    “It was targeted to help a lot of union-based suppliers that are in the United States,” Kemp said.

  • Fonterra reports strong sales, eyes higher earnings

    Fonterra reports strong sales, eyes higher earnings

    Fonterra’s first-quarter profit jumped 84% as it benefits from strong margins in its protein and cheese products.

    The country’s largest dairy processor said normalized after-tax profit increased to $214 million in the three months to October 31, from $116m last year. Sales rose 32% to $5.79 billion.

    Under chief executive Miles Hurrell’s leadership, Fonterra has been selling overseas assets, pulling the co-operative’s focus back to New Zealand where he is looking to eke out more value from the milk produced by its 9,000 farmer shareholders.

    Hurrell said Fonterra was making good progress, and the long-term outlook for dairy remained strong. Fonterra raised its forecast for full-year earnings to 50-70 cents per share from 45-60cps.

    “It’s a very strong upgrade to guidance,” said Jeremy Sullivan, an investment adviser at Hamilton Hindin Greene. “They’re making progress, and it’s flowing through into a very strong operational performance for the first quarter.”

    In the latest quarter, Fonterra’s ingredients business benefited from favorable margins in its protein portfolio, particularly for casein and caseinate products used in medical nutrition, and whey protein concentrate used in products such as high-protein beverages.

    “The sustained strong margins in our protein portfolio give us the confidence to upgrade our earnings guidance, although the wider range reflects the volatility in the market, which we expect to continue in short to medium term,” Hurrell said.

    “If these conditions continue for extended periods, it could have an additional positive impact on forecast earnings.”

    Units in the Fonterra Shareholders’ Fund, which gives investors outside the co-operative access to its dividends, jumped 4.3% to $3.13 in midday trading on the NZX on Thursday.

    The co-operative’s food service business improved relative to the same period last year, but the high milk price put significant pressure on margins in both its food service and consumer divisions, Hurrell said.

    While higher milk prices benefit farmers, they can squeeze profit margins for milk processors like Fonterra unless they can also sell their products at higher prices.

    The group’s profit margin lifted to 16.3% from 15.1% due to strong product prices, partially offset by higher milk prices to farmers.

    The co-operative lowered and narrowed its farmgate milk price forecast for the 2022/23 season to $8.50 to $9.50 per kilogram of milk solids, from its previous forecast of $8.50 to $10 per kgMS. That suggests a payment of $9 per kgMS for the season, down from last season’s record $9.30 per kgMS payment.

    “Global market volatility has prompted some softening of demand for whole milk powder, particularly in Greater China and this is reflected in our forecast farmgate milk price range,” Hurrell said.

    “We continue to feel the impact of geopolitical and macroeconomic events, with higher costs at every point in our supply chain,” he said. “It’s a similar story behind the farm gate with our farmer shareholders managing significantly higher input costs.”

    In the first quarter, Fonterra’s operating expenses increased 13% to $581m.

    Hurrell noted global milk supply from key exporting regions had fallen over the past year, to 268 billion litres in the year to September, from 271 billion litres the previous year.

    In New Zealand, milk supply so far this season was down 2.9% compared with the same point last season.

  • Airbus seeks to supply helicopters to Vietnam

    Airbus seeks to supply helicopters to Vietnam

    Airbus is seeking to expand its aerospace partnership with Vietnam and increase helicopter sales as it sees rising demand for military use and oil exploration.

    The company realizes the potential of Vietnam’s aerospace industry, Johan Pelissier, Airbus general manager in charge of defense and aerospace for the Asia-Pacific region, told reporters Wednesday.

    Airbus produced Vietnam’s first earth observation satellite, VNREDSat-1, which was launched into orbit from France in 2013 and continues to send back images.

    It marked the beginning of Vietnam’s space exploration ambitions.

    Airbus is working with the Vietnam Academy of Science and Technology to produce VNREDSat-2, which is said to be technologically far more advanced than the first satellite.

    Airbus is set to showcase various helicopters and military transport aircraft with long-haul capability and low operating costs and fuel consumption at the 2022 Vietnam International Defense Exhibition starting Thursday.

    Hoang Tri Mai, general director of Airbus in Vietnam, said the country is a key market for her company.

    In addition to commercial aircraft, the company also makes helicopters and transport aircraft for the military, oil and gas industry and search and rescue, she added.

    Fabrice Rochereau, general director of sales and marketing in charge of the company’s helicopter division, said Airbus sees the need for Vietnam to renew its military helicopter fleet in future for search and rescue missions, maritime security and public services.

    Airbus helicopters account for 12% of Vietnam’s fleet, rising to 50% in the oil and gas industry.

  • South Korean TV brands dominate Vietnam market

    South Korean TV brands dominate Vietnam market

    South Korean TV manufacturers Samsung and LG account for more than 50% of Vietnam’s market share, ranking first and third place respectively.

    Samsung leads with a 35-40.5% market share each month between October last year and this year, according to Thanh Nien newspaper quoted a report by German market research company GfK.

    Japan’s Sony followed at 15-19.8%, and South Korea’s LG came in the third place at 14.1-16.1%.

    Chinese brand TCL came in fourth place, followed by Thailand’s Casper, China’s Mi and CooCaa.

    Market analysts have said that Samsung and LG in recent years have gradually been gaining the trust of Vietnamese users who traditionally favor Sony.

    Other Japanese brands, such as Panasonic, Toshiba and Sharp, have been struggling to compete in the TV segment in Vietnam and have stopped assembling their TVs in the country.

  • Employees twiddle thumbs after being overworked earlier this year

    Employees twiddle thumbs after being overworked earlier this year

    Roughly one year ago, when the Covid pandemic hard hit southern factories, Trinh and many other garment workers in the southern province of Binh Duong covered a distance of nearly 2,000 km to return to their hometown, the central province of Thanh Hoa.

    After Tet (Lunar New Year holiday) in early 2022, she intended to seek a job in the hometown to have conditions to take care of her little daughter. But her garment factory phoned her, telling her back to work because it was receiving more orders and facing a labor shortage.

    Many such a call were made as businesses started to resume full operation after the pandemic was put under control. Employers were afraid of encountering severe shortages of labor because a large number of workers had returned to their native provinces, and been reluctant to back to work.

    Nong Van Dung, deputy director of the Dong Nai Department of Labor, Invalids and Social Affairs, said the department’s officers went to the Central Highlands region and the Mekong Delta to persuade workers to come back to work in the southern province. At that time, factories in Dong Nai needed some 60,000 workers.

    Phi Ngoc Trinh, general director of Ho Guom Garment Company, said garment firms, which created 3 million jobs, received increasing orders, and they could choose the most suitable ones.

    Garment 10 Company even prepared materials for production slated for the next six months to serve big markets.

    However, some months later, everything suddenly changed.

    Garment 10 Company’s general director Than Duc Viet said 10-15% of foreign clients told his company to delay production, explaining that they had big inventories till Christmas, while the firm had already prepared materials for production.

    “Returning to this land (Binh Duong), I have never thought that we would be underemployed in the year-end like this,” garment worker Trinh said in late November, sitting in a boarding house in the province’s Di An City.

    After six months of working overtime, she and over 100 colleagues in the garment factory are now working only five days a week.

    Receiving fewer orders, a plethora of garment factories have had to scale down production. The number of orders, mainly from Japan’s Uniqlo and the U.S.’s Nike and Adidas, a garment firm in the northern province of Hai Duong received in October decreased 30% against October 2021, so it told workers to stop working overtime.

    In September, the firm planned to open a new factory, but now it has stopped the plan on hiring more workers, and tried to maintain the current workforce of 17,000 after laying off some 4,000 people.

    Truong Van Cam, president of the Vietnam Textile and Apparel Association, forecasted the order shortage will last till mid-2023 at the earliest.

    Like garment makers, footwear and construction materials firms faced the same gloomy situation.

    “We, footwear producers, have never seen such a strange market over the past 40 years. Orders have dropped en masse in a short period of time,” said a Vietnam Leather, Footwear and Handbag Association official.

    The official said that in June factories still received orders and hired more workers, but only one month later, orders started to decrease gradually. Most factories encountered order shortages of 50-70%, even some got no orders, he recalled.

    Dinh Hong Ky, vice president of the Vietnam Association for Building Materials, told VnExpress that construction material firms have recently laid off more workers than in early 2021 when the pandemic situation was serious.

    In April 2021, the firms also reduced their workforce and working hours, but mainly to follow pandemic prevention rules, while market demands remained stable, he explained.

    Ky’s firm, Secoin, whose nine factories produce bricks and tiles for export to 60 countries, has had to cut jobs. One of the factories has recently reduced its workforce by 40%.

    “In October, the first time in our company’s history, clients in Japan told us to stop production for new orders. They will only receive products for orders placed earlier,” he said, noting that even in the 2008-2009 Asian financial crisis, his company’s export to Japan did not decrease.

    “No one in the building materials industry, neither Vietnamese factories nor foreign customers, can confidently predict when the difficulties will end,” Ky said.

    According to Ky, unfavorable conditions for production include the uncertainties of geopolitical tensions, China’s unpredictability with anti-pandemic policies and high inflation, and Vietnam’s sluggish real estate market and tightened credit growth.

    Massive layoffs

    According to statistics from the Vietnam General Confederation of Labor, 472,000 workers have recently been fired or underemployed, with 41,500 people having their labor contracts terminated. Most of them worked in such labor-intensive industries as garment and textile, footwear, wood processing, seafood, electronic component and mechanics.

    Shrunken working hours and salaries have happened at not only blue-collar workers but also white-collar ones.

    In late November, a leading construction firm with a workforce of more than 5,000 asked office clerks to work only 40 hours a week, from Monday to Friday, and lowered salary-based allowances of managerial post holders.

    Hoai Anh, a communication staff of an advertisement company in Hanoi, was shocked last weekend when she was informed that her income would decrease by 30% starting in December due to the company’s receiving fewer customers. Smaller salary means smaller social insurance premium.