Evelyn Reynolds

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    U.A.W. Says It Could Expand Auto Strikes on Friday

    The United Automobile Workers union said the strikes against General Motors, Ford and Stellantis could grow on Friday if negotiators don’t make enough progress.The United Automobile Workers union said on Wednesday that it planned to expand its strike against the big three Michigan automakers on Friday if negotiators failed to make substantial progress on new contracts.The union ordered workers to walk off the job nearly two weeks ago at three vehicle assembly plants — each owned by one of the companies, General Motors, Ford Motor and Stellantis, the parent of Chrysler and Jeep. Last Friday the union broadened the strike to include spare parts-distribution centers owned by G.M. and Stellantis, saying it had made progress in its talks with Ford.The U.A.W. president, Shawn Fain, is scheduled to update members in a video streamed live on Facebook on Friday morning.The union is seeking a substantial wage increase to make up for much smaller raises over the last decade. Each of the companies has offered to lift wages by roughly 20 percent over four years, about half of what the U.A.W. is seeking. The union has demanded other measures including cost-of-living adjustments, the right to strike to protest plant closures, pensions for more workers and company-paid health care for retirees.The three plants that have been shut down by the strike include a G.M. factory in Wentzville, Mo., a Ford plant in Wayne, Mich., and a Stellantis complex in Toledo, Ohio. They make some of the manufacturers’ most profitable models, including the GMC Canyon pickup truck, the Ford Bronco sport-utility vehicle, and the Jeep Wrangler.The second wave of the strike idled 20 Stellantis parts-distribution centers and 18 owned by G.M. More than 18,000 U.A.W. workers are now on strike. The union represents about 150,000 workers employed by G.M., Ford and Stellantis.The union and the companies started negotiating new collective bargaining agreements in July, but made little progress until this month. Their contracts expired on Sept. 14 and Mr. Fain called on the first round of work stoppages the following day. More

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    U.S. Government Shutdown Is Unlikely to Cause an Immediate Recession

    White House and Wall Street estimates suggested the economy could withstand a brief shutdown, with risks mounting the longer it lasts.Federal government shutdowns have become so common in recent years that forecasters have a good read on how another one would affect the American economy. The answer is fairly simple: The longer a shutdown lasts, the more damage it is likely to inflict.A brief shutdown would be unlikely to slow the economy significantly or push it into recession, economists on Wall Street and inside the Biden administration have concluded. That assessment is based in part on the evidence from prior episodes where Congress stopped funding many government operations.But a prolonged shutdown could hurt growth and potentially President Biden’s re-election prospects. It would join a series of other factors that are expected to weigh on the economy in the final months of this year, including high interest rates, the restart of federal student loan payments next month and a potentially lengthy United Automobile Workers strike.A halt to federal government business would not just dent growth. It would further dampen the mood of consumers, whose confidence slumped in September for the second straight month amid rising gas prices. In the month that previous shutdowns began, the Conference Board’s measure of consumer confidence slid by an average of seven points, Goldman Sachs economists noted recently, although much of that decline reversed in the month after a reopening.Gregory Daco, the chief economist at EY-Parthenon, said a government shutdown would not be a “game changer in terms of the trajectory of the economy.” But, he added, “the fear is that, if it combines with other headwinds, it could become a significant drag on economic activity.”Jared Bernstein, the chairman of the White House Council of Economic Advisers, said in a statement on Wednesday that the council’s internal estimates suggest potential losses of 0.1 to 0.2 percentage points of quarterly economic growth for every week a shutdown persists.“Programmatic impacts from a shutdown would also cause unnecessary economic stress and losses that don’t always show up in G.D.P. — from delaying Small Business Administration loans to eliminating Head Start slots for thousands of children with working parents to jeopardizing nutrition assistance for nearly 7 million mothers and children,” Mr. Bernstein added. “It is irresponsible and reckless for a group of House Republicans to threaten a shutdown.”Goldman Sachs economists have estimated that a shutdown would reduce growth by about 0.2 percentage points for each week it lasts. That’s largely because most federal workers go unpaid during shutdowns, immediately pulling spending power out of the economy. But the Goldman researchers expect growth to increase by the same amount in the quarter after the shutdown as federal work rebounded and furloughed employees received back pay.That estimate tracks with previous work from economists at the Fed, on Wall Street and prior presidential administrations. Trump administration economists calculated that a monthlong shutdown in 2019 reduced growth by 0.13 percentage points per week.After that shutdown ended, the Congressional Budget Office estimated that real gross domestic product was reduced by 0.1 percent in the fourth quarter of 2018 and 0.2 percent in the first quarter of 2019. Although the office said most of the lost growth would be recovered, it estimated that annual G.D.P. in 2019 would be 0.02 percent lower than it would have been otherwise, amounting to a loss of roughly $3 billion. Because growth and confidence tend to snap back, previous shutdowns have left few permanent scars on the economy. Some economists worry that might not be the case today.Mr. Daco said federal workers might not spend as much as they would have absent a shutdown, and government contractors might not recoup all of their lost business.A long shutdown would also delay the release of important government data on the economy, like monthly reports on jobs and inflation, by forcing the closure of federal statistical agencies. That could prove to be a bigger risk for growth than in the past, by effectively blinding policymakers at the Federal Reserve to information they need to determine whether to raise interest rates again in their fight against inflation.The economy appears healthy enough to absorb a modest temporary hit. The consensus forecast from top economists is for growth to approach 3 percent, on an annualized basis, this quarter. But economists expect growth to slow in the final months of the year, raising the risks of recession if a shutdown lasts several weeks.Diane Swonk, the chief economist at KPMG, said she expected G.D.P. to rise about 4 percent in the third quarter, and then slow to roughly 1 percent in the fourth quarter. She said a two-week shutdown would have a limited impact, but one that lasted for a full quarter would be more problematic, potentially resulting in G.D.P. entering negative territory.“When you start nicking away even a tenth here or there, that’s pretty weak,” Ms. Swonk said.A shutdown could also further convey political dysfunction in Washington, which could rattle investors and push up yields on Treasury bonds, leading to higher borrowing costs, Ms. Swonk said.Biden administration officials had hoped to avoid such dysfunction when they reached a deal with Republicans in June to raise the nation’s borrowing limit. That agreement included caps on federal spending that were meant to be a blueprint for congressional appropriations. A faction of Republicans in the House has pushed for even deeper cuts, driving Congress toward a shutdown.Michael Linden, a former economic aide to Mr. Biden who is now a senior policy fellow at a think tank, the Washington Center for Equitable Growth, said immediate economic effects from the shutdown could force Republican leaders in the House to quickly pass a funding bill to reopen the government.“There’s a reason shutdowns tend to be pretty short,” Mr. Linden said. “They end up causing disruptions that people don’t like.” More

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    U.S. Latino economic output grows to $3.2 trillion, according to new study

    The U.S. Latino economy continues to grow, reaching $3.2 trillion in 2021, up from $2.8 trillion the year prior, according to a new report by the Latino Donor Collaborative in partnership with Wells Fargo.
    If Latinos were an independent country, their GDP would rank fifth in the world, ahead of the United Kingdom, India and France, the study found.
    Industry strength for Latinos remains steady in accommodation and food services, construction, administrative support, waste management and transportation.

    The U.S. Latino economy continues to grow, reaching $3.2 trillion in 2021, up from $2.8 trillion the year prior, according to a new report by the Latino Donor Collaborative in partnership with Wells Fargo.
    Over the last decade, the U.S. Latino economy has grown two and a half times faster than the non-Latino equivalent, surpassing the gross domestic product of the United Kingdom, India, France and Italy, according to the report released Wednesday by LDC, a nonprofit, nonpartisan group focused on reshaping perceptions of U.S. Latinos through data and economic research.

    If Latinos were an independent country, their GDP would rank fifth in the world, the study found.
    “We have a massive economy that’s under-invested right now, under-engaged,” said Sol Trujillo, Latino Donor Collaborative chairman, in an interview with CNBC’s “Squawk Box.”
    Industry strength for Latinos remains steady in accommodation and food services, construction, administrative support, waste management and transportation.
    While growth for the Latino community remains widespread in the U.S. geographically, the community drove particular growth in the states of California, Texas and Florida, amounting to $682 billion, $465 billion and $240 billion of economic impact, respectively.
    That is largely due to the Latino community’s strong population share, labor force participation and overall productivity in those states.

    “I would say if you look at the charts now that we have in our study, 48 out of the 50 states’ growth is tied to this [Latino] cohort,” Trujillo said.

    Spectators cheer during Puerto Rican Day Parade in New York. Thousands of people lined both sides of Fifth Avenue for the annual parade, which recognizes the achievements and influence of Puerto Ricans and Latinos in the city.
    Eric Thayer | Reuters

    The California Latino economy alone would rank as the 21st largest economy in the world, between Poland and Switzerland, according to LDC’s analysis.
    In Latino emerging markets, South Dakota, North Dakota and New Hampshire have seen a surprising surge, with the highest GDP growth rates since 2011. In South Dakota, the economic impact of Latinos grew at an annual rate of 11.8% in 2021, according to LDC, slightly outpacing its neighbor.
    “Businesses operating in these areas must stay ahead of these substantial changes to ensure they remain relevant,” LDC noted in the report. “And be able to meet the needs of their evolving customer base.”
    The report also found that Latinos’ wages and salary incomes — totaling $1.67 trillion in 2021 — grew more than those of non-Latinos over the previous decade at an annualized rate of 4.7% compared to 1.9% for non-Latinos.
    But despite the rapid growth, a substantial wage gap persists in the country, with the average Latino worker earning 80 cents for every $1 earned by white non-Hispanic employees.
    Latinos’ purchasing power in the U.S. was strong and reached $3.4 trillion in 2021. Collective purchasing power of U.S. Latinos grew between 2.1 and 2.4 times faster than non-Latino counterparts, according to the report.
    “In the rest of this century, this cohort is only going to get bigger and bigger,” said Trujillo. “So those who want to get in early, think about it. Think about capital and fund structures that could flow.”
    The findings were released alongside the L’Attitude conference examining the state of Latino leadership, participation and representation in corporate America, as well as in the public, media and entertainment sectors.
    The report is based on data from 2021, the most recent year for which information is publicly available. It includes data from the U.S. Census Bureau, the Bureau of Economic Analysis and the Bureau of Labor Statistics, among others. More

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    Crypto’s Wild D.C. Ride: From FTX at the Fed to a Scramble for Access

    FTX’s demise and its leader’s upcoming trial haven’t stopped a major lobbying push by the industry this week, but the events have changed its tone.Cryptocurrency lobbyists were riding so high in early 2022 that an FTX executive felt comfortable directly emailing Jerome H. Powell, the chair of the Federal Reserve, to ask him to meet with Sam Bankman-Fried, the soon-to-be-disgraced founder of the cryptocurrency exchange.It worked.“The day that would work for me is February 1,” Mr. Powell replied to a Jan. 11 email from Mark Wetjen, an FTX policy official and former commissioner at the Commodity Futures Trading Commission.Mr. Powell’s public calendar shows that he and Mr. Bankman-Fried met as planned. And Mr. Wetjen went on to send the Fed chair two policy papers that FTX had recently published, according to emails obtained through a public records request. “Hope you’re finding these useful!” Mr. Wetjen wrote. “Great to have people like you serving our country.”Mr. Powell has long been cautious about the digital currency industry, but, like many in Washington, he was trying to learn more. FTX was eager to do the teaching. According to newly released records, Mr. Wetjen managed to gain access to a range of federal officials. The records show that Mr. Bankman-Fried secured a virtual meeting in October 2021 with another top Fed official, Lael Brainard, who is now the director of the White House National Economic Council. And public calendars show that Mr. Bankman-Fried went on to meet with another top financial regulator, Martin Gruenberg, head of the Federal Deposit Insurance Corporation.The crypto industry faces a more difficult landscape in Washington after last fall’s collapse of FTX. Mr. Bankman-Fried was arrested on fraud charges in December, and his trial is set to start on Tuesday. The industry has also faced a wide-ranging government crackdown that has sent some crypto entrepreneurs abroad in search of friendlier governments.The companies that have survived crypto’s downturn are still pouring millions of dollars into lobbying, but they are having a harder time gaining access to the halls of power. Some congressional offices have become reluctant to meet with industry representatives. Crypto lobbyists appear less frequently on the public calendars of key officials at the regulatory agencies, and companies have had to shift strategy, straining to distinguish themselves from FTX.“There are a bunch of people who’ve had trouble having meetings,” said Sheila Warren, who runs the Crypto Council for Innovation, an advocacy group. “I have heard from some offices that they will not meet with certain people anymore.”With Mr. Bankman-Fried’s trial approaching, the crypto industry is scrambling to change the subject from FTX.Stand With Crypto, a nonprofit backed by the giant digital currency exchange Coinbase, is planning to hold a “fly-in” on Wednesday, bringing in industry players from around the country to talk with lawmakers.“It has been quieter — and more circumspect, in some respects — but the push from the industry hasn’t abated,” said Mark Hays, who tracks cryptocurrency regulation at Americans for Financial Reform. “The crypto industry knows that its star has been tarnished on Capitol Hill, to some extent.”The mood in Congress was friendlier to the industry in early 2022, when FTX was at its zenith: Mr. Bankman-Fried had been positioned as a sort of wunderkind, eccentric and brilliant. But since its collapse, many lawmakers have argued that the industry should be overseen more strictly.“The tone has certainly changed among Democrats — they’re much more skeptical,” said Bart Naylor at Public Citizen, a government watchdog that has been tracking cryptocurrency lobbying.Regulators were more hesitant to embrace crypto firms even in 2022. It was unusual that FTX directly landed a meeting with the Fed chair.Read the emailsA selection of correspondence between FTX and the Federal Reserve, pulled from a series of Freedom of Information Requests submitted by The New York Times.Read DocumentMr. Powell’s only other listed private-sector meetings in February 2022 were with Jane Fraser, the chief executive of Citigroup; David Solomon from Goldman Sachs; Suzanne Clark from the U.S. Chamber of Commerce; James Gorman, the chief executive, and Tom Wipf, a vice chair, from Morgan Stanley; Jamie Dimon, the chief executive of JPMorgan Chase; the Business Council, a group of chief executives; and the head of Singapore’s sovereign wealth fund.Mr. Powell has met with other financial technology companies — he talked with a representative from the payment processor Stripe in March 2022, for example. But he has not listed similar meetings in 2023, based on his calendars released to date.At the meeting with Mr. Bankman-Fried, Mr. Powell and the FTX officials discussed stablecoins as well as central bank digital currencies, a form of electronic cash backed by the government, a person familiar with the matter said.Mr. Powell has met with other financial technology companies in the past. But he has not listed similar meetings in 2023, based on his calendars released to date.Kevin Dietsch/Getty ImagesMr. Wetjen knew many of the agency officials with whom he was setting up meetings from his previous policy role in Washington. He and Mr. Powell had worked on regulatory issues together while Mr. Powell was a Fed governor, for instance.Dennis Kelleher, the head of the regulatory watchdog Better Markets, said FTX had exercised an extensive web of influence in broader regulatory circles, partly through Mr. Wetjen’s connections.“This is the problem: These relationships, which are not visible to the public, pay dividends year after year after year once these guys swing through the revolving door,” Mr. Kelleher said. FTX also flooded Washington with money, which helped it gain a foothold in congressional offices and at think tanks, he and several lobbyists said.The Fed did not provide a comment for this article, nor did Mr. Wetjen. The White House had no comment on Ms. Brainard’s meeting with Mr. Bankman-Fried. An F.D.I.C. spokesman noted that chairs of the agency often held courtesy visits with financial firm leaders.Back in 2022, FTX was trying to shape how the Commodity Futures Trading Commission regulated it, as Mr. Wetjen made clear to Mr. Powell in one email from that May.“We have an application before the C.F.T.C. that lays out for the agency how to do so,” Mr. Wetjen wrote of regulating FTX. “All the C.F.T.C. has to do is approve it.”The Fed had little control over such matters, but Mr. Powell does sit on the Financial Stability Oversight Council, an interagency regulatory body that includes the director of the Commodity Futures Trading Commission.Mr. Wetjen continued: “To the extent the crypto industry comes up in discussions” at the Financial Stability Oversight Council, “we wanted you to have this context and our views at FTX.”The company clearly failed to make much headway with the Fed chair. Mr. Powell supported an October decision by the Financial Stability Oversight Council to further study the kind of setup that FTX and other trading platforms wanted for crypto asset exchanges, rather than greenlighting it.Now, FTX’s demise has only bolstered the arguments of regulators who wanted to approach crypto firms carefully. This year, the Securities and Exchange Commission has sued Coinbase and Binance, FTX’s two largest competitors, amid a broader government crackdown. With Mr. Bankman-Fried out of the picture, other financial technology companies are spending millions to make sure that the future of regulatory oversight favors them.Mr. Hays of Americans for Financial Reform said the industry was hardly being shunned in Washington, because “money talks.”“I still think they’re getting doors opened.” More

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    Las Vegas Hospitality Workers Authorize Strike at Major Resorts

    Unions representing 60,000 workers across Nevada have been in talks with the resorts since April. The vote is a crucial step toward a walkout.Hospitality workers in Las Vegas have voted overwhelmingly to authorize a strike against major resorts along the Strip, a critical step toward a walkout as the economically challenged city prepares for major sporting events in the months ahead.The authorization vote on Tuesday by members of Culinary Workers Union Local 226 and Bartenders Union Local 165, which collectively represent 60,000 workers across Nevada, was approved by 95 percent of those taking part, according to union officials.Although a vote is a forceful step, it does not guarantee that workers will strike before hashing out a new contract deal with the major resorts. Contracts for roughly 40,000 housekeepers, bartenders, cooks and food servers at MGM Resorts International, Caesars Entertainment and Wynn Resorts expired on Sept. 15, after being extended from a June deadline. Other workers remain on extended contracts that can be terminated at any time.The locals, which are affiliated with the union Unite Here, have been in negotiations with the resorts since April over demands that include higher wages, more safety protections and stronger recall rights so that workers have more ability to return to their jobs during a pandemic or an economic crisis. (Union officials have said there are about 20 percent fewer hospitality workers in the city than before the Covid pandemic.)The authorization vote was approved by 95 percent of those taking part, union officials said.Bridget Bennett for The New York Times“No one ever wants to go on strike,” said Ted Pappageorge, the head of Local 226. “But working-class folks and families have been left behind, especially since the pandemic.”In a statement, MGM Resorts said it was optimistic the two sides could come to an agreement.“We continue to have productive meetings with the union and believe both parties are committed to negotiating a contract that is good for everyone,” said the company.Wynn Resorts and Caesars Entertainment declined to comment on the vote. Negotiations continue next week between the union and the companies.The contract battle comes as the tourism-dependent state, where the rebound from the pandemic’s economic toll has been slower than in other regions, has hedged its bets on a big sports bump.In November, Formula 1 will arrive with the Las Vegas Grand Prix, an international event that is expected to draw hundreds of thousands of tourists. A few months later, the region will be the site of the Super Bowl.“No one ever wants to go on strike,” said Ted Pappageorge, the head of Culinary Workers Union Local 226. “But working-class folks and families have been left behind, especially since the pandemic.”Bridget Bennett for The New York TimesThe authorization vote also comes amid major labor battles nationwide.Thousands of members of the United Automobile Workers union have been on strike against the three major Detroit automakers for nearly two weeks. And while the Writers Guild of America recently reached a tentative agreement with major Hollywood studios after a monthslong walkout, contract talks with tens of thousands of striking actors are at an impasse.In Southern California, thousands of hotel workers with Unite Here Local 11 have staged several months of temporary strikes.The Culinary Union, which is a major base for Democrats in Nevada, a swing state, held a similar strike authorization vote in 2018 among 25,000 workers. A contract agreement with major hotels was reached before any strike occurred.For Chelsea MacDougall, who works as a gourmet food server at the Wynn Las Vegas, watching months of negotiations with few results has been frustrating. Inside an arena crowded with fellow union workers — some waving signs that read “One Job Should Be ENOUGH,” alluding to low pay — she voted to authorize a walkout.“This is our next show of force to companies,” said Ms. MacDougall, 36, who makes $11.57 an hour before tips. “The workers deserve a living wage.” More

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    Dimon warns that the Fed could still raise interest rates sharply from here

    JPMorgan Chase CEO Jamie Dimon is warning that interest rates could go up quite a bit further as policymakers face the prospects of elevated inflation and slow growth.
    “I am not sure if the world is prepared for 7%,” he told The Times of India in an interview.
    The comments come less than a week after Fed officials indicated that they could approve another quarter point increase before beginning to cut a few times in 2024.

    Jamie Dimon, Chairman of the Board and Chief Executive Officer of JPMorgan Chase & Co., speaks during the event Chase for Business The Experience – Miami hosted by JP Morgan Chase Bank for small business owners at The Wharf in Miami, Florida, U.S., February 8, 2023.
    Marco Bello | Reuters

    JPMorgan Chase CEO Jamie Dimon is warning that interest rates could go up quite a bit further as policymakers face the prospects of elevated inflation and slow growth.
    Though Federal Reserve officials have indicated that they are near the end of their rate-hiking cycle, the head of the largest U.S. bank by assets said that may not necessarily be the case.

    In fact, Dimon said in an interview with The Times of India that the Fed’s key borrowing rate could rise significantly from its current targeted range of 5.25%-5.5%. He said that when the Fed raised the rate from near zero to 2%, it was “almost no move,” while the increase from there to the current range merely “caught some people off guard.”
    “I am not sure if the world is prepared for 7%,” he said, according to a transcript of the interview. “I ask people in business, ‘Are you prepared for something like 7%?’ The worst case is 7% with stagflation. If they are going to have lower volumes and higher rates, there will be stress in the system. We urge our clients to be prepared for that kind of stress.”
    To emphasize the point, Dimon referenced Warren Buffett’s much-cited quote, “Only when the tide goes out do you discover who’s been swimming naked.”

    “That will be the tide going out,” he said about the rate surge. “These 200 [basis points] will be more painful than the 3% to 5%” move.
    The comments come less than a week after Fed officials, in their quarterly economic update, indicated that they could approve another quarter percentage point increase by the end of the year before beginning to cut a few times in 2024.

    However, that’s predicated on the data continuing to cooperate. Fed Chair Jerome Powell said the central bank won’t hesitate to raise rates, or at least keep them at elevated levels, if it doesn’t feel like inflation is on a sustained trajectory lower, a higher-for-longer reality with which markets are grappling.
    “I would be cautious,” Dimon told the Times. “We have to deal with all these serious issues over time, and your deficits can’t continue forever. So rates may go up more. But I hope and pray there is a soft landing.”
    Treasury yields have been on the rise since last week’s Fed meeting, with the 10-year note hovering around 16-year highs.
    Wolfe Research cautioned Tuesday that the benchmark note could hit 5% before the end of the year, from its current level near 4.5%.
    At the same time, Fed researchers, in a white paper released Monday, noted the high level of inflation uncertainty, which they said “may be acting as a headwind to U.S. growth and pose challenges for monetary policy.” The paper said that such uncertainty can have an impact on industrial production, consumption and investment. More

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    China-EU relationship is at a crossroads, top official says in Beijing

    The four-day trip to China started in Shanghai late last week and had been some time in the making.
    The visit came less than two weeks after the European Commission, the executive arm of the EU, opened an investigation into Chinese subsidies for electric car manufacturers.
    Dombrovskis is using the trip to explain to his Chinese counterparts that the probe aims to create fairer trading practices, and that the EU does not plan to cut ties with Beijing.

    It is a make-or-break moment for China’s relationship with the European Union, as the bloc’s trade chief asks for more openness and fairness from Beijing.
    “We stand at a crossroads. We can choose a path towards mutually beneficial relations. One which is based on open, fair trade and investment, and working hand in hand on the great challenges of our time,” Valdis Dombrovskis, executive vice president of the European Commission, said at Tsinghua University in Beijing on Monday.

    “Or we can choose a path that slowly moves us apart. Where the shared benefits we enjoyed in recent decades weaken, and fade. And, as a result, where our people and economies face reduced opportunities,” he added.
    This is some of the sharpest wording to come from European officials and follows data that showed the EU logging a trade deficit of almost 400 billion euros with China in 2022.
    “Last year, the EU registered record bilateral trade with China of 865 billion euros ($921 billion). But this is very unbalanced, because the EU has a trade deficit of almost 400 billion euros,” Dombrovskis said Saturday before an audience in Shanghai, where he began his four-day trip to China late last week.
    The visit, which was a while in the making, coincidentally came less than two weeks after the European Commission, the executive arm of the EU, opened an investigation into Chinese subsidies to electric car manufacturers.
    While the EU argues that Chinese support to EVs is creating distortions in the European market, Beijing authorities criticize what they described as “protectionist” views from Brussels.

    Dombrovskis is using the trip to explain to his Chinese counterparts that the probe aims to create fairer trading practices, and that the EU does not plan to cut ties with Beijing.
    In recent months, the EU has put more and more emphasis on the idea of de-risking from China — a concept that tries to bridge the gap between a more aggressive U.S. decoupling and the EU’s awareness that China is a critical trading partner.
    “De-risk. This means minimising our strategic dependencies for a select number of strategic products. Acting in a proportionate and targeted way to maintain our open strategic autonomy,” Dombrovskis clarified in a speech in Shanghai.

    De-risking, not decoupling

    European officials have stressed their plan is not to decouple from China and have looked to influence the United States to take the same approach.
    In a joint statement of the Group of Seven, the world’s seven largest economies, the U.S. agreed there is a need to de-risk from Beijing.
    “It looks more like it’s China decoupling from Europe, and Europe is becoming ever more dependent on China,” Jens Eskelund, president of the European Union Chamber of Commerce in China, told CNBC’s “Asia Squawk Box” on Monday.
    “When you look at the facts, you look at the figures, it looks like the decoupling is going the other direction,” he said, noting that China has been “de-risking itself for decades.”

    One of the areas where the EU is looking to de-risk is the electric vehicle sector, after the share of such China-made cars sold into Europe rose to 8% this year. European officials have said this slice could reach 15% by 2025.
    EV market developments are particularly significant ahead of a European deadline to end the sale of new diesel and petrol cars by 2035.
    Eskelund also said that European automakers set up factories and have up to 95% of their whole production value chain in China.
    “They create jobs, they pay taxes in China,” he said, adding, “What we’re looking at now is… 100% produced-in-China imports [coming] into Europe.”
    When asked about potential retaliation from China over the investigation, Eskelund maintained that both Europe and Beijing have “very deep interests” to try to resolve the matter before it reaches a point of imposing punitive tariffs.
    “The two sides need to sit down and have a grown up conversation about what some of the barriers are,” he said.
    — CNBC’s Lee Ying Shan contributed to this report More

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    U.A.W. Widens Strikes at G.M. and Stellantis, but Cites Progress in Ford Talks

    The union designated 38 spare-parts distribution centers as additional strike targets at General Motors and Stellantis.The United Automobile Workers union on Friday significantly raised the pressure on General Motors and Stellantis, the parent of Jeep and Ram, by expanding its strike against the companies to include all the spare-parts distribution centers of the two companies.By widening the strike to the distribution centers, which supply parts to dealerships for repairs, the union is effectively taking its case to consumers, some of whom might find it difficult or impossible to have their cars and trucks fixed. The strategy could pressure the automakers to make more concessions to the union, but it could backfire on the union by frustrating car owners and turning them against the U.A.W.Shawn Fain, the union’s president, said Friday that workers at 38 distribution centers at the two companies would walk off the job. He said talks with two companies had not progressed significantly, contrasting them with Ford Motor, which he said had done more to meet the union’s demands.“We will shut down parts distribution centers until those two companies come to their senses and come to the bargaining table,” Mr. Fain said.Where Autoworkers Are Walking Out More